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Markey: Wait on Online-Ad-Service Technology

House Telecommunications & Internet Subcommittee chairman Ed Markey (D-Mass.) told cable operators and other broadband providers to hold off implementing ad-service technology similar to what Charter Communications was planning to use from online-ad network NebuAd.

That came after Charter officially pulled the plug, for now, on testing that service in four markets.

Markey and other members of his subcommittee wrote Charter last month asking it to hold off on the NebuAd partnership until concerns about online privacy were addressed. He praised Charter Tuesday for deciding to delay plans to "track the Web sites visited by their customers and disclose this sensitive the data to an ad firm."

But Markey went beyond that to advise other broadband providers to follow suit. "Given the serious privacy concerns raised by the sophisticated ad-serving technology Charter Communications planned to test-market," he added, "I am pleased to hear that the company has decided to delay implementation of this program, which electronically profiled individual consumer Web usage. I urge other broadband companies considering similar user-profiling programs to similarly hold off on implementation while these important privacy concerns can be addressed.”

Markey's statement was prompted by Charter's official announcement Tuesday that it was not currently proceeding with its test of the NebuAd service in a handful of markets. That announcement, in turn, was prompted by a planned announcement by the Attorney General of Connecticut that proceeding might not be a good idea.

Charter planned to test the service with high-speed customers in Newton, Conn.; Oxford, Mass.; San Luis Obispo, Calif., and Fort Worth, Texas, but it got some questions from customers and push-back from legislators and public-interest groups. It has not ruled out moving forward eventually.

"Our customers are always our first priority," Charter said in a statement Tuesday. "As we do with all new service launches or initiatives, we conducted focus groups well in advance, which told us that most broadband consumers would look upon this service favorably. However, some of our customers have presented questions about this service, as well as suggested improvements. As such, we are not moving forward with the pilots at this time. We will continue to take a thoughtful, deliberate approach with the goal to ultimately structure an advertising service that enhances the Internet experience for our customers and addresses questions and concerns they’ve raised."

"Charter engaged in quick political damage-control after it recognized that the two top U.S. lawmakers who oversee the cable industry were united in opposition to its ad plans," said Jeff Chester of the Center for Digital Democracy. "Both Reps. Markey and Barton sent Charter a very strong signal that its plans to collect information from its broadband customers would be opposed in Congress."

Chester has been pushing the government to look into issues of online privacy and marketing and the effects of media consolidation in the Internet space.

“NebuAd works closely with its ISP partners to customize and improve services to meet their specific business needs and to deliver the best Internet experience possible to consumers," said NebuAd in a statement Tuesday. "NebuAd remains committed to delivering strong value to advertisers, publishers, and ISPs while setting the gold standard for privacy in online advertising. "

The company also pointed out it was continuing to make its case to Washington as well. "NebuAd CEO Bob Dykes has had productive meetings and an exchange of information with Members of Congress and relevant government bodies regarding NebuAd’s service and privacy protections and plans to continue to engage in this open dialogue on consumer privacy protection," the company said. "We welcome the opportunity to continue to discuss consumer privacy protection with government bodies, policymakers, trade associations, and the privacy community.”

NebuAd defended its service last week after Free Press and Public Knowledge released a report, "NebuAd and Partner ISPs: Wiretapping, Forgery and Browser Hijacking," charging that the company was "intercepting" and “altering computer codes."

The company is partnered with various Internet-service providers, including cable operators.

NebuAd countered that the report was inaccurate and mischaracterized its consumer-privacy standards, adding that it does not modify any publisher codes. "Transparency and consumer-privacy protection are core to our business. Reasonable review of materials that have been made available online would have educated the organization that NebuAd requires its ISP partners to provide robust notice to their subscribers prior to deployment of the service," the company said.

“We are pleased that Charter has agreed to cancel its participation in pilot projects with NebuAd ‘at this time,’  said Public Knowledge President Gig Sohn. "However, Charter statement leaves room for participation at a future time.  Should Charter decide to enter into commercial arrangements with NebuAd, it should be on the basis that NebuAd will not intercept customers’ data and plant false code in it."