On Friday, the AP broke the story of parental control vendor Sentry using data gathered from children to create marketing data:
Parents who install a leading brand of software to monitor their kids’ online activities may be unwittingly allowing the company to read their children’s chat messages — and sell the marketing data gathered. Software sold under the Sentry and FamilySafe brands can read private chats conducted through Yahoo, MSN, AOL and other services, and send back data on what kids are saying about such things as movies, music or video games. The information is then offered to businesses seeking ways to tailor their marketing messages to kids… The software brands in question are developed by EchoMetrix Inc., a company based in Syosset, N.Y. In June, EchoMetrix unveiled a separate data-mining service called Pulse that taps into the data gathered by Sentry software to give businesses a glimpse of youth chatter online. While other services read publicly available teen chatter, Pulse also can read private chats. It gathers information from instant messages, blogs, social networking sites, forums and chat rooms. EchoMetrix CEO Jeff Greene said the company complies with U.S. privacy laws and does not collect any identifiable information.
Déjà vu. In 2001 I worked for a now-defunct parental control company called N2H2. N2H2 was the top selling filtering vendor to public schools at the time, and decided to take all the data they were gathering on which sites children were visiting, and sell it as marketing data in a program called “Class Clicks.” I wasn’t involved in the planning and execution of Class Clicks, but the thinking was that since this was “anonymous, aggregate data” there were no privacy concerns. The company also felt that since notification about the monitoring and reuse of data was in the product End User License Agreement (EULA), this would also help cover the company. The reality was that these defenses were of almost no use during the PR firestorm that followed, and quickly forced the program’s cancellation, as this 2001 AP story recounts:
(AP) — A major Internet filtering company will stop collecting and selling the Web habits of millions of schoolchildren who use its product after privacy groups howled and the Defense Department had second thoughts. N2H2, which makes the “Bess” Internet filtering software, said Thursday it has stopped selling its “Class Clicks” lists that report the Web sites students visit on the Internet and how much time they spend at each one. After N2H2 announced its deal with marketing research firm Roper Starch last September, privacy groups called the filtering company a “corporate predator” and were incensed over reports the information would be sold to the Defense Department for recruiting.
I took over PR at N2H2 shortly after the discontinuation of Class Clicks, and I spent a lot of time cleaning up after it. It was a PR disaster that haunted the company until its acquisition by Secure Computing in 2003. Class Clicks was included in our competitor’s sales collateral as a reason not to buy N2H2, and was always brought up by our competitors in selling situations.
What’s the takeaway here? Just because what a company is doing with user data is legal, described in the EULA, and anonymous does NOT necessarily mean it’s going to be OK with customers, and won’t protect the company from bad press.
–David Burt
Filed under: Filtering Companies, Internet Safety, Policy | 1 Comment »