November 22, 1999 3:50 PM PST
Privacy advocates rally against DoubleClick-Abacus merger
Although privacy groups have sent letters asking the companies' shareholders to reject the merger and have complained to the Federal Trade Commission about the privacy implications, approval of the deal is scheduled to be voted on tomorrow.
Opponents of the merger worry that it will increase the likelihood of corporate abuse of customer data by bringing together Net surfing habits obtained from the 5 billion ads DoubleClick serves per week and the 2 billion personally identifiable consumer catalog transactions recorded by Abacus.
Still trying to turn up the heat on the merger, privacy groups planned to meet with FTC commissioners Sheila Anthony and Mozelle Thompson today to call for the agency to use its existing jurisdiction over unfair business practices to crack down on online profiling and to scrutinize the pending deal. Earlier this month the FTC examined profiling, a growing trend in which firms piece together Net users' personal information and surfing habits to target them with advertising and new services.
Advocates also sent a new round of letters to managers of so-called socially responsible mutual funds, such as the Citizens Emerging Growth Fund, Dreyfus Third Century Fund and Smith Barney Concert Social Awareness Fund, asking them to drop DoubleClick and Abacus from their portfolios.
"The companies aim to automatically and invisibly link your offline identity with your movements on the Net--that is a terrible change to the medium," said Jason Catlett, founder of Junkbusters, a clearinghouse for privacy-protection measures.
"It's a full frontal attack, funded by Wall Street, on anonymity on the Net," Catlett added. "We are calling for the FTC to put an immediate halt to online profiling pending the development of a suitable regulatory framework."
A representative for Abacus referred CNET News.com's request for a statement on the privacy groups' protest to DoubleClick, for which representatives weren't immediately available to comment.
DoubleClick, which is a member of the Online Privacy Alliance and pledges to disclose its data-collection practices, has contended in the past that it doesn't gather personally identifiable information from Net users.
But DoubleClick does collect personal information through other means, such as surveys, purchase forms and its own sites.
"For the Web sites owned or controlled by DoubleClick, [we] may ask for and collect such personal information," DoubleClick's data-collection policy states.
For example, DoubleClick's site NetDeals.com collects visitors' names, their home and email addresses, and birth dates through contest entries.
Citing the NetDeals.com disclosure, privacy advocates warn that DoubleClick can match unique identification numbers that it assigns to surfers' computers via cookies with personal information collected through NetDeals and other sites such as IAF.net. People can "opt out" of DoubleClick's cookie system through its Web site.
The NetDeals site also states, "We participate in the DoubleClick Information Alliance and share the information we have about you with that Alliance." DoubleClick's privacy statement, however, doesn't mention the alliance, and a search for "DoubleClick Information Alliance" on its site doesn't turn up an explanation either.
In their letter to mutual fund managers, the privacy groups argue that the capability to combine Net users' cookies with any personal information, and to match those records with offline sales databases, is a huge threat to consumer privacy.
"The trend threatens to fundamentally change the nature of the Web, from one where people's movements in cyberspace are generally anonymous to one where their identity and a large profile moves around with them," states the letter signed by Catlett, the Electronic Privacy Information Center and Privacy International.
"Divest any holdings of DoubleClick and Abacus Direct as soon as possible," the letter continues. "Add DoubleClick and Abacus to 'screening' lists of companies that are to be excluded from investment based on social criteria, specifically a disregard for human rights."
DoubleClick's own privacy statement indicates that its practices may change in the future when it comes to building profiles on Net users.
"DoubleClick has no rights or plans to use Abacus' database information prior to the completion of the merger," the policy states. "Upon completion of the merger, should DoubleClick ever match the non-personally identifiable information collected by DoubleClick with Abacus' database information, DoubleClick will revise this Privacy Statement to accurately reflect its modified data-collection and data-use policies and ensure that you have adequate notice of any changes and a choice to participate."
The advocates' quest for funds to relinquish any holdings in Abacus and DoubleClick won't be easy. Both firms are faring well in the market, with DoubleClick's shares closing up 8.31 at 158 today, while Abacus closed up 10.5 at 167.31.