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  Date Stamp tab - Editorial Wed Mar 1

January 28, 2000

The Trouble with DoubleClick

Privacy advocates contend that the ad company's database strategy is disturbing. A California woman's suit Thursday calls it illegal.

By Diane Anderson


 DoubleClick (DCLK)


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You're online, reading an article about financial planning at a newspaper's Web site. The phone rings. It's a life insurance salesman, pitching you term insurance.

Coincidence or conspiracy?

Or suppose you visit a porn site. Years later, you're subpoenaed about the long-forgotten episode during a child custody battle.

This is a glimpse of the future privacy advocates fear, and that's why they are planning to file a formal complaint against online ad giant DoubleClick (DCLK) for "unfair and deceptive business practices."

They won't be the first. Hariett Judnick filed suit in Marin (Calif.) County Superior Court Thursday against DoubleClick, on behalf of the public. Her suit asks the court to prevent the company from using technology to collect personal information from Internet users without their prior written consent.

DoubleClick, like many other sites, uses cookie technology to obtain "non-personally identifying" information on you as you surf – Internet protocol address, domain type, browser version, operating system, service provider and how you interact with a site and banners on a page. But the company's acquisition of Abacus Direct, a company that owns an immense database on retail purchases and people's addresses and credit cards, uniquely positioned DoubleClick to create a way for marketers to marry offline and online data.

Thus the Abacus Alliance was born. According to DoubleClick, only about a dozen sites are participating in this shared information consortium, but they won't say who those sites are.

"Who appointed them the Big Brother of cyberspace?" asks Jason Catlett, president of Junkbusters, one of the more vocal opponents of the alliance. Junkbusters, the Electronic Privacy Information Center and Privacy International are preparing to file their own complaint with the Federal Trade Commission on Feb. 16.

"Anonymity is important to the Internet as a medium. What you read is private," says Andrew Shen, a policy analyst at EPIC. "Now DoubleClick has switched business models, which will change the entire character of the Web."

Shen likens what DoubleClick is doing with the Abacus Alliance to people following you around a mall with clipboards, recording facts that will make it easy to turn marketing into manipulation.

"The potential for abuse is huge," agrees Dennis Lee, information security trainer at IFsec, an information security consultancy. Lee thinks that there's "only a certain amount of time businesses can do this with impunity."

For its part, DoubleClick doesn't think it should be painted as a villain.

"I don't know why all of a sudden some people think this is an issue," says Jonathan Shapiro, senior VP at DoubleClick. "On Nov. 8 at the FTC hearing, I announced to the world that we were going to be linking online information with personally identifying information."

DoubleClick argues that the sharing of such information benefits customers, relieving them of the burden of seeing the same banner repeatedly and enabling marketers to give individuals promotions relevant to their interests.

"Our research shows that the majority of online users – 67 percent – want targeted advertising ... as long as they know about it and are given a choice," says Shapiro.

Deciding how people get choice is a very contentious issue. Shapiro says DoubleClick's site gives users the chance to opt out for the life of their browser, or until their cookies are erased. The total opt-out pool now totals about 15,000.

But experts say that isn't enough.

"The burden is on the wrong foot," says Shen. "Most consumers have no idea who DoubleClick is. It should be DoubleClick's responsibility to get consent." Even consumers who understand what cookies are might not be aware that DoubleClick is profiling them, tracking their every move on the Net, collecting information into a single repository, combining it with offline data and sharing that data goldmine with third parties.

"Some people realize that Internet browsing creates data exhaust," concedes Catlett. "But they don't like that being vacuumed up by a single company for fear it will come back to haunt them." The data that could haunt people includes information regarding finances, sexual interests, religious interests and political affiliations.

DoubleClick calls its Abacus Alliance a good thing, but its refusal to reveal the participating companies has raised eyebrows. Many suspect that DoubleClick knows people would be upset and take action if they knew the parties involved.

The personalization-vs.-privacy debate is sure to continue. DoubleClick is the dominant Web advertising powerhouse, and it has obvious interests in knowing about viewer response to ads. However, as the news about the complaints broke, DoubleClick saw its market cap drop from $11.9 billion Thursday to $11.1 billion Friday.

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