The Federal Trade Commission wants to get in on the discussion. In April, the FTC will host a workshop on mobile payments and how the trend will affect consumers in the near future. You know an emerging technology is about to explode when the federal government starts poking its fingers in it. See the details below.

See the agenda below courtesy of the FTC's press department:

• What different technologies are used to make mobile payments and how are the technologies funded (e.g., credit card, debit card, phone bill, prepaid card, gift card, etc.)?
• Which technologies are being used currently in the United States, and which are likely to be used in the future?
• What are the risks of financial losses related to mobile payments as compared to other forms of payment? What recourse do consumers have if they receive fraudulent, unauthorized, and inaccurate charges? Do consumers understand these risks? Do consumers receive disclosures about these risks and any legal protections they might have?
• When a consumer uses a mobile payment service, what information is collected, by whom, and for what purpose? Are these data collection practices disclosed to consumers? Is the data protected?
• How have mobile payment technologies been implemented in other countries, and with what success? What, if any, consumer protection issues have they faced, and how have they dealt with them?
• What steps should government and industry members take to protect consumers who use mobile payment services?

It should be noted that nowhere does the FTC mention near field communications. That should be rectified by the participants in the workshop, who know how the mobile payments vertical is evolving and where it is going.

The event, which will be held in the District of Columbia on April 26 at the FTC's Satellite Building in Northwest Washington, will bring together consumer advocates, industry representatives, academics, technologists and government regulators. The FTC welcomes comments from the public including original research, surveys and academic papers which can be submitted here.

The FTC had a variety of these types of workshops last year, each surrounding a pertinent and potentially troubling technology. There was a workshop on facial recognition and detection technologies and another on debt collection and phone bill cramming. These are all topics of great significance, so it appears the FTC is taking mobile payments seriously. It should. The changing nature of transactions will be one of the greatest shifts in human behavior over the next decade. When a shift of that magnitude takes place, it needs some guidance to make sure that consumers are educated and their interests taken into account.

Photo courtesy of Artur Gabrysiak/Shutterstock

"With Timeline, Facebook has once again taken control over the user's data from the user and has now made information that was essentially achieved and inaccessible widely available without the consent of the user," writes EPIC to the FTC. It urges the FTC to investigate whether Timeline is "consistent with the terms of the settlement."

It's not at all coincidental that shortly after launching Timeline to the world, Facebook decided to ramp up its ad services.

This request comes less than two months after the November 29, 2011 settlement with the FTC in which Facebook agreed to obtain express consent from its users before changing privacy settings. It will also undergo privacy audits every two years for the next 20 years.

Before Timeline, Facebook users posted status updates, links, videos or images, and just expected them to disappear over time. Back then, the only way one could find old content was to keep scrolling down on their profile until it appeared.

Of course, Facebook had previously started surfacing the "old status updates" feature, angering many users.

Facebook Timeline surfaces all of a user's past posts. The good news is that after profiles transition to Timeline, users still have seven days to "clean up" what they don't want to share with their Facebook friends.

The letter from EPIC goes on to mention correlations between the Facebook Timeline "Health and Wellness" item, which suggests that users should update their profiles with life events related to medical data. Facebook has already partnered with major pharmaceutical companies to market drugs and medical treatment.

By exposing one's entire life to Timeline, users "become more vulnerable to stalkers, government agents and potential employers," writes EPIC.

Timeline is Facebook's latest attempt to collect as much information about you as possible, er, to make it easier for *you* to share your life story with all of your Facebook friends.

During the November 2011 FTC settlement, Zuckerberg acknowledged that Facebook had "made a bunch of mistakes in regards to privacy," but it's clear that Facebook does not want to truly be held accountable. As our own Scott Fulton writes, "It's hard to establish a standard of care for property that so many millions of individuals willingly give for free."

Like Spotify and frictionless sharing, Timeline is yet another attempt at getting users to share as much information as possible. What information is too sensitive to share with a Facebook friend network? That is up to the user.

Representatives of the Nuevo Laredo En Vivo forum denied the person was one of their moderators. One of the previous victims was a moderator there.

Popular Egyptian blogger's appeal denied, two 15-day detentions. After denying Alaa Abdel Fattah his freedom, and his demand to be tried in civilian court, the Egyptian military decreed two back-to-back detentions of 15 days each. He remains incarcerated on charges of inciting violence of the military. His mother has started a hunger strike to protest his detainment.

Brazil's "cybercrime" bill will inhibit free expression. This bill, currently in the country's House of Representatives, could make it possible for the courts to "apply criminal penalties to activities like file sharing, peer-to-peer communications, and the fair use of copyrighted works."

Anonymous uses DDoS against El Salvador. The Salvadoran government took its Justice Department website offline in response to an attack by the hacker collective Anonymous

DARPA requests hacker help. The government research agency has issued a call for American hackers to help shore up its cyber-security defenses.

FBI shuts down botnet. With "Operation Ghost Click," the FBI has shut down Esthost, the largest botnet in existence, operating out of Estonia.

Facebook to settle with FTC. The social network is nearing an agreement with the Federal Trade Commission over its misleading shift in privacy settings.

Israeli Knesset bills threaten free speech. The bills defund and otherwise limit the operations of non-governmental organizations in the country, including those that are critical of the government.

Use of Twitter by elite frees foreign reporter in Kyrgizstan. American photographer Nic Tanner was released from detention in Kyrgizstan through a combination of friends, friends of friends and Twitter.

"This is not a story of Twitter's ability to galvanize grassroots protests and marshal ordinary citizens to defend just causes. Kyrgyzstan is a place where high-tech social networks meet old-fashioned patronage networks. All those who got in touch were people we knew personally, and people with some clout. "

U.S. government seizes Twitter info without warrant. Adding to its previous warrantless seizure of Google information on Anonymous volunteer Jacob Appelbaum and others, its latest action did the same to Twitter information.

Salman Rushdie vs. Facebook. Facebook buckled in the face of a high-profile campaign by the Anglo-Indian writer to be allowed to use the name by which he is commonly known on his own Facebook account.

Delhi policy seek preemptive online taps. India, a standout in the crowd of democracies not terribly fond of hearing their own people speak, have come slightly closer to making certain they don't have to. They have proposed setting up a spy agency to eavesdrop on people's Internet and mobile traffic. You know. In case they commit a crime. That should shut 'em up.

U.S. House Judiciary Committee reviews SOPA. The legislation, the Stop Online Piracy Act, is often called the Stop Online Privacy Act by its detractors. A Hollywood-pushed bill, it will make it possible to block whole websites for accidentally hosting copyrighted material. In short, it gives an excess of power to government and law enforcement, which would result in rampant over-reaction and wind up limiting how Americans use the Internet - quite apart from copyright issues. It would also defy precedent and make everyone from ISPs to forum moderators responsible for copyright infringement.

Occupy Wall Street news shared via Storify. Early on in Monday night's raids to shut down the Occupy camp in New York, mainstream media outlets began reporting that the police were barring their reporters from entering the park. Social media, Storify in particular, picked up where the professional media left off.

The use of social media by Syrian protesters. Syria's is among the most violent of the Arab Spring uprisings, the government intractable and the political culture controlled. Syrians are using social media to skirt the suppression of the free flow of information, including mobile.

Overpass photo by Elliot Brown, Colombo photo by Bri

The FTC passed down the proposed settlement claims against DermApps and Acne Pwner, forcing them to pay in total $14,294 and $1,700 respectively to the thousands of people who downloaded the apps from the iTunes store in a belief that it would shape up their skin flaws.

AcnePwner sold for 99 cents and AcneApp sold for $1.99 at the Apple iTunes App Store. They have since been removed from the store. According to FTC records, AcnePwner was downloaded 3,300 times, and AcneApp was downloaded over 11,000 times.

AcneApp based its advertising claims on a study published by British Journal of Dermatology that showed that the use of blue and red lights led to decreases in acne in people who sought that treatment. But that study looked at treatments that blended the use of lights with specific creams and ointments, not with lights only, as the app makers advertised.

The settlements forbids the marketers from making any more claims about the healthful benefits of their mobile apps and other medical devices. AcneApp in particular is barred from misrepresenting research, tests, or studies.

"It's still unclear exactly what the FTC's concerns are, but we're clear about where we stand. Since the beginning, we have been guided by the idea that, if we focus on the user, all else will follow." While the details of the case are emerging, it's clear Google is not facing a traditional antitrust case the way Microsoft did in the late 1990s. For Google, that could make all the difference.

Microsoft: A Different Type of Battle

Microsoft's legal battle with the federal government was essentially about tying Internet Explorer to its Windows operating system. At the time, Windows controlled almost the entire personal computing world, hence Internet Explorer was the de facto choice for Web browsing. In the end, Microsoft was found to be in violation of sections of the Sherman Antitrust Act, which is the statute the feds use to go after monopolies. This is not what Google is facing. Google will be investigated under the Federal Trade Commission Act's Section 5, which deals with deceptive and unfair acts and practices.

"There has not been a successful Section 5 litigated case since 1972," said David Balto, a senior fellow at the Center for American Progress and former policy director for the Bureau for Competition at the FTC.

What is Section 5?

Let's take a closer look at what Section 5 entails. According to the IT Law Wiki, here is the rubric for the FTC's "Policy of Deception:"

1. There must be a representation, omission or practice that is likely to mislead the consumer. This includes the "use of bait and switch techniques." 2. The practice is examined from the perspective of a reasonable person in the circumstances. If the practice "is directed primarily to a particular group," such as Internet users, "the Commission examines reasonableness from the perspective of that group." 3. The representation, omission or practice must be a material one, i.e., it is likely to affect the consumer's conduct or decision regarding the produce or service.

On the "unfair practices" side: "An act or practice is unfair, also in violation of the FTC Act, if it causes injury to consumers that: (1) is substantial; (2) is not outweighed by countervailing benefits to consumers and competition; and (3) consumers themselves could not reasonably have avoided," according to the IT Law Wiki.

When Google says "we are unclear what the FTC's concerns are," it is probably referring to these guidelines in Section 5.

Is Google the Consumers' "Best Friend"?

"Google is the consumers best friend when it comes to operating search," Balto wrote in an email. "Much of what Google does is protecting consumers against sham and deceptive sites ... Consumers realize they are better off with the Google cop on the beat. If these bad guys are demoted it is not an antitrust concern in any respect."

When Balto refers to "bad guys," he is mostly referring to sites and brands that game the Google system, such as J.C. Penny did when it was buying hidden links on websites to improve its search rating. Google caught J.C. Penny and others in this practice and lowered them in the search rankings. As Google has grown, practices like that have increased the scrutiny it receives from an growing number of industry sectors, i.e. travel referral engines such as Kayak.com and Expedia in the wake of Google's ITA acquisition.

Baseline: Is Google Stifling Innovation and Competition?

What primarily concerns us is whether the practices of Google, or any other technology giant, government or regulatory group, stifles innovation and creativity. Search is a powerful tool that has changed the way the world gathers, tracks and assimilates knowledge and interacts with everyday life.

Are Google's search practices stifling innovation? Are they favoring their own products over competitors? Or, is Google just the best tool for the job?

Google's business practices will be put under the microscope, especially the core search product that makes up nearly 66% of search traffic in the United States. One of the key issues, according to The Wall Street Journal, will be if Google "unfairly channels users to its growing network of services at the expense of rivals." Microsoft once went down the antitrust road, and the results were damaging for the software giant. How will Google fare under the federal microscope?

The committee's chairs sent Google a letter on June 10 and asked for a response from Mountain View by June 15. If subpoenas are necessary they would have to be approved by the full Senate Judiciary Committee.

According to Bloomberg, a Google spokesperson said that the company will "send them the executive who can answer their questions." That would be Drummond, who is also Google's senior VP for corporate development and "oversees Google's legal affairs, government relations, corporate development and new business development teams."

Google has never faced such a broad investigation into its practices from the federal government. Within recent years it has run into trouble concerning its acquisitions of AdMob, DoubleClick and ITA, all of which are directly tied to Google search and advertising. Within the last week, Google's $400 million acquisition of AdMeld, a company that focused on return-of-investment optimization of online ad buying, is being investigated by the Department of Justice for antitrust concerns.

The European Union and the state of Texas have launched independent investigations against Google concerning its search and online advertising dominance.

At issue, in part, were Dropbox's Terms of Service that stated that "all files stored on Dropbox servers are encrypted (AES-256) and are inaccessible without your account password." Dropbox recently revised these terms to read simply "All files stored on Dropbox servers are encrypted (AES 256).

The problems with Dropbox's security claims first came to light last month when PhD student Christopher Soghoian published information revealing that Dropbox employees could indeed see the contents of users' files. That's because, in part, Dropbox makes sure that files uploaded to the storage site are de-duplicated. In other words, when a user stores a file on Dropbox, the system checks to see if that user or others have already uploaded that file. If that's the case, then Dropbox simply links to the original file.

As Soghoian points out, other storage sites like Spideroak and Tarsnap do encrypt users' data with a key known only to that person, rather than to one key known just to Dropbox. The trade-off for better privacy and security here is duplicate files - in other words, taking up more storage space. But Dropbox has presented itself as offering customers security and cheap storage, something that the complaint says was actually misleading and confusing to customers.

Soghoian a PhD Candidate at the School of Informatives and Computing at Indiana University filed the complaint with the FTC last week, claiming that Dropbox has misled users and that clarifications made by Dropbox are insufficient. As he noted in his blog post that preceeded the claim, "While the decision to deduplicate data has probably saved the company quite a bit of storage space and bandwidth, it has significant flaws which are particularly troubling given the statements made by the company on its security and privacy page."

Will Dropbox Customers Care?

For its part, Dropbox spokesperson, Julie Supan says that "We believe this complaint is without merit, and raises issues that were addressed in our blog post on April 21."

Although the issue still has to play out before the FTC, there's the chance that it will also have repercussions among Dropbox customers. But as Soghoian noted in his own blog posts, "it would be easy for anyone but a crypto expert to get the false impression that Dropbox does in fact protect the security and privacy of users' data." Whether or not Dropbox customers will care that the encryption isn't quite what was advertised remains to be seen.

This led to a number of lawsuits, as well as a Federal Trade Commission investigation over what were called "deceptive privacy practices" surrounding the way in which Buzz was implemented.

The FTC and Google have finally reached a settlement, both parties have just announced.

Google has faced multiple inquiries in various European nations about its data collection and transfer practices, most notably around Google Street View.

The privacy concerns around Buzz stemmed from the lack of clarity around the service's launch. When the feature was made available, it wasn't clear to users that they were going to be enrolled. Users were given the option to skip joining Buzz - or so it seemed since the choices were "Nah, go to my inbox" and "Turn Off Buzz." But according to the FTC, "Google misrepresentated that consumers who clicked on these options would not be enrolled in Buzz. In fact, they were enrolled in certain features..."

Google now says that users will have to give "affirmative consent" before the company is allowed to change how it shares their personal information. In announcing the settlement this morning, Google apologized and insisted it is "100 percent focused on ensuring that our new privacy procedures effectively protect the interests of all our users going forward."

While those policies will involve all Google products and services, the impact on Buzz may be small as, despite great hoopla on that original launch date last February, the tool seems to have been a non-starter.

In response, both Mozilla and Google have announced changes to their respective browsers todays, with the addition of "Do Not Track" features for Firefox and Chrome.

According to Global Privacy and Public Policy Leader at Mozilla, Alex Fowler, the new Firefox feature will allow users to set a preference that will broadcast their desire to opt out of ad-based tracking. This will be signalled via a Do Not Track HTTP header with every page view or click they make. "We believe the header-based approach has the potential to be better for the web in the long run because it is a clearer and more universal opt-out mechanism than cookies or blacklists."

Fowler says that this effort is an improvement on cookie-based solutions as it's more persistent and doesn't require a user loading lists of ad networks and advertisers for it to work.

The challenge, of course, with the header is that it requires both the browser and websites to recognize and implement the opt-out. "Mozilla recognizes the chicken and egg problem," says Fowler, "and we are taking the step of proposing that this feature be considered for upcoming releases of Firefox."

Chrome & Keep My Opt-Outs

For its part, Google has announced Keep My Opt-Outs, its stab at addressing the new FTC suggestions. Keep My Opt Outs is a Chrome extension that enables you to opt out permanently from ad tracking cookies.

Unlike the Firefox solution that uses the HTTP header, Chrome's answer does rely on cookies and ad networks. But the extension does address the problem that you face when and if you ever clear your browser's cookies - that you lose all your customized settings, including any site you've opted out of. The new extension for Chrome will keep that opt-out permanently.

There are also granular controls for cookies in Chrome, and Google says it's modified its browser's incognito mode to ensure that all cookies, including "Flash cookies" can be blocked. Once you download the extension, you can check your privacy settings here.

Privacy: The New Browser Battle

Microsoft unveiled its plans for a "Do Not Track" feature for IE9 back in December, shortly after the FTC made its announcement about online privacy. So arguably, Mozilla and Google are both playing catch up to Microsoft here.

In a statement, FTC Chairman Jon Leibowitz praised the moves, "Mozilla's initiative is to be commended. It recognizes that consumers want a choice about who is tracking their movements online, and it's a first step toward giving consumers choice about who will have access to their data. It also signals that Do Not Track options are technically feasible."

The response to Google's announcement, however, seemed less favorable. In fact, The New York Times cites an FTC spokesperson saying, "We're pleased that Google is engaged in the process, but Mozilla and Microsoft are clearly steps ahead."

Image credits: Flickr user mollybob

Thankfully, the document published by the Commission is very thoughtful, evenhanded and places great emphasis on supporting the innovation that is made possible when technology companies do have access to user data. Instead of using scare tactics, as some media outlets have done in recent months, the FTC recognizes that different people have different levels of awareness about activity tracking and different degrees of willingness to trade-off privacy for customization and technology innovation. The Commission wisely recommends empowering users to give informed consent to whatever degree of tracking they are submitted to.

-Below, from the FTC's Protecting Consumer Privacy in an Era of Rapid Change

Some consumers are troubled by the collection and sharing of their information. Others have no idea that any of this information collection and sharing is taking place. Still others may be aware of this collection and use of their personal information but view it as a worthwhile trade-off for innovative products and services, convenience and personalization. And some consumers - some teens for example- may be aware of the sharing that takes place, but may not appreciate the risks it poses. In addition, consumers' level of comfort might depend on the context and amount of sharing that is occurring.

The Do Not Track concept is explicitly modeled after the wildly popular Do Not Call registry, a program the FTC implemented in 2003. FTC Commissioner J. Thomas Rosch said in a statement included in today's recommendations that Do Not Track could include some analytics of its own. "Making access to the Do Not Track mechanism depend upon consumers opting in would not only parallel the Do Not Call model," he wrote, "it would give the Commission a much more reliable estimate of the percentage of consumers who really wish to prevent this type of tracking."

What's at Risk

Consumer web use data is a giant gold mine for economic and technological development that we have just begun to discover the beginning of. Never before in history have so many peoples' reading, writing, expressions of interest and communication been quantifiably available for analysis and response, in real time. It's an incredible opportunity that I hope the market will respond to with more than just advertisements. But clearly there are risks and people need to make more informed decisions about how much they expose.

As the FTC recognizes, supposedly anonymous data is rarely impossible to de-anonymize. People have both real and imagined privacy concerns about this data, too.

There is a risk that a campaign to inform people of an option of opting out would be dominated by fear mongers and that the pro-data side will have too little to bring to the table. That would be a big loss for the future, but we would only have our own limited imaginations to blame. Those who looked at data and saw nothing but immediate monetization possibilities and ad targeting put the future of the internet at risk of a major backlash, just like a person who sees every conversation between people as nothing but a sales opportunity probably won't have many friends.

It's only fair, though, to give people the choice. Let's have the discussion about activity tracking data. Ready?

The FTC will host a Twitter chat on this topic today, beginning at noon PST.

FTC Online Privacy Report

The program will implement practices in support of the Self Regulatory Principles for Online Behavioral Advertising, which the industry released a year ago. These principles address questions of choice, security, and accountability and are meant to address the Federal Trade Commission's call for more transparent practices around consumers and behavioral advertising.

The program promotes the use of the "Advertising Option Icon," meant to be displayed within or near online advertisements or on Web pages where data is collected and used for behavioral advertising. The icon will indicate a company's use of online behavioral advertising and its adherence to the principles that guide the program. Clicking on it will provide customers with a disclosure statement about the data collection as well as the ability to easily opt-out.

"Our ability to deliver advertising messages to consumers that speak only to their interests must surely be one of the great benefits of the media revolution that we're living through," says Nancy Hill, President and CEO of the American Association of Advertising Agencies. "We fully understand that this advance in targeting will be lost if the public comes to believe that we are not responsible stewards of the data on which it is built."

Consumer groups have been increasingly vocal about questions of online privacy, and this move is an industry attempt to stay ahead of both negative public sentiment, as well as FTC calls for more regulation.

Sometimes it's something as major as the U.S. Federal Trade Commission going after blogger freebies. Sometimes it's just a drive-by accusation that a blog post is "link bait", and not a useful or genuine contribution to the conversation.

The common thread is this: What responsibility we have to our audiences, when are our own interests in conflict with theirs, and what do we do when that happens?

And a little reader due-diligence doesn't hurt, either. Knowing that a blogger is a political activist, or a real estate agent, or a (ahem) social media strategist means you can assess what you're reading with some knowledge of their agenda. (Even the most well-intentioned among us writes with part of our mind attuned to the potential impact on things we value - whether it's a social cause, our social standing, or a business bottom line.)

Still, I like to suspend my skepticism once in a while. Because one of the things that makes social media so valuable is the chance to connect with genuine human beings, expressing themselves in ways that aren't the result of careful calculations of strategic interests, sales trajectories, keyword analysis or free samples of probiotic yogurt drinks.

And digging for that conflict of interest, while it may protect me from being taken for a ride, also means approaching social interactions with a degree of suspicion... which is a shaky start to a new relationship.

Yes, maybe a blogger's angling for trinkets or traffic. But maybe they're expressing a deeply-held passion. And maybe it's a little of both. Somewhere, there has to be a balance between the benefit of the doubt and a healthy skepticism.

More Noise to Signal.

In its decision (PDF), the FTC acknowledges these changes in the mobile advertising marketplace and notes that it "reached this decision based on important developments in the mobile advertising marketplace, particularly actions by Apple that should mitigate the anticompetitive effects of Google's AdMob acquisition." According to the FTC, the acquisition of AdMob isn't likely to result in a "substantial lessening of competition."]]> Discuss]]> http://www.readwriteweb.com/archives/ftc_clears_googles_acquisition_of_admob.php http://www.readwriteweb.com/archives/ftc_clears_googles_acquisition_of_admob.php Google Fri, 21 May 2010 09:42:13 -0800 Frederic Lardinois The new FTC guidelines for disclosure by bloggers have stirred up some anger among bloggers accustomed to getting free stuff and blogging about it without the heavy hand of governmental Big Brother yadda yadda - oh, you can finish the sentence yourself.

All easy enough for me to say, of course; I have a job and make a pretty good living (touch wood). I can imagine that I might be tempted to modify my views if money was short and a blog review could put another meal on the table for my kids. Then again, for every blogger out there who's struggling to make ends meet, there are countless more blog readers - the people the marketers are really trying to reach. Don't they deserve to know about the relationship between product and blogger when they assess what they're reading?

I'm a fan of disclosure, and while I haven't examined the FTC guidelines in detail, I support the idea in principle.

But it's interesting that the FTC went after bloggers rather than, say, entertainment writers who don't mention the expensive junkets that movie studios take them on. A blogger who has to disclose that she or he received a free package of hot dog weiners has every right to feel burned after dropping fifty bucks to take the family to the latest "THRILLING!" "FANTASTIC!" "SURE-FIRE WINNER!"

More Noise to Signal.

While the FTC will obviously have a hard time enforcing these regulations, there can be no doubt that marketers regularly approach independent bloggers (and especially mommy bloggers) with freebies. When bloggers accept these exchanges, they may not always disclose them in the posts that result. So, while bloggers who are involved in these schemes often tend to say that they would have reviewed the product anyway or that their reviews are often critical, there can be little doubt that payments and freebies influence these stories.

These new rules and rather large fines should bring some bloggers and marketers into line, though others will surely continue to push the ethical boundaries. And blogging Payola is unlikely to go away completely because of these new rules.

This marks the first time the FTC has updated endorsement and testimonial rules since 1980. The new rules also take on celebrity endorsements. If celebrities endorse a product and make false or unsubstantiated claims, or don't disclose 'material connections' between themselves and the advertisers in ads and outside the context of the ads (talk shows, social media, etc.), these celebrities can be held liable under the FTC Act. Judging from this, it would seem that celebrities who tweet about a product they endorse are now risking large fines.