The Hidden Money Trail

From Adware to Nowhere?

If adware companies don't clean up their act, Uncle Sam might do it for them. Congress is considering a handful of anti-spyware bills, including the Spy Block Act (S. 687) and the Spy Act (H.R. 29). Both would penalize companies that engage in deceptive practices, secretly install software or secretly collect data about users, or make software difficult to remove. Senate Bill 687 has yet to be voted on, while the Spy Act has passed the House and was in Senate committee at press time.

Consumer advocates aren't optimistic about the proposed regulations. "Laws alone won't do that much to stop spyware," cautions Ari Schwartz, associate director of the Center for Democracy and Technology. Schwartz says spyware legislation will likely make some forms of intrusive behavior lawful.

With an eye toward compliance with the potential adware laws, some adware companies are trying to use less-obtrusive, or more-targeted, ads to convince users to keep the apps.

Earlier this year Claria announced its BehaviorLink adware program. Instead of delivering pop-ups, it will embed highly targeted ads into pages on Web sites that have signed up with the company. So if you just had a baby, for example, prepare for a steady diet of diaper and infant-formula ads.

Claria manages this process by collecting a trove of non-personally identifiable data about each user, such as marital status, zip code, age range, and gender. Mainstream applications, such as instant messaging clients and media players, will bundle BehaviorLink.

"We don't want to be on 40 to 50 million desktops, we want to be on 140 million to 250 million desktops," says Scott Eagle, Claria's director of marketing.

WhenU's Save app targets ads based on a user's surfing habits, says president Avi Naider, but Save doesn't send that data to WhenU--it stays on your PC.

Naider says he hopes that cleverly designed, targeted ads and an unusual level of openness about his company's business practices will convince users to keep WhenU installed.

"Given the history of the adware industry, we have to do an over-the-top good job of protecting users' privacy if we're to gain their trust," he says.

Real change in adware practices may be on its way. But until most PC users are convinced that adware makers have truly changed the way they do business, trust in these vendors' promises may remain elusive. And one way or another, the ads will keep on coming.