On Second Thought... NebuAd Not Really Dead... Re-Emerges In The UK Under An Assumed Name

from the nice-one! dept

After writing about how NebuAd had shut down, a commenter pointed out this wasn't quite true. Instead, it appears the company has just re-appeared under a different name in the UK... where officials have ruled that clickstream tracking behavioral advertising can be legal (though that's gotten the UK into trouble with the EU). Apparently, NebuAd had opened a UK office, and with the shutdown of US operations, the UK office re-branded as Insight Ready Ltd., but it appears to be the same basic company, including same employees. And the Insight Ready domain name was registered by NebuAd....

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Ding Dong, NebuAd Is Dead

from the so-much-for-that-plan dept

While it took many months since Congress made it clear that NebuAd's somewhat sneaky clickstream tracking/behavioral advertising plans were almost certainly illegal, it appears that the company has finally shut down completely. The similar Phorm remains in operation in the UK, but is still facing significant legal scrutiny and has been running around trying to convince everyone that it's system doesn't violate anyone's privacy. Either way, there's a good lesson to be learned: while it may seem that individuals don't pay all that much attention to their privacy rights, if you cross the line and abuse what people feel is sacred, it's going to come back to bite you.

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Europe Begins Legal Action Against The UK For Allowing Phorm To Proceed

from the a-little-privacy,-please dept

We were quite surprised when the UK gave a basic approval of Phorm's clickstream tracking/behavioral advertising effort -- despite widespread consumer outrage that their internet surfing was being tracked and sold for advertising purposes. And given that simple approval, Phorm has been looking to aggressively expand. However, it appears that other officials may have a different idea. The European Commission has "started legal action" against the UK for allowing Phorm to proceed, saying that it seemed likely to violate European privacy rules. Who knows if this will actually go anywhere, but it seems pretty clear that the rather widespread mistrust of Phorm is making sure that it's not able to do much at all without additional scrutiny.

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ISPs: It Was All NebuAd's Fault!

from the not-us!-not-us! dept

With Congress clearly indicating that it believed NebuAd's clickstream tracking behavioral advertising was illegal, there have been efforts underway to file class action lawsuits against the various ISPs who tested the service. It appears those ISPs have an interesting defense they're trying: it wasn't us! Specifically, they're claiming since all of the customer clickstream data resided on NebuAd servers, none of the blame can be put on the ISPs. That seems unlikely to fly in court, however, considering that the ISPs teamed up with NebuAd specifically for the purpose of tracking that data.

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Behavioral Advertisers Try To Come Up With Code Of Conduct Before FTC Writes One For Them

from the self-regulation dept

While the US Congress came down hard on NebuAd for its "behavioral targeting" ad program that would be used by ISPs to track everywhere you surfed and toss up relevant ads based on overall surfing activity, the FTC was a lot more hands-off. Instead, it simply suggested that the industry figure out a way to self-regulate before the FTC felt the need to step in. So, of course, they're now trying to work out guidelines for behavioral advertising. While I tend to be against putting in place gov't regulation where there's no evidence that it's necessary, I always find industries claiming that they'll "self-regulate" amusing. It's hard to see them coming up with guidelines that will satisfy people who believe their privacy is being violated. About the only way to do that would be to make such a service entirely opt-in -- and that seems unlikely (at best).

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Phorm, Apparently Deaf To Consumer Hatred Of Being Spied On, Plans Expansion

from the seriously? dept

Phorm is the highly controversial behavioral advertising firm that teams up with ISPs to spy on your surfing habits and deliver targeted ads. The practice has raised a number of legal challenges and protests from users who were "tested on," without their knowledge. While Phorm has been found to be legal in the UK, its practices have still engendered widespread anger. Yet, the company seems particularly deaf to those concerns, and is talking about plans to expand internationally, despite the fact that similar schemes have run into legal troubles elsewhere. Perhaps before looking to expand internationally, Phorm should work on fixing its business model.

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BT Bans Talking About Phorm, Erases Earlier Discussions

from the we-were-always-at-war-with-Eurasia dept

You may recall that BT was one of the bigger supporters of Phorm, the controversial clickstream tracking system that would allow ISPs like BT to insert their own behaviorally targeted ads into your web surfing. The company held extensive trials with the system, without letting users know that their clickstream data was being sold to advertisers in order to do more targeted advertising. Now that UK officials have decided that Phorm is legal, if clearly explained to consumers, BT has chosen a funny way to make sure there's clarity around the system. Slashdot points out that BT has apparently banned discussion of Phorm on its forums and erased earlier forum discussions about the technology. How's that for openness?

Is it really so hard to allow open discussion on such a topic? If BT believes that it's reasonable to use the technology, then why not explain why clearly, responding to the critics? The only reason to erase these discussions is if BT knows that what's it's doing is highly questionable, and BT would rather not have to explain itself.

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Is Public Shame Enough To Keep ISPs From Doing Bad Stuff With Your Data?

from the not-if-no-one-knows-what's-going-on dept

While there has been a lot of attention paid recently to ISPs using clickstream tracking to provide targeted ads, it seems that many people are still focused on the activities of the ad companies, such as NebuAd, which garnered some attention from Congress for its offering. However, as we pointed out recently, many ISPs have been selling your clickstream data to others for years without people knowing about it. Now, with Congress threatening to put regulations in place, the various ISPs are scrambling to push back against that possibility.

For example, Broadband Reports points out that Verizon is claiming that the chance of a public shaming will keep the company honest. While it's certainly true that a public shaming is a risk, it's also true that the sale of clickstream data is usually kept entirely secret, which would preclude any sort of public shaming. Public shaming could work if the companies were upfront and honest with how they're using data. But, since they're not, it's difficult to see how that works as a self-regulating mechanism.

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Most People Don't Realize Their ISPs Are Already Spying On Them

from the wake-up... dept

We recently wrote about how you should probably be more nervous about the data your ISP is collecting rather than what Google is collecting, because your ISP has access to a lot more data, and the data it has isn't data that you chose to give, as in the case of Google. Plus, ISPs have a long history of selling that data. Now, a new study is showing that most people have no idea that their ISPs track and sell their data, with many believing that an ISP would need to first let them know if they were doing that. In fact, many people are quite concerned about how that data would be used, not realizing that it's already being sold. And, of course, it's not just being sold to ad companies like NebuAd and Phorm, but to website tracking firms like Compete and Hitwise. And, even if that data is sold solely for the purpose of creating trend data, there's no reason that uses can't change over time. For example, the Register is noting that a recent patent lawsuit suggests that trend-tracking research firm Hitwise (which was recently bought by credit giant Experian) may be working on an advertising product as well, that also uses your clickstream data.

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UK Police Stop Phorm Investigation, As They Don't See Any Criminal Behavior

from the civil,-however.., dept

While American competitor NebuAd may be on the verge of shutting down, it appears that Phorm, the controversial clickstream tracking, behavioral ad company that focused mainly on the UK market, may be dodging a series of bullets. First, the government said that clickstream tracking could be legal if the situation was clearly explained to customers and there was an obvious mechanism for opting out. Now, UK police are dropping their own investigation of earlier trials with BT, which many believed were illegal because they were done with no notice to consumers at all, and no way to opt-out. That would seem to go against the government's earlier statements, but the police are saying that there's no evidence that this is a criminal matter -- which would leave this open to civil lawsuits from individuals who were impacted by the trials.

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UK Says Phorm Clickstream Tracking Is Okay... If Clearly Explained To Customers

from the we'll-see-what-customers-say dept

With US-based clickstream tracking company NebuAd on the rocks, similar UK competitor Phorm has actually received approval from the UK government, despite concerns over legality. Apparently, the UK has decided that as long as Phorm clearly states what's happening, allows easy opt-outs (even if users change their minds later), then it's fine. What's not clear, though, is how the government will treat Phorm's early tests, which did not include clear notification or easy opt-outs. In the meantime, if such programs really are clearly communicated to users, do you think enough people would opt-in to make it worthwhile?

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AT&T Says It May Inject Its Own Ads In Your Surfing... And You'll Like It

from the oh-really? dept

Various ISPs have long made extra cash by selling your clickstream data to various tracking outfits. But in the last few months, it's come out that many have been either testing or considering taking things a step further by inserting their own ads based on your surfing history, using technology from firms like NebuAd and Phorm. Both of those companies have run into some trouble lately, as there are serious questions as to the legality of such practices, which have gotten the attention of folks in Congress.

While most ISPs have shied away from giving too detailed answers to Congress, apparently AT&T has decided to take a different stance. While the company says it has not tried any such ad insertion technology, it vehemently defends the idea, claiming that it would implement it "the right way" and that it "could prove quite valuable to consumers and could dramatically improve their online experiences, while at the same time protecting their privacy."

This is an old line that's been used before about these types of services: that it somehow enhances your surfing experience by throwing less crappy ads at you. Of course, this is based on the somewhat faulty assumption that people actually care about most banner ads, no matter how relevant. Also, it's hard to see how it "protects" a customer's privacy, when the whole point of these programs is to make use of your surfing details (which most people believe is private) to make your ISP more money.

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Phorm Secretly Used By American ISPs As Well

from the totally-transparent? dept

Looks like Phorm may be facing another headache as The Register has found out that it was quietly used by some American ISPs, as well. Earlier stories had suggested that Phorm, which tracks your web surfing at the ISP level and customizes ads based on your clickstream data, was only testing the service in Europe, while competitor NebuAd was focused on the US. Phorm is facing some legal inquiries in Europe, while NebuAd is laying people off as Congress is investigating the legality of the service.

But the most bizarre aspect of this is Phorm's claim that its tests with US ISPs was "transparent." If that's the case, it's odd that no one had pointed it out before. That would suggest that it wasn't nearly as transparent as Phorm claims. In fact, it suggests the opposite.

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NebuAd In Trouble After Congress Suggests Its Entire Business Is Illegal

from the oops dept

We've covered the saga of companies like NebuAd and Phorm, who basically worked with ISPs to access your clickstream data and place advertisements based on your overall surfing habits, rather than the specific page that you're on at that moment. It didn't take long before people realized that such services (beyond just being somewhat deceptively implemented by ISPs) were probably illegal. And, of course, given the public outcry over these services, it didn't take long for Congress to get involved, suggesting that it felt these activities were illegal.

So, of course, if you happen to work at Phorm or NebuAd, you've got a bit of a business model problem (not to mention the potential legal problem). The Register is reporting that NebuAd has now laid off a bunch of employees -- and also dumped its PR firm. Considering the fact that no amount of PR probably could have stopped consumer outrage over how these services were implemented, it seems like the PR firm may have been something of a scapegoat --- or, perhaps, the company just realized that any PR work at this point is simply futile.

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Charter Communications Realizes People Don't Like Having Ads Injected Into Websites

from the a-slight-miscalculation dept

Last month, cable broadband provider Charter Communications said it was going to test the clickstream tracking/behavioral ad injection service NebuAd, claiming (hilariously) that snooping on you as you surf in order to present ads to you enhances your web surfing experience. It turns out that many Charter customers did not agree -- and they weren't made any happier when independent research into NebuAd's system discovered many, many problems with it, including the fact that you couldn't really opt-out. Also, Congress got involved, asking Charter to explain itself. That's never a good sign.

Charter has now agreed to back off plans to implement this clickstream tracking. However, the most hilarious part is Charter's explanation of why it went forward with this plan in the first place: Focus groups apparently indicated that "most broadband consumers would look upon this service favorably." Well, when you describe it as "enhancing" the broadband experience, rather than spying on your every action to present you with more targeted ads, people might say that. In the future, though, it may help to be a bit more straightforward with focus groups.

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Research Into NebuAd Finds Controversial And Potentially Illegal Tactics

from the not-looking-good dept

NebuAd is a company we've discussed before, that basically works with ISPs to use your clickstream data to send targeted ads. It's quite similar to Phorm, which has received plenty of attention for its questionable behavior over in the UK. Now, some researchers have looked into the details of what NebuAd really does... and it's not pretty:

NebuAd exploits normal browser and platform security behaviors by forging IP packets, allowing their own JavaScript code to be written into source code trusted by the Web browser. NebuAd and ISPs together cooperate in this attack against the intentions of the consumers, the designers of their software and the owners of the servers that they visit.... NebuAd breaks the rules of acceptable behavior on the Internet. It monitors what you do and see on the Internet, it breaks in and changes the contents of your private communications, it keeps track of what you've done, and if you even know that it's happening, it is impossible to opt-out of it."

Perhaps Charter Communications and other ISPs that have signed up for NebuAd should have researched things a little more thoroughly. Congress is already investigating the legality of something like NebuAd, and one assumes that a report like this may find its way to many of those politicians pretty quickly.

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Phorm Did Track IP Addresses, Replaced Charity Ads With Behavioral Ads

from the how-nice-of-them dept

Phorm, the extremely controversial former adware company that reinvented itself as a behavioral advertising firm that would work with ISPs to look at your clickstream data and serve you special ads instead of the ones you were supposed to see, has been working overtime to defend its program as being perfectly legitimate and no risk to anyone's privacy. Of course, that's not satisfying many, as it later came out that, despite claims of openness, BT and Phorm had secretly tested the service without letting anyone know their clickstream data was being used this way. Even worse, after this news came out, BT and Phorm downplayed the test, only to later have it come out that it was quite extensive.

And, now, it gets even worse. More information has been leaked out about that test. As for it being super duper secret without your IP address ever being compromised? Well, not so much. It turns out that an internal BT analysis found that IP addresses were likely used as the identifier, which is the exact opposite from what Phorm has insisted. And, as for how well the system works? Well, it was successful in covering up ads for various charities and replacing them with "targeted" behavioral ads instead. Wouldn't want those darn charities to have anyone see their ads.

Update: A representative of Phorm has gotten in touch to note that there were some incorrect statements in the original report on this. Specifically, it appears that Phorm purchased the original charity ads that were replaced -- so it's not as though the charity lost anything here. It's easy to understand why the original interpretation of the BT report would make one think this was not the case, as it stated: "The advertisements were used to replaced [sic] a 'default' charity advertisement (one of Oxfam, Make Trade Fair or SOS Children's Villages) when a suitable contextual or behavioural match could be made by the PageSense system." It does not appear to say that the ads were purchased by Phorm -- at least not in that same section. At this time, there is still no indication whether or not the charities knew their ads were going to be "covered up" in this manner. None of this, of course, answers the questions about whether or not this test was legal.

Update 2: And now BT has also gotten in touch with us to complain -- though they falsely accuse us of making false statements, saying that the headline still says they "hijacked" charity ads. It does not and has not. It has always said "replaced" which, I'll remind BT, is the exact word used in their own report. Unless BT was falsifying its own report, the word "replace" is correct. The mistake was in suggesting that Phorm had not purchased that ad space -- and that has already been corrected quite clearly. BT also is upset that we accused them of "misleading ICO." The only problem: we made no such statement. Finally, BT complains that no personal information was used in the trials -- which is a point that is still disputed. The original researcher who researched the report claims that IP addresses were passed to Phorm's proxy server and that personal info was requested on a web form. BT notes that the IP addresses were not stored -- but that doesn't mean they weren't used, which was what was in question. Also, to both Phorm and BT, the comments on this post are open, and you are free to make your case here where anyone else can see it. Contacting me personally, with vague, slightly threatening and sometimes incorrect statements is certainly less effective that making your case to the public. Part of the reason you're in this PR situation is because of your secrecy. Being a bit more open might help.

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Congressmen Not Happy About Charter's Plan To Sell Out Users To Advertisers

from the might-want-to-think-twice dept

While Charter Communications is out defending its efforts to inject ads into your surfing activities by collecting data on where you surf, it appears that some powerful Congressional Representatives are suggesting that Charter might want to think twice about implementing this. Reps. Ed Markey and Joe Barton (who both have a fair amount of power in Congress) have sent Charter a letter warning the company that doing this without letting people affirmatively opt-in may violate the Communications Act, which limits what cable companies can do with customer records. What's really surprising is that, after so much anger over similar efforts in the UK (including similar questions about legality) that Charter forged right ahead with a nearly identical plan in the US, positioning it as an "enhancement." Update And on top of this, reports are now coming out that opt-ing out of this system isn't so easy after all.

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Charter Tries Convincing Users That Selling Your Clickstream Data Is Enhancing Your Online Experience

from the euphemism-much? dept

There's been plenty of controversy over ISPs using companies like Phorm and NebuAd to effectively sell your clickstream data to advertisers by inserting "more targeted" advertising into your regular surfing. If you haven't been following the controversy, these systems work by watching everything you surf online at the ISP level, and compiling a profile in order to serve ads on other pages. In other words, if you surf a website about golf, your ISP records this and then when you're later reading technology news, the ISP may inject an advertisement about golf. Beyond questions raised over the legality of such things, there are many questions raised concerning how such systems violate privacy. There have been calls to make sure that these types of solutions are opt-in only. In the meantime, ISPs that are adopting these solutions are trying to present them in the best possible light. Witness cable broadband provider Charter, who is pitching its use of NebuAd as a way to bring you its "enhanced online experience." Charter, which is setting this up as a opt-out solution, rather than an opt-in solution, sent an email to its subscribers, talking up all the wonderful "enhancements," brushing over the fact that it's basically exposing all of your surfing history to advertisers, and inserting its own ads into your experience. I'm not sure most users would actually consider that to be "enhanced."

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Marketers Freak Out About Mandates To Make Clickstream Tracking Opt-In Only

from the but-what-about-our-data? dept

With all of the fuss finally being raised concerning clickstream tracking by companies like Phorm and NebuAd, there's an effort underway to force ISPs to make any such tracking strictly opt-in. That is, users would have to proactively agree to allow their data to be used in this manner. In response, various marketers are complaining about how much data they would lose, claiming it would be an "armageddon" for the industry. Don't believe them. This is the same thing marketers warned about when the US instituted a "Do Not Call" system, and it's hardly decimated the marketing industry. Instead, it's improved marketing by making firms focus less on intrusive telemarketing and more on useful marketing. The same would happen if ISPs were required to make this an opt-in instead of opt-out setup. It would force the ISPs and companies like Phorm to make sure that the services really benefited customers in meaningful and noticeable ways so that customers would be happy to make use of the services. By whining about an opt-in solution, all these firms are really admitting is that they do not add value to the surfing experience of users.

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