U.S. regulators next month may write rules governing how companies led by AT&T Inc. and Comcast Corp. provide Internet service, deciding on an issue that has divided the technology and telecommunications industries and provoked political debate.
The Federal Communications Commission may vote on the policy, known as net neutrality, at a Dec. 15 meeting, Paul Gallant, a Washington-based analyst with MF Global, said today in a note to clients.
Net-neutrality rules, which would bar telecommunications companies from interfering with subscribers’ Internet service, are backed by President Barack Obama and technology companies led by Google Inc., EBay Inc. and IAC/InterActiveCorp. Telephone providers have said rules aren’t needed and might damp investment.
FCC Chairman Julius Genachowski may not have reached a final decision to seek a commission vote, “but right now it appears to be the most likely scenario,” said Gallant, a former FCC staffer. He didn’t identify sources for his information.
Republicans who won a House majority in the Nov. 2 election have opposed the rules. Representative Cliff Stearns, a Florida Republican, today in an e-mailed statement reiterated warnings about a “job killing and investment freezing net neutrality proposal.”
All Options Considered
Genachowski has been advocating for rules that would prevent Internet-service providers from selectively blocking or slowing content delivered to subscribers while favoring their own offerings and those of business partners.
The agency is considering “all the options” as it seeks “the right rules to write down to preserve Internet freedom and openness,” Genachowski said at a conference in San Francisco on Nov. 17.
The proposal being considered would be “positive” for AT&T, Comcast, Time Warner Cable Inc., Verizon Communications Inc. and Cablevision Systems Corp. because the possible rules don’t include a previous Genachowski plan to pull high speed- Internet service into the regulatory regime used for telephone service, Gallant wrote. Companies said telephone rules might lead to regulation of rates.
Jen Howard, an FCC spokeswoman, said in an e-mail the agency hasn’t circulated the agenda for its December meeting.
“These rumors from outside, uninformed sources are pure speculation at best,” Howard said.
‘Legal Anchor’
Genachowski in May proposed using the telephone rules as the “legal anchor” for reclaiming authority undermined by a U.S. court. Judges on a federal appeals court in April ruled the agency lacked authority to punish Comcast for interfering with subscribers’ Web traffic.
Now Genachowski “is leaning toward” relying on the same section of the law the court attacked, Gallant wrote.
The agency is trying to find authority for goals including subsidizing high-speed Internet service, or broadband, Gigi Sohn, president of the Washington-based advocacy group Public Knowledge, said in an interview.
“The Comcast decision left open a tiny little hole in the needle that the FCC can try to thread,” she said. “I believe they may try to do that.”
Stearns, the top Republican on the House subcommittee on communications, technology and the Internet, said Genachowski’s proposal would “further impede economic growth and job creation.”
“Ramming through Internet regulations would ignore the will of a bipartisan majority of Congress and the American public,” he said.
House members, including 171 Republicans and 74 Democrats, have written to Genachowski to express concern over his proposed Web policies.
To contact the reporter on this story: Todd Shields in Washington at tshields3@bloomberg.net
To contact the editor responsible for this story: Allan Holmes at aholmes25@bloomberg.net .
Monday, November 22, 2010
Thursday, October 21, 2010
Report: Click Fraud Reaching New Heights
Advertisers waste millions of dollars on fake ad clicks, eroding the credibility of brands and throwing away budget dollars for invalid ads on Google, Microsoft and Yahoo. Click fraud for online advertisements rose to 22.3% in the third quarter, ending Sept. 30 -- up from 14.1% during the year-ago quarter, according to a report released by Click Forensics Wednesday.
The countries outside North America with significant CPC traffic producing the greatest volume of click fraud in the third quarter were Japan, the Netherlands, the Philippines and China, respectively, Click Forensics reports. But startups like Irvine-based BlueCava have begun to develop technology to identify click fraud by identifying the devices that cause the fraudulent action.
The technology begins by validating the type of device that clicks on the ad, as well as the number of times to detect click fraud. In fact, BlueCava plans to make public a test running with one client that will demonstrate how many invalid ads run on Google and on its affiliate network. "It will offer proof for advertisers that click fraud occurs," says David Norris, CEO at BlueCava, a credit bureau for devices conducting business online. "Most advertisers waste between 20% and 30% of their budget, so they should go get their money back from Google."
The idea of identifying devices is not unique, especially for enterprise-related platforms. It's a little like remotely downloading updated software to a set-top box, or a Hewlett-Packard printer that when plugged into a Sony laptop can sign on through an open Internet connection and find and download the correct printer driver.
BlueCava has begun to provide original equipment manufacturers with the device identification technology to integrate it into consumer products. This means the device would come out of the box with the ability to identify itself. The services might include security and identity protection, but it would also include the ability to match the device owner with online ads.
Rather than the device relying on a browser cookie to identify a specific audience segment, it now appears it will have a specific demographic profile of its own that Norris believes is "99.9999% accurate." If a billion devices, not people, visited a specific Web site, he says the technology would accurately identify more than 90% of them. The profile of the device could accurately serve up the appropriate ad.
Not only can BlueCava's technology identify the device, but the company has put together a data exchange where businesses can contribute information they know about a device that should make targeting ads more accurate. BlueCava plans to market the data to advertising agencies, brand marketers, ad exchanges, and media-buying companies.
And if that's not enough, the technology can identify fraudulent actions such as child predators. Sites like Disney, which shut down accounts once they find them, tend to be a Mecca for child predators. But companies like Disney must do it manually. There's a way to limit people who are not welcome on Web sites, from sites catering to children to online dating sites like Match.com.
BlueCava also has begun to develop a service that allows devices to identify malware or possibly when someone downloads a piece of software onto a machine and begins siphoning information. During the next 12 to 24 months, Norris says the company will introduce the technology in a variety of places that will "revolutionize" the industry. Norris says BlueCava plans to provide educational material that explains behavioral targeting and the opt-out and opt-in process -- and that if a consumer opts out, it doesn't mean they won't get advertising, it just means they won't get advertising that is relevant to them. The information will launch on a Web site within the next 60 days.
BlueCava continues to attract attention with this focus. The company closed a $5 million first funding round this week led by billionaire Mark Cuban and entrepreneur Tim Headington.
The countries outside North America with significant CPC traffic producing the greatest volume of click fraud in the third quarter were Japan, the Netherlands, the Philippines and China, respectively, Click Forensics reports. But startups like Irvine-based BlueCava have begun to develop technology to identify click fraud by identifying the devices that cause the fraudulent action.
The technology begins by validating the type of device that clicks on the ad, as well as the number of times to detect click fraud. In fact, BlueCava plans to make public a test running with one client that will demonstrate how many invalid ads run on Google and on its affiliate network. "It will offer proof for advertisers that click fraud occurs," says David Norris, CEO at BlueCava, a credit bureau for devices conducting business online. "Most advertisers waste between 20% and 30% of their budget, so they should go get their money back from Google."
The idea of identifying devices is not unique, especially for enterprise-related platforms. It's a little like remotely downloading updated software to a set-top box, or a Hewlett-Packard printer that when plugged into a Sony laptop can sign on through an open Internet connection and find and download the correct printer driver.
BlueCava has begun to provide original equipment manufacturers with the device identification technology to integrate it into consumer products. This means the device would come out of the box with the ability to identify itself. The services might include security and identity protection, but it would also include the ability to match the device owner with online ads.
Rather than the device relying on a browser cookie to identify a specific audience segment, it now appears it will have a specific demographic profile of its own that Norris believes is "99.9999% accurate." If a billion devices, not people, visited a specific Web site, he says the technology would accurately identify more than 90% of them. The profile of the device could accurately serve up the appropriate ad.
Not only can BlueCava's technology identify the device, but the company has put together a data exchange where businesses can contribute information they know about a device that should make targeting ads more accurate. BlueCava plans to market the data to advertising agencies, brand marketers, ad exchanges, and media-buying companies.
And if that's not enough, the technology can identify fraudulent actions such as child predators. Sites like Disney, which shut down accounts once they find them, tend to be a Mecca for child predators. But companies like Disney must do it manually. There's a way to limit people who are not welcome on Web sites, from sites catering to children to online dating sites like Match.com.
BlueCava also has begun to develop a service that allows devices to identify malware or possibly when someone downloads a piece of software onto a machine and begins siphoning information. During the next 12 to 24 months, Norris says the company will introduce the technology in a variety of places that will "revolutionize" the industry. Norris says BlueCava plans to provide educational material that explains behavioral targeting and the opt-out and opt-in process -- and that if a consumer opts out, it doesn't mean they won't get advertising, it just means they won't get advertising that is relevant to them. The information will launch on a Web site within the next 60 days.
BlueCava continues to attract attention with this focus. The company closed a $5 million first funding round this week led by billionaire Mark Cuban and entrepreneur Tim Headington.
Tuesday, October 12, 2010
FEC Rules Paid-Search Political Ads Partially Exempt From Disclosure
Handing Google a partial victory, the Federal Elections Commission said that political candidates can, in some circumstances, run pay-per-click ads without including disclaimers in the copy.
But the FEC didn't completely grant Google's request, which was for a ruling that search ads are exempt from any disclosure rules the same as bumper stickers, pens or other small items.
In an opinion issued on Thursday, the FEC said it couldn't agree on whether to completely exempt search ads from disclosure rules, but that pay-per-click ad copy need not include all required information "where the text ad displays the URL of the committee sponsor's website ... and the landing page contains a full disclaimer."
FEC regulations typically require that political ads include information about who paid for the ad and whether it is authorized by the candidate. But those rules don't apply when the ads are on items too small for the disclaimers.
Google in August asked the FEC to rule that search ads are exempt from disclaimer rules because of the ad copy's 95-character limit. "As a result of this severe space limitation, a text ad is fundamentally different from a television or newspaper advertisement," Google wrote in its request. "Both Google and the advertiser view the landing page as the primary forum in which advertiser-to-customer communications take place."
The FEC's decision regarding search ads stands in contrast to actions by another federal agency, the Food and Drug Administration, which last year rebuked 14 pharmaceutical companies that had advertised on search engines.
The FDA warned that the pay-per-click ads were misleading because the ad copy touted the benefits of drugs without also informing consumers about risks and contraindications. Critics of that move said that the character limits make it virtually impossible to convey in a search ad that a particular drug is a potential treatment while also alerting users to its drawbacks.
But the FEC didn't completely grant Google's request, which was for a ruling that search ads are exempt from any disclosure rules the same as bumper stickers, pens or other small items.
In an opinion issued on Thursday, the FEC said it couldn't agree on whether to completely exempt search ads from disclosure rules, but that pay-per-click ad copy need not include all required information "where the text ad displays the URL of the committee sponsor's website ... and the landing page contains a full disclaimer."
FEC regulations typically require that political ads include information about who paid for the ad and whether it is authorized by the candidate. But those rules don't apply when the ads are on items too small for the disclaimers.
Google in August asked the FEC to rule that search ads are exempt from disclaimer rules because of the ad copy's 95-character limit. "As a result of this severe space limitation, a text ad is fundamentally different from a television or newspaper advertisement," Google wrote in its request. "Both Google and the advertiser view the landing page as the primary forum in which advertiser-to-customer communications take place."
The FEC's decision regarding search ads stands in contrast to actions by another federal agency, the Food and Drug Administration, which last year rebuked 14 pharmaceutical companies that had advertised on search engines.
The FDA warned that the pay-per-click ads were misleading because the ad copy touted the benefits of drugs without also informing consumers about risks and contraindications. Critics of that move said that the character limits make it virtually impossible to convey in a search ad that a particular drug is a potential treatment while also alerting users to its drawbacks.
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