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Companies Pay Fines For Advertising In Adware... Still Not Clear How They Broke The Law
from the please-explain dept
Over a year and a half ago, as NY Attorney General Eliot Spitzer was investigating various spyware/adware firms, he noted that he was thinking about going after the advertisers who advertised through adware, but it wasn't entirely clear what they had done that was illegal. It may have been a bad business decision, in that adware ads tend to piss off users a lot more than it's likely to make them happy customers. However, is it really illegal to advertise that way? We had thought that it was more of an attempt to scare various advertisers away from the adware providers -- which was actually accomplished much more successfully by suing the adware firms and having advertisers realize they might not want to do business with firms under investigation for sketchy practices. The FTC took a different approach, threatening to name and shame various advertisers who used adware. Overall, though, as many of the worst adware providers have been sued out of business, we figured the issue was done with. However, Spitzer's successor, Andrew Cuomo, apparently picked up where Spitzer left off, and has convinced Priceline, Travelocity and Cingular to pay fines for advertising in adware. Now, it's hard to feel sympathy for companies that advertised that way (in fact, you might as well fine them for thinking it was a good idea in the first place), but no one has yet explained what it was that these advertisers did that was illegal. No doubt there are plenty of things that the adware firms did that broke certain laws in tricking people into installing their software -- but the advertisers had no say in that side of what was going on, so it's difficult to see what they actually did wrong here.
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Advertising Network Chains
One thing to consider is that not all advertisers know where there ad is showing up. Some of the investigations into the click fraud world demonstrated that ads might be passed along three generations with different people attempting to generate traffic. With affiliate offers and other programs often the source of advertising will not realize the various means by which traffic is being generated, including spyware offers.
In addition, I have been called by this spyware companies many times and the way they sell themselves it is not always clear what they are doing -- until you really dig and investigate further (I'm a marketing manager)
Not saying these particular companies did not realize, but for many people putting out online offers it is not always clear exactly where your offer ends up. The bigger brands have the people and resources to track down where there ads show up but many smaller advertisers could easily be duped by the slick sales people who call them and talk about their "network."
In addition, some ad network will have legitimate traffic and then slip in spyware traffic to boost numbers, making it more difficult to determine the direct source of the visitors.
Michael @ SEOG
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