Charter Drops NebuAd Plans

Charter Communications, the nation's fourth-largest broadband provider, hastily withdrew June 24 from a proposed deal with online advertising company NebuAd to track users' online movements and search queries.

NebuAd, a Silicon Valley startup, counted Charter among its top catches for its consumer Web tracking service. NebuAd's other announced clients include WOW (WideOpenWest), Embarq Holdings Company, Broadstripe, CenturyTel, Metro Provider and other ISPs.

Charter, though, canceled a pilot program with NebuAd scheduled to begin June 15 after a deluge of criticism that began in May with a letter (PDF) from Reps. Ed Markey, D-Mass., and Joe Barton, R-Tex. Organizations Free Press and Public Knowledge issued a report June 18 accusing NebuAd of monitoring, intercepting and modifying the contents of Internet packets as consumers go online. 

The report seems to have been the last straw for Charter.

"Our customers are always our first priority," Charter said in a statement. "We will continue to take a thoughtful, deliberate approach with the goal [being] to ultimately structure an advertising service that enhances the Internet experience for our customers and addresses questions and concerns they've raised."

The Public Knowledge and Free Press analysis (PDF) of NebuAd's program found that the company inserts extra hidden code into a user's Web browser that is not sent by the Web site being visited. In turn, the code directs the browser to another site not requested or even seen by the consumer, where more hidden code is downloaded and executed to add more tracking cookies. Using the secretly collected information, NebuAd serves up ads based on the user's browsing patterns.

"We are pleased that Charter has agreed to cancel its participation in pilot projects with NebuAd 'at this time,'" Gigi Sohn, president and co-founder of Public Knowledge, said in a statement.

Sohn noted that Charter's statement left the company with plenty of wiggle room.

"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," Sohn said.

Both Markey and Barton praised Charter for dropping its NebuAd plans.

"Given the serious privacy concerns raised by the sophisticated ad-serving technology Charter Communications planned to test-market, I am pleased to hear that the company has decided to delay implementation of this program," Markey said. "I urge other broadband companies considering similar user profiling programs to similarly hold off on implementation while these important privacy concerns can be addressed."

Barton added, "Victories on the privacy front are so uncommon that when we win one, it's especially worth celebrating. I hope this one leads to many more, because just the idea that people deserve to have their privacy protected from intrusion is under siege in the digital age."