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NebuAd Chairman Says Company 'Satisfied' With 'Opt-in' Privacy Proposals

in Broadband's Impact by

By William G. Korver, Reporter, BroadbandCensus.com

WASHINGTON, July 17 – With other panelists calling for comprehensive privacy legislation, NebuAd’s CEO told a House Energy and Commerce subcommittee on Thursday that the internet advertising company would be “satisfied” if an “opt-in” rule became mandatory.

During the a hearing on “What Your Broadband Provider Knows About Your Web Use: Deep Packet Inspection and Communications Laws and Policies,” before the Subcommittee on Telecommunications and the Internet, Chairman Ed Markey, D-Mass., said that most of subcommittee members favored an opt-in approach.

Under an opt-in rule, internet consumers would have to consent before personal information could be shared. Current law more closely replicates an “opt-out” model, with consumers required to affirmatively object to data-sharing by businesses.

Markey said that most Americans do not believe than the implied consent of the opt-out model should be the nation’s privacy standard.

In other words, under Markey’s approach (and that of a majority of the subcommittee), if a consumer did not give explicit consent, NebuAd would not be able to monitor a consumer’s web habits.

NebuAd’s business model gleans information from broadband carriers who are customers of NebuAd without prior consent of either the consumers or the owners of web sites that the internet consumers visit.

Charter Communications, for example, was considering using NebuAd.

David Reed, a professor in the Media Lab at MIT and a developer of the Internet in the 1970s, said that NebuAd’s actions are like a mailman opening and reading the contents of the mail before it is delivered.

Prompted to dismiss the analogy by Rep. Cliff Stearns, R-Fla., NebuAd Chairman and CEO Robert Dykes did so: the post office is a government-owned enterprise, while NebuAd is a private company.

UPS and FedEx are also private companies, yet the public does not expected them to engage in such activities, countered Markey.

Attempting to calm fears, Dykes reiterated his position over the past several weeks: NebuAd has and will continue to provide “robust” notice to users and allow a user to op-out of information-sharing with NebuAd.

When a user selects to opt-out, NebuAd immediately deletes the information that it has stored on the individual and ceases to monitor the individual, said Dykes.

He said NebuAd only surveys categories like travel and automotives and maps these categories against de-identified user profiles. The Center for Democracy and Technology and other privacy groups claim that NebuAd’s model is pseudononymous, not anonymous.

Alissa Cooper, CDT’s chief computer scientist, said her group had “warned that that consumers are increasingly concerned about the growing amount of personal data being collected by online advertising practices,” and urged the passage of comprehensive privacy legislation.

In his testimony, Dykes said that officials from his company met earlier this week to discuss privacy issues with CDT. He said that “self-policing” in the advertising world has worked.

Dykes also committed to a privacy audit of the company’s practices.

Attempting to steer privacy oversight to search engine giant Google, Scott Cleland, president of Precursor, a consultancy engaged in advocacy against network neutrality, blasted the company as “the worst privacy offender on the Internet” and engaging in “unauthorized web service surveillance.” He got a laugh out of his description of the company as “J. Edgar Google.”

Information about web clicks are a true treasure trove about sensitive personal data, he said. As a result, Congress should pay more attention to Google’s privacy practices than those of broadband providers, Cleland said.

Also testifying against NebuAd’s practices was Bijan Sabet, general partner for Spark Capital. Although such “deep packet inspection” is a milestone in technological innovation, Sabet counseled the members of the subcommittee that the practice threatens the openness of the Internet. He also championed Net neutrality.

Congress Must Keep Internet from Being 'Hijacked' By NebuAd Model, Says Group

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By William G. Korver, Reporter, BroadbandCensus.com

WASHINGTON, July 8 – Online advertising firm NebuAd is violating individual users’ privacy, and possibly state and federal laws, officials at the Center for Democracy and Technology (CDT) said at a Tuesday briefing on a report.

But in order to allow consumers to opt-out of the NebuAd-advertising model, Congress must pass laws forcing such companies to become more transparent, said two CDT officials, plus a key consultant, at the Tuesday briefing. The event was co-sponsored by CDT, plus Free Press and Public Knowledge, two other non-profit groups.

Robb Topolski, a consultant who authored a June 18 report, published by Free Press and Public Knowledge, accused NebuAd of paying internet service providers (ISPs) to allow NebuAd to eavesdrop on web users and place packets into responses from websites in order to “force-load” cookies on internet users’ computers. NebuAd is an online advertising firm.

CDT President Leslie Harris and Vice President Ari Schwartz, plus Topolski, counseled legislators against falling into the trap of “lumping” NebuAd’s tactics with that of other internet issues and players. The CDT report and press briefing come one day ahead of a Senate Commerce Committee hearing on Internet behavioral advertising.

Harris said that the NebuAd online advertising approach “appears to defy” consumer expectations and “violate” state and federal wiretapping laws. She said that the Federal Trade Commission needs to issue “enforceable guidelines” instead of mere drafts of suggestions.

NebuAd has yet to fully disclose whether or not it ceases to collect information from a user even after the user elects to no longer be the target of NebuAd’s controversial behavioral profiling, she said.

Behavioral profiling is the tracking of a user’s web site visits, search terms, online purchases, and “click through” responses to advertisements in order to infer the interests, habits, and associations of the user.

Harris also said that a “privacy regime” is needed to replace the current “broken” one.

While federal law would likely allow the practice “with the consent of the subscriber,” the user’s consent should not be gained through a “terms of service” agreement or a billing statement, said the 13-page CDT report. Individual state laws also may require the consent of consumers for such an advertising model to be legal, said Schwartz.

Furthermore, lawmakers should bear in mind that NebuAd, while maintaining that it does not collect user data, has never said whether it sees and analyzes such data, said Topolski.

Such a possibility is extremely unnerving, he said. Data relating to the real-time performance of advertising competitors would be available to NebuAd. Internet compatibility, innovation, and investment may all be threatened by NebuAd business model, he said.

CDT wants Congress to pass legislation barring internet service providers from permitting advertising networks to copy the web traffic streams of the internet subscribers without users’ consent.

”Clear notice and prior [user] consent” must be given in order for user data to be collected according to the new NebuAd model, said Schwartz.

Documents Referenced in this Article:

Center for Democracy and Technology Report on NebuAd (PDF)

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