[Haiko de Poel, Jr.]

Courtesy of Ben Edelman - http://www.benedelman.org/spyware/whenu-utah/

Shawn Schwegman's Affidavit - http://www.benedelman.org/spyware/whenu-utah/schwegman-jun04.pdf

[bedelman]

To give a preview of what Schwegman discusses, my one-sentence summary: "Mr. Schwegman, Vice President of Technology for Overstock.com, explains how spyware has harmed Overstock and its affiliate business partners." This is the first time (that I know of, at least) that affiliate issues have been presented to a court hearing a case about spyware.

[Andy Rodriguez]

Great stuff, I applaud Shawn for a well presented view of how spyware affects merchant's brand and harms the affiliate marketers - BRAVO Shawn !!

A huge step forward.....

[ecomcity]

I applaud Shawns final awakening to the evils of using Overstocks brand to attack his competitors at their point of sale cash registers. After all that is the only reasoning WhenU and their ilk give to their advertisers and pile of commission paying merchants.

ADVERTISE AT YOUR Competition's CASH REGISTER =shove a intrusive advertisement into the face of someone, who has no idea where the Ad came from, interupting their shopping mission or making them question a buy decision at the POINY OF SALE.

In the past when OS was playing this game the BHO perps actually followed NO RULES and even secretly swapped other OS affiliate ID#s with their own. Well it finally struck home that these bundled POS gorilla marketing Ad Whores were so hell bent on infesting & re-infesting systems that they pissed off the actual OS consumers.

Nice piece of Branding there as many of the flavors of the adware BHO's do hidden installs, steal privacy information, key log CC#'s, scrap e-mail addresses and URL traffic pattern stats to sell on the underground advertising market. Heck cybercrime units following the theftware commission money trails find they lead to cybercrinals and even terrorist organizations. The Networks do not monitor, investigate or care how the double dipping theftware/spyware monies get distributed. They feel their legally buffered by imposed ignorance from the consequences of monitizing folks operating spam farms -child porn sites -identity theft rings -copywrite thieves -Credit Card theft rings with hidden partnerships.

That is why Utah decided enough is enough and passed a sysware law with huge fines. This BHO -WhenU - is crying they can't meet the terms of this law. They are crying they are losing infestation partnerships with the likes of Bonzi Buddy, AdDrive, Searchforit, Mindset Interactive, Freeze and many others.... plus the drive-by installers, infecting "10's of thousands new subscribers" monthly. BOO HOO!

Get this out in the media folks as millions of pissed off internet shoppers, whose systems were hijacked, will demand the exact same laws plus other measures for their own States to adopt.

I beg Overstock to stop playing around with this issue. Immediately send out a bold notice e-mail to your 30 milion Opt-In customers with links and education summary. Put a section on your OS site to explain your abhorance to this practice by the BHO's and your competitors like Dealtime and SmartBargains, Sierra Trading Post etc. Place links their to BHO removal tools or even sell the anti-virus detect/removal tools.

Educate your shoppers, Big O-Club members and get millions OS shoppers hitting your site with infested systems ...CLEANED. That will do more for OS in PR then the stupid niceties practiced in a courtroom.

[jc101]

Same here. I applaud Shawn too. Good Job!

[ecomcity]

I waiting the here from OS on this suggestion which would help their shoppers -honest affiliates and kill their competitors BHO gorilla marketing practices....

"I beg Overstock to stop playing around with this issue. Immediately send out a bold notice e-mail to your 20 million Opt-In customers with links and education summary. Put a section on the OS site to explain your abhorance to this practice by the BHO's like Yahoo, AOL -Earthlink and Google did. Place links there to BHO removal tools or even sell the anti-virus detect/removal tools.

Educate your shoppers, Big O-Club members and get millions OS shoppers hitting your site with infested systems ...CLEANED. That will do more for OS in PR then the stupid niceties practiced in a courtroom."

[ecomcity]

Seems the only company employing 6 affiliate managers would take time to address 13,000 affiliates at ABW as things get heated. Is there a gag order in place for OS posting here. Splitting up the small number of tasks between 6 AM's on a program that is 100% automated, except for a few monthly creatives, leaves mucho time for commenting here on suggestions.

[mikew]

Here's an article I found on Yahoo today. Good one:

http://story.news.yahoo.com/news?tmpl=story&cid=528&e=1&u=/ap/20040611/ap_on_hi_te/spyware_law

Here are some good quotes:
<BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>

WhenU.com Inc. claims the law that took effect last month is "arbitrary and Draconian" and violates its free-speech rights.

WhenU lawyers told 3rd District Judge Joseph Fratto Jr. on Thursday that regulation of advertising on the Internet is a matter of interstate commerce subject to federal, not state, jurisdiction.

Interrupting an online transaction to direct activities to a competing business "is the activity the Utah Legislature is trying to prohibit," argued attorney Blake Miller, representing the state. <HR></BLOCKQUOTE>


<BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR> WhenU chief executive Avi Naidern testified that Utah's law could cause the company irreparable financial damage, not only through its "draconian" $10,000 per violation fines, but by driving away partners and clients out of fear they may be liable for violations of the law. <HR></BLOCKQUOTE>

Here's hoping!

And finally:

<BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR> Two Utah companies, Overstock.com and 1-800 Contacts, contend that WhenU ads inundate their Web sites with competitors' ads, costing them millions. <HR></BLOCKQUOTE>

So why would ANY merchant do business with these

[ShawnSchwegman]

I've been in the courtroom all morning listening to everything. I have to go back in a few minutes to testify. Wish me luck...

Take care,

[Thomas A. Rice]

- - - - -
WhenU chief executive Avi Naidern testified that Utah's law could cause the company irreparable financial damage, not only through its "draconian" $10,000 per violation fines, but by driving away partners and clients out of fear they may be liable for violations of the law.
- - - - -

Well, that just sent a pleasure shiver down my spine. That would be a dream come true, IMO.

Never figured I would come down on the same side of an argument as The Big O, it must be freezing down below, LOL...

[Andy]

<BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR> EC wrote: Never figured I would come down on the same side of an argument as The Big O, it must be freezing down below, LOL... <HR></BLOCKQUOTE> Well, you know they have air conditioning down there now!

Daily Chuckle Forum: Engineers In Hell

Regarding the WhenU CEO's comment, I think advertisers should be concerned anyway. Their ads are appearing on sites that do not want their ads, and often popping up on people who do not want to see the ads. All of which creates a very negative impression of the advertiser. Most people won't understand why they're getting the pop ups, or who is actually popping the ads, but they'll remember the company name in the ad.

I think smart companies would be best advised to get out now, before they find themselves in a big PR and/or possible legal mess!

Andy

[Edited for clarity.]

[phillyburbs]

<BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR> WhenU chief executive Avi Naidern testified that Utah's law could cause the company irreparable financial damage <HR></BLOCKQUOTE>

From his lips to God's ears ...

[Zeus]

You have our support Shawn.

[bedelman]

I posted my notes from the hearing.

<BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>
Consistent with case filings, WhenU claimed that the company cannot reliably determine which users are in Utah and which are elsewhere. However, documents presented in the hearing showed that WhenU offers its advertisers the service of showing their ads only in particular locations, including in particular states.

Counsel for the state of Utah also asked WhenU's CEO about WhenU's display of advertising for online gambling and for online liquor sales. My testing demonstrated that WhenU shows such ads in Utah, but longstanding Utah law is thought to prohibit these ads. So WhenU will have to develop -- arguably, already should have developed! -- systems to avoid showing these ads in Utah. WhenU has criticized the Spyware Control Act, claiming that compliance would be difficult and costly. But WhenU must satisfy Utah's gambling and liquor laws independent of the Spyware Control Act. So much for the purportedly high burden of Utah's spyware regulation.

In my own oral testimony, I explained the methods of installation and operation of spyware. In one notable section, I showed videos of WhenU software installed via drive-by downloads with defective license agreements, such that even when a user requested to view WhenU's license agreement, the license was not available.
<HR></BLOCKQUOTE>

[SandraR]

Greetings Ben,

As you may be aware ABW members are in serious need of an advocate attorney. We as a people have small claims and sometimes-larger claims. When will one-person stand up for us as an entity and represent affiliates as a whole. We here at ABW require an attorney ready to fight for the causes that needs the good fight!

Do you have the time and stamina to assist? Or can you lend us a fellow attorney to assist in our needs…. OR is this request falling on deft ears?

I had better add - we are willing to build the required war chest!

[ecomcity]

WhenU plans on going even beyond contextual gorilla advertising by adopting behavioral advertising tricks based upon spyware recording surfing habits with personal buying perferences. Victims then would be served up a WhenU pop while trying to buy a Sony computer at Overstock with a Dell computer counter offer during checkout.

____________________________

Since the format's inception, consumers worldwide have been up in arms over the proliferation of pop-ups on the Web, in many instances not knowing where to place blame. Similarly, many advertisers, including certain big-name brand advertisers, have been instructed to steer clear of the channel because of the negative stigma surrounding it.

New York-based desktop applications evangelist WhenU, a bona fide server of pop-ups, pop-unders, and sliding ads, in an attempt to woo such advertisers weary of pop-up shame, is expected to announce today a new platform that still pops--but without the "up," "under," or "over" aspect.

Called the WhenU Desktop Product Placement Platform, the new unit will run under the same circumstances as other ads in the WhenU network, but without window frames. For example, if a user's Web surfing activity shows an interest in mobile phones, an interactive image of a phone may suddenly appear on the screen, prompting users to click on or close a floating image, instead of a separate window.

WhenU CEO Avi Naider, in a statement, acknowledges that the new platform will stay true to the WhenU theme of showing users comparative ads at point of purchase, or after users display an interest in buying a certain type of product. "Brand marketers want potential and existing customers to see their product, or--better yet--interact with their product at a moment when they are most likely to be interested," he says. "This goes way beyond pop-ups, pop-unders, and other existing methods," Naider adds.

GartnerG2 Principal Analyst Denise Garcia says that the Desktop Product Placement Platform is "basically a pop-up that's not in a browser window you can see." She concedes that the new format is "a more user-friendly version of a pop-up," but notes that recent Gartner research shows that users are becoming increasingly annoyed with floating ads relative to pop-ups--which she says users still find annoying, but no more so than before.

WhenU's Desktop Advertising Network consists of users who opt-in to receive ads in exchange for downloading free software. The WhenU ad-server resides on user's desktops, and serves ads, promotions, and money-saving coupons based on user's Web surfing habits. WhenU's advertiser retention rate is 80 percent, and the number of users in its network has been steadily growing since the new year.

According to the company, tests show that the new ad format clicks through between 3 and 7 percent of the time. Ten advertisers from the consumer packaged goods, electronics, and entertainment sectors have tested the new format.

"I think that for advertisers trying to get away from pop-ups, they'll find this (new format) interesting and perhaps more effective," adds Gartner's Garcia, who points out that the new format has proven to be effective for the advertisers who have tested it. Did you see thta blantent lie about 80% retention ratio on those opting into WhenU since the first of the year. Wow 43 million anxious folks seeking those Ads at the point of sale to wisk them from the checkout lane to go on a wild goose chase.

__________________________________

The Adwhores are busy at work on how to super-glue Ads
on your windshield while at the Cybermall.

[ecomcity]

Heres some more great reads on spyware/adware news http://www.marketingvox.com/archives/categories/intrusive_formats/

[bedelman]

<BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>Originally posted by SandraR:
As you may be aware ABW members are in serious need of an advocate attorney. <HR></BLOCKQUOTE>

Sandra,

Certainly affiliates are being harmed, substantially, by WhenU and other programs that tamper with affiliate commissions. But I can't immediately recommend any particular lawyer here -- choosing counsel is too important to leave to a casual suggestion on a discussion board.

I'm currently working on a major article about the effects of programs, including WhenU and 180 (and perhaps others too), on affiliate commissions. I'll list hundreds of affiliate programs that have allowed these and other such software to join their affiliate programs. For at least some of the affiliate merchants, I'll do what I can to estimate the amount of revenue that the spyware software providers obtain, and the merchants and bona fide affiliates lose, as a result of spyware memberships in affiliate programs. To the extent I'm able, I'll try to explain how we've reached this result -- why it is that merchants are letting spyware companies join their networks. Certainly I'll explain the major effects -- merchants paying affiliate commission where none is due; bona fide affiliates losing commission where it is due; software providers receiving commission for providing minimal service.

In drafting this article, I'd be particularly interested in first-hand experiences, or better yet primary source documents, from readers of this forum and other such forums. Merchants receiving emails from makes of client-side software, asking to join the merchants' programs? Affiliate networks recommending that merchants include WhenU or 180 in merchants' programs? Please send any such experiences or documents to me by email (edelman@pobox.com).

[bobbiek]

Utah judge freezes anti-spyware law

A Utah judge has granted an injunction to adware maker WhenU.com to temporarily halt the state's new anti-spyware law from going into effect.

New York-based WhenU, whose software is the subject of several lawsuits, filed a lawsuit in April to challenge the nation's first anti-spyware statute, called the Spyware Control Act, on the grounds that it is unconstitutional. The suit, filed in the 3rd Judicial District Court in Salt Lake County, Utah, was filed shortly before the law was set to go into effect in May.

"This is an important decision for the entire online advertising industry," said Avi Naider, CEO of WhenU. "Spyware is a problem and we want to put an end to it. WhenU supports anti-spyware legislation at the federal level, but Utah's act unfortunately impairs legitimate online advertising as well."

Representatives for the state were not immediately available for comment.

Utah is the first state to pass a law regulating spyware and other advertising software. "Spyware" and "adware" are rarely clearly defined, but the terms typically refer to software that tracks computer users' actions online or uses a computer's resources to pop up advertisements or other messages.

Many of these programs are bundled quietly with other pieces of software and are sometimes difficult or impossible to find and uninstall. WhenU has said its software can be installed only after people agree to accept terms of service that explicitly describe all of its practices.

Regardless of consent, the Utah law bars companies from installing software that reports its users' online actions, sends any personal data to other companies, or pops up advertisements without permission. It contains some loopholes: Advertisements served by ordinary HTML or JavaScript are exempted, as are the ordinary "cookies" often used to help personalize Web pages.

The bill also bars "context based" tools from triggering unrelated advertisements based on visiting Web sites on a certain topic, a concern that arose from a problem reported by a local contact lens direct marketer.

That has caused worry among some Internet businesses, which are concerned that state laws may unintentionally hamper some means of doing legitimate business on the Net. The Internet Alliance, a trade organization that includes America Online, eBay and Microsoft, has opposed anti-spyware legislation.

In March, 1-800-Contacts filed the first lawsuit under the Utah law, charging that its competitor Coastal Contacts had used WhenU and other adware to deliver ads that infringe on its copyrights and trademarks.