January 25, 2000 8:10 PM PST

Privacy fears raised by DoubleClick database plans

Having sealed its purchase of a direct marketing company, DoubleClick has begun signing up sites to create a network that will tie Web surfers' travels with their personal information and shopping habits--online and off.

The leading Web advertising company plans to build a database of consumer profiles that will include each user's "name, address, retail, catalog and online purchase histories, and demographic data," according to the company's new privacy policy. The database, which the company says will only be seen by DoubleClick, is intended to help members of its budding, U.S.-based Abacus Alliance perfect their target marketing.

The move comes a little over a month after New York-based DoubleClick completed its $1.7 billion acquisition of Abacus Direct and in the wake of the Federal Trade Commission's November probe on the growing trend of online profiling. Privacy advocates, who protested the deal from the start, have unsuccessfully tried to get the FTC to review the implications of the merger because they say it means one thing for consumers: less privacy.

Until recently, DoubleClick's policy was to not correlate personal information with its 100 million cookies, which are scattered worldwide. But the new database will rely on the cookies, which the company places on Net users' computers to record surfing habits and display pertinent advertising. Net users aren't informed when they are given a DoubleClick cookie unless their browser is preset to do so, but they can "opt out" through the company's Web site.

The more than 11,500 sites that belong to DoubleClick's network could feed into the new database, which will correlate with the personal information in Abacus' existing database of more than 2 billion consumer catalog transactions. The rollout was first reported by USA Today.

DoubleClick says that not all of the sites using its ad technology will join the alliance.

"They have to somehow have something to give to be a member of this," said Jennifer Blum, DoubleClick's spokeswoman.

The new database works like this: In the past, if a person named Jane Doe had a DoubleClick cookie that detected that she loved golf-related sites, the company could show her ads for sports-related content. But in the future, if the same surfer gives personal information to a member of the Abacus Alliance, DoubleClick will know a lot more about her: that her name is Jane Doe, and that she used to buy sweaters and pants via Company X's catalog but hasn't done so for years. However, Jane did buy a coat online last month. Now DoubleClick can advise Company X to target Jane with Net ads instead of sending her a catalog.

"Yes, of course this will be done," Blum said. "The goal here is to match up the information."

DoubleClick says that the focus of the alliance is to eliminate junk mail and to give consumers information about products they want. But privacy advocates charge that the combined companies are finally acting on their potential to create one of the most extensive consumer profiles ever.

"Privacy advocates have been saying for years that marketers will turn the Net into a gigantic data-gathering machine for junk mail, telemarketing and advertising; now that machine is working," said Jason Catlett, founder of Junkbusters, a clearinghouse for privacy-protection measures.

DoubleClick contends that before members of the Abacus Alliance put information into the new database, they must inform consumers.

"Going forward, when a consumer puts in personal information to a Web site that is a member of this alliance, they will be told that the information will be shared with other parties," Blum said. "Consumers are given notice and choice if they want to opt out."

Blum said that once companies join the alliance they also must give Net users notice that their information is going to be shared--even if that person has shared information with the Web site before.

But privacy watchdogs say an opt-out policy is not fair to consumers who may not realize that when a company says their information is being shared with a "third party," it's really the potentially enormous DoubleClick database.

"DoubleClick is trying to characterize this as choice, but its practice is based on opt out, not opt in," Catlett said. "We said this would happen--behold it quietly has."

 

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