February 9, 2006 8:35 PM PST

Advertisers may face public humiliation over adware

WASHINGTON--Companies could find themselves put up for public humiliation by the U.S. Federal Trade Commission if they continue to advertise through insidious ad-serving software.

Such a move might help in the battle against adware, FTC Commissioner Jon Leibowitz said Thursday at an event here hosted by the Anti-Spyware Coalition. Adware is software that displays pop-up ads on PCs, often after Internet searches.

"I think that could have a beneficial effect," Leibowitz said in an interview. "In this context, maybe shaming a company on how they are spending money might inure to the benefit of consumer's privacy."

The FTC would publicly announce and publish the name of a company that advertises using adware that installs itself surreptitiously on consumer PCs or by using spyware, Leibowitz said. He would recommend publicly shaming advertisers to the other FTC commissioners if the adware problem doesn't decrease, he said.

The idea is a good one, several attendees at the Anti-Spyware Coalition event said. However, Trevor Hughes, executive director of the Network Advertising Initiative, called it "drastic action."

"There are well-intentioned advertisers out there that do not understand where their ads are appearing," Hughes said. "It is easy to shame those advertisers, but that does not solve the problem."

The deeper issue, Hughes said, is the way online advertising is handled. Many companies let a third party take care of their advertising and that company may delegate even further, involving many people and companies before an ad gets placed.

Already advertisers face pressure from consumers not to promote their products or services using adware or other software that consumers may not want on their PC, said Jules Polonetsky, vice president of integrity assurance at America Online.

"Increasingly advertisers are recognizing that this is not a minor issue," Polonetsky said. "There is already an environment out there where prominent advertisers' missteps are being written about."

Among those who have exposed advertisers is blogger Ben Edelman, a Harvard doctoral student and spyware expert.

AOL has a policy not to advertise using adware. To maintain that policy, the company has to keep close tabs on those companies that handle its advertising, Polonetsky said.

"If you simply rely on a policy that you announce or simply rely on a promise from your partner, you invariably will be burned," he said. "In today's networked world you have to do due diligence to ensure your brand does not show up in an offensive location."

Keeping track of contractors
The online advertising world is full of go-betweens that handle advertising. One such company is AzoogleAds, which delivers ads for a number of clients, including online auctioneer eBay, credit reporting agency Experian, Web video rental outfit Netflix, and DVD and music club Columbia House, according to the company's Web site.

AzoogleAds used to display many of its ads through adware, including software from WhenU. Today it is limiting that to 5 percent of all ads it serves up, still including WhenU, said Don Mathis, AzoogleAds' chief operating officer.

"Advertisers rely on us to provide this service for them," Mathis said. "Two years ago nobody ever thought about adware, but everything from enforcement action to legislation has raised the profile of the risk and liability associated with it."

Shaming advertisers is the right answer, Mathis said. "It would not hurt our customers, the legitimate players. This was a grey area for five years; the grey is now being separated into black and white."

Bill Day, chief executive officer of WhenU, also agreed that public humiliation might work to root out the bad actors in his industry. "It is not a wholesale solution, but an important part of what is required," he said.

Like AOL's Polonetsky, Day said that some public shaming is already happening. "Companies are not blind, they see consumer complaints about spyware and bad practices," he said. "I am adamant about driving the bad practice people out because until they are out, we get lumped in with them."

WhenU's software is installed on about 12 million PCs. The ad-serving software is bundled with about 80 other applications, including the BearShare peer-to-peer file-sharing application. For such applications WhenU enables the publishers to make some money while delivering the software at no cost to users, Day said.

WhenU claims to have cleaned up its act and has abandoned the practices of paying third-party distributors for each installation of its software, essentially promoting surreptitious installs of its application. Other adware and spyware applications still get installed onto consumer PCs with user consent or knowledge, experts said here.

Aside from public humiliation for the advertisers, the adware and spyware companies also face the wrath of the FTC. Commission Chairman Deborah Platt Majoras, in a speech at the Anti-Spyware Coalition event earlier on Thursday, said the FTC would win the battle against adware and spyware.

"The dissemination of harmful, unremovable programs that frustrate consumers' ability to control their own computers is digital carjacking, and we intend to vigorously prosecute it," Majoras said.

See more CNET content tagged:
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Great idea!
What a terrific idea! If advertisers are truly ignorant of how their ads are being used, this will be a wake-up call. If they are 'innocent' they can publicly apologize and yank their ads, which will restore their reputations. If they are guilty, the public deserves to know it. Let's do it!
Posted by jhencken (65 comments )
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hopefully this would also include the likes of SONY
Posted by brian g--2008 (25 comments )
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I have been saying ths all along
Advertising is worthless without a way to get back to the advertiser. Because of that, we have all kinds of power to kick the shins of advertisers who SPAM and use adware.
Not to mention, there isn't one marketing specialist that isn't a total scumbag. They should be humiliated too.
Posted by thenet411 (415 comments )
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Nice thought, but pointless
I'm sure those who visit the FTC sites religously on a daily basis will take great joy in mocking the companies that find themselves posted on these lists , but the other 99.9% of the population really won't care, won't see it, and will be unaware. It's the same sort of situation with posting the pictures of sex offenders and deadbeat parents; unless these pictures are right there, in your face on a day to day basis, you may as well shame the person by posting their picture in the inside of the glove box of your car. No one will see it. Now a partnership with yahoo or google to put a rotating slideshow of images and names on their front pages. THAT would get noticed.
Posted by menty666 (53 comments )
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It would get around
The web being what it is, those lists will be disseminated much more widely by other sites for a variety of reasons.
Posted by Michael Grogan (308 comments )
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it would get around
Blogs would pick it up, news outlets would pick it up. Come on... writers/editors/bloggers ARE NOT going to miss a chance of having:

"Feds say Sony Spyware Strike Three. So are they outta here?"

as a headline!
Posted by The user with no name (259 comments )
Link Flag
List of the public's time and resource theives.
This is a good idea - not perfect as pointed out already, but at least it would be a start. A more effective method would be significant fines against US spaming - spammer and advertiser. All companies that advertise, pay for those ads and if they were being fined you can bet they would damn sure know how their ad money was being spent. Just listing violaters, requires a lot of public exposure to be effective. Big companies may be affected by negative media exposure - especially if tied to a consumer boycott of those companies - but who organizes the boycott? The main problem that I see is that most of the spaming companies are small to medium sized companies that may careless about their public image because they correctly reason that no one has heard of them, and therefore will not seek them out anyway. Otherwise why would they be so desperate as to engage in spamming?

One hope of listing spamming individuals/companies might be the evolution of an international vigalante organization that would accomplish many nasty and expensive computer related problems to those organizations that spam - to include their management just to make it as personal as stealing our personal time and resources. While perhaps being jsut as illegal as spamming - it might affect spamers bottom lines without worry of jurisdiction issues. You know the old saying - "fight fire with fire." For this happen you would need a list of spammers. Its a good place to start.
Posted by duggerdm (103 comments )
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Why reward them with free advertising?
There is no such thing as bad publicity.

Obviously companies that advertising using ad-ware don't really care about their public perseption. Doing this would be an incentive for them.

The only real answer is to fine these companies.
Posted by davecazz (5 comments )
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Because we dont punish anymore......
We are a society of laws and yet we're no longer a society of holding people to them. Otherwise you wouldnt see this crap. You wouldnt see spam or phishing either. We can land men on the moon with precision mathematics done with people using SLIDERULES but we wont locate a 14 year old spammer and lock them in a prison for 30 years. We wont stop spyware or phishing. We wont stop fax-spam nor will we stop people from driving drunk or too fast or wreckless in parking lots and so on. We've become a society of closet-complainers and at the same time we're openly ACCEPTING of everything we see around us, afraid to criticize anyone or anything.

ENOUGH with the political correctness. Lock up the CEO of that spyware/adware/spam or phish attack whether he or SHE be 14 or 41 - WHO CARES.

When people begin to see that society is getting back on track with sticking to switch and harsh punishment that fits the crime, others may begin to think twice before they commit the same act.
Posted by MS789 (17 comments )
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Posted by hector a (16 comments )
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GOOD, now how about some prison time too
Whats the difference between spyware and following me into my home and reporting on every single thing I say, do, eat and so on? Slimebags.
Posted by MS789 (17 comments )
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Not Going to Help
Unfortunately, public humiliation over adware is not likely to change anything.

Wherever a market exists, suppliers will be there to serve it. If big companies with national brands are afraid of humiliation, and as a result, pull their advertising, smaller known advertisers will instantly fill the void.

Main street may be about the short tail, but Internet commerce is about the long tail. Specialized, niched players have billions of dollars to spend online  and they will pick up where large advertisers leave off.

I wish this proposed solution would solve the ad problem (because the idea of sneaking software on to the computer of a user who doesn't want it is putrid and unethical), but I know that public humiliation won't do anything at all. Its wishful thinking.
Posted by bostonscott (1 comment )
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