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Will Privacy Concerns Sink NebuAd?

Written on
Jul 8, 2008 
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Kathleen  |
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Will Privacy Concerns Sink NebuAd?

privacy1.jpgADOTAS – Behavioral advertising company NebuAd is under fire from all sides – and their problems could create an industry-wide ripple effect as more and more consumers pile on the anti-BT wagon. Meanwhile, cable and phone companies that say that their financial well-being and growth relies on their ability to send a particular breed of behaviorally targeted ads to their Internet and TV customers are quickly changing their tune, according to a report in The Wall Street Journal.

NebuAd and its so-called controversial practices have been under legislators’ and privacy groups’ microscope for months. Recently, CenturyTel, Embarq, Wide Open West and Charter Communications, have either stopped using or abandoned plans to use NebuAd in response to complaints from customers, lawmakers and privacy groups.

So why is NebuAd such a thorn in everyone’s side? Behavioral targeting is hardly new … but unlike most other BT firms, NebuAd’s software profiles people everywhere on the Web, instead of on just a handful of cherry-picked sites and then sells the info to advertisers – possibly a violation of federal wiretap and privacy laws (i.e. the Electronic Communications Privacy Act of 1986; the Communications Act of 1934 and the Cable TV Privacy Act of 1984.)

NebuAd’s chief executive, Bob Dykes, has responded to the concern, saying the company will periodically notify customers that their surfing activity is being monitored. The company will also offer a new way to opt-out option. (The current option only allows consumers to opt out of targeted ad delivery, not the actual tracking).

In a release today, the company announced its new privacy policies:

“NebuAd has developed a means to offer consumers direct, initial online notification and periodic reminders – thereby equipping users with more opportunities to make informed decisions about their web experience. While current mail and email notification practices remain the most reliable and acceptable means of ensuring consumer awareness for many companies, the ability to offer online notice adds another method of direct communication that NebuAd’s partners may find appropriate in a variety of circumstances.

In addition to its new direct online notification system, NebuAd is also developing a network-based opt-out mechanism that is not reliant on web browser cookies. Leveraging this advanced technology, ISP partners can offer this to their subscribers in order to honor their opt-out choices in a more persistent manner than current systems widely used today.”





Reader Comments.

Besides consumers, NebuAd also badly hurts publishers. Think about it: How would Adotas (and its advertisers) feels if NebuAd replaces all the ads on Adotas with something else.

So right now, I see a lot of ads from Market Leverage when I visit Adotas. If NebuAd has its way, those ads will be replaced with Netflix or a University of Phoenix ad. How would Adotas feel about that ?

Posted by Alden DoRosario | 12:09 pm on July 8, 2008.

Alden,
I don’t think NebuAd redirects income from ads, it just uses a different means to select those ads. In other words, the Adotas site would have to integrate with NebuAd (use their ad tags/scripts) to benefit from the behavioral targeting.

If NebuAd actually /does/ replace ads and intercept revenue then they aren’t going to make it very far with site publishers.

Posted by Mike | 8:19 pm on July 16, 2008.

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