[Date Prev][Date Next][Thread Prev][Thread Next][Date Index][Thread Index]

Re: more breaking privacy news (from Wall St Journal via NewsScan)



A Plan to Track Web Use Stirs Up Privacy Concerns
By JULIA ANGWIN
Staff Reporter of THE WALL STREET JOURNAL


A tiny new Web company, Predictive Networks Inc. of Boston, is causing
concern among privacy advocates -- even before its start-up Monday.

The reason: Predictive has developed software that can track every site a
Web surfer visits and build a "digital silhouette," or a profile of him or
her based on those movements. If someone were to visit an online sailing
site, say, then a travel site and a scuba site, Predictive's profile model
might immediately send that person sunscreen or snorkel ads in pop-up
windows. The company also plans to target news content based on a user's
profile.

Predictive believes that Web users will be willing to let them track their
every move online in exchange for a cheaper rate from their Internet service
provider. Starting today, IDT Corp., of Hackensack, N.J., will use
Predictive's software for its free Internet service called free-atlast.com.

Predictive will share ad revenue with IDT and other ISPs it signs up in the
future. Advertisers, who will place their ads through Predictive, are so
eager for this sort of precision targeting that some have already agreed to
pay ad rates as much as six times more expensive than usual.

Although other free Internet-service providers already track and target
their customers, privacy advocates are concerned because the Predictive
software pushes the depth of digital eavesdropping to a new level. There are
federal laws about listening in on other people's phone conversations, and
privacy proponents argue that such protections should extend to the Net --
largely accessed via phone lines, after all.

"It takes a court order and tight supervision to listen over a telephone
link," says Dave Farber, a privacy advocate and professor of
telecommunications at the University of Pennsylvania. "It's really time for
Congress to set limits and decide that we need a privacy policy."

Privacy advocates also suggest that such profiling software will encourage
more and more ISPs to track customers since it's getting easier to do so.
And that could make less-affluent people, who flock to free ISP services,
particularly vulnerable, says Lauren Weinstein, founder of the online
Privacy Forum, an advocacy group. Because they can't afford monthly Internet
fees, he says, "a lot of people would be basically coerced into giving up
their personal information."

Until now, most tracking and profiling online has been done by individual
Web sites trying to determine who their visitors are, or by advertising
networks such as DoubleClick Inc. That company stirred a privacy backlash
earlier this year for its plans to tie its database on Web-surfing behavior
with people's names and addresses. DoubleClick has since backed down.
Traditionally, large ISPs haven't tracked their customers' surfing.

Predictive founder Devin Hosea, 30 years old, left his job as vice president
of technology investment for GE Capital's equity capital group in 1998 to
pursue his passion for artificial intelligence. He says the budding
opposition to Predictive surprises him. "We created this company to solve
the privacy dilemma -- people want personalization but also want their
privacy," he says.

The product he created requires ISP customers to download Predictive's
software onto their personal computers. The program then keeps tabs on which
Web sites were visited. Each user receives a score based on the sites they
visit. For example, a visit to the Fidelity Web site would trigger a high
score in the areas of age and income, he says, reflecting the older wealthy
visitors typical for the site. The score is then modified based on each
subsequent site visited.

Mr. Hosea says that Predictive stores only the scores in its database, and
discards the actual list of sites visited. The ISP doesn't have access to
the scores. Users will be allowed to look at their scores twice a year, he
said, much as people can review their credit reports.

The software also has the capability to collect any words typed into a Web
page, such as keywords at a search engine, but Mr. Hosea says the company
hasn't decided yet whether to perform that task. Any issues created by the
keyword search, he says, will be resolved by an independent privacy
governing board he has appointed, which will be run by Harvey A.
Silverglate, a Boston civil-liberties lawyer.

Mr. Hosea says the service allows Predictive to send ads and content that
users actually want to see. In some market tests, he says, users clicked on
16% of ads they saw using Predictive's software. Industry statistics show
that less than a 1% average is more typical on the Web.

Michael Packer, director of domestic operations for IDT, says the high
"click-through" rate has been an attractive lure for advertisers on
free-atlast.com. Advertisers are paying as much as $30 per thousand viewers,
Mr. Packer said, compared with a rate of about $5 to $10 per thousand at
most free ISPs.

Since the ad rates are high, users will have to look at fewer ads than they
do on other free Internet services. Also, Predictive's ads can be turned off
by a mouse click, while most other free ISPs place an unmoveable bar of Web
advertising on the screen at all times.

"The whole goal is to let people get free service that is bearable," says
Mr. Hosea.