June 2014

Why Online Tracking Is Getting Creepier

Online marketers are increasingly seeking to track users offline, as well, by collecting data about people's offline habits -- such as recent purchases, where you live, how many kids you have, and what kind of car you drive.

Here's how it works, according to some revealing marketing literature we came across from digital marketing firm LiveRamp:

  • A retailer -- let's call it The Pricey Store -- collects the e-mail addresses of its high-spending customers.
  • The Pricey Store brings the list to LiveRamp, which locates the customers online when the customers use their email address to log into a website that has a relationship with LiveRamp. (The identity of these websites is a closely guarded secret.) The website that has a relationship with LiveRamp then allows LiveRamp to "tag" the customers' computer with a tracker.
  • When those high-spending customers arrive at PriceyStore.com, they see a version of the site customized to "show more expensive offerings to them." (Yes, the marketing documents really say that.)
  • Tracking people using their real names -- often called "onboarding" -- is a hot trend in Silicon Valley. "The marriage of online and offline is the ad targeting of the last 10 years on steroids," said Scott Howe, chief executive of broker firm Acxiom. The Direct Marketing Association, which represents the data broker industry, doesn't offer a specific opt-out for onboarding. It does offer a global opt-out from all of its members' direct mail databases, but it only requires members to remove people's data for three years after they opt-out.

Rep Rogers lashes out at tech firms on surveillance stance

House Intelligence Committee Chairman Mike Rogers (R-MI) tore into major US tech firms for their opposition to a House surveillance reform bill that many Internet industry leaders have denounced as too weak.

"We should be very mad at Google, Facebook and Microsoft, because they're doing a very dangerous thing," Rep Rogers said.

The House intelligence chairman charged that by opposing the House version of the USA Freedom Act and calling for more limits on surveillance the American firms are putting their profits ahead of their loyalty to the United States.

"They say, 'Well, we have to do this because we're trying to make sure we don’t lose our European business.' I don't know about the rest of you but that offends me form the words 'European business,'" Rep Rogers said. "Everyone on those boards should be embarrassed and their CEOs should be embarrassed and their stockholders should be embarrassed.....That one quarter [of European market profits] cannot be worth the national security of the United States for the next ten generations."

Sen Rubio Outlines Broad Wireless Broadband Plan

Sen Marco Rubio (R-FL) outlined an ambitious agenda for spectrum reform, which includes plans to introduce three bills: The Wireless Innovation Act to free up government spectrum; a bill directing the Federal Communications Commission to conduct tests in the upper 5 GHz band and modify the rules to allow Wi-Fi so long as it doesn’t create harmful interference to vehicle-to-vehicle (V2V) communications; and a bill to promote wireless infrastructure.

Sen Rubio, a member of the Senate Communications Subcommittee, said that there were a lot of serious policy questions about advancements in high-speed wireless, but what was not debatable was that more spectrum was needed. He said the government should not wait until the current FCC spectrum auctions are over before taking steps to free up more.

His Wireless Innovation Act:

  • Reallocates 200 MHz of government spectrum for commercial use;
  • Establishes an auction pipeline with staggered auctions starting in 2018;
  • Incentivizes federal agencies to reallocate spectrum by allowing portions of the proceeds to be used or conducting research and development, as well as cost and technical assessments on reallocating future spectrum bands;
  • Requires an analysis of requests for new or modified frequency assignments to determine whether a commercial service could be used, whether federal users can share; and
  • Requires [the National Telecommunications & Information Administration] to develop a framework to determine the commercial value of Federal spectrum.

Cantor's shocking loss will be felt in Silicon Valley

[Commentary] The aftershocks of the political earthquake that shook Congress to its core will be felt in Silicon Valley. House Majority Leader Eric Cantor's historic loss in the Republican Virginia primary shattered the Valley's hope that Congress would pass immigration reform.

The tech community needs to adjust to the fact that having Republicans in power no longer means a business friendly government. So tech companies will continue struggling to fill thousands of openings with skilled workers. And House Republicans will continue to block the bipartisan, Senate-passed immigration bill that would nearly double the number of H-1B visas for skilled workers from the current 65,000, among other reforms that are both pro-business and humane.

Streaming the World Cup: Preventing Piracy on the Global Playing Field

[Commentary] With the 2014 World Cup kicking off, there is significant opportunity to engage fútbol aficionados by putting access to the games in their hands -- both literally and figuratively.

Univision’s Spanish-language coverage is disrupting the sports streaming model by eliminating all barriers and providing live, around-the-clock coverage for 56 matches on multiple screens, including TV, online and several mobile platforms, including Unimás and Univision Deportes.

During 2010’s World Cup, Univision reached more than 32 million viewers, and that number is expected to grow across all platforms. We are focused on broadcasting the games to as many viewers as possible and in as many platforms as possible. As new products and providers emerge every day, live-streaming piracy is on the rise and is a challenge that requires serious attention -- yet it also represents a significant opportunity to learn from business intelligence and to deliver on unmet consumer demand.

Here, we explore three key steps to help content owners and distributors disrupt piracy, reengage consumers, and uncover business intelligence from piracy.

  • Good defense: Disrupting piracy and protecting your rights isn’t just about setting up barriers and thinking, “my content is secure now.”
  • Reengage your fans: Give them the stadium experience anywhere and everywhere. People of all ages watch the World Cup.
  • Use data to predict the next move and come up with a better game plan: This step is possibly the most important, because content owners and distributors can’t move ahead unless they know what pirate activity happened during a broadcast.

[Viva is Vice President, Univision; Ragland is Vice President, Irdeto]

US Media Getting Ready for World Cup

The World Cup kicks off in Sao Paulo with home team Brazil going up against Croatia in the opener of the world's most popular sporting event.

All 64 soccer matches will air in English in the United States on ESPN, ESPN2 or ABC. Univision and its associated networks -- UniMas, Galavision and Univision Deportes -- will broadcast the games in Spanish.

Here are some media questions heading into the World Cup:

  • Will the World Cup be profitable for ESPN?
  • Who will turn into TV combatants?
  • Is social media ready for the World Cup?

Growth stalls in readers paying for online news

The media industry failed in 2013 to persuade more customers to pay for its online news services, in spite of experimenting with new ways of charging for content, new research has found.

According to a survey of 19,000 people in 10 countries, conducted by the Reuters Institute for the Study of Journalism at the University of Oxford, only one internet user in 10 was willing to pay for digital news -- exactly the same proportion as in 2012. However, the study did contain some encouraging news for media groups as, even though paying customer numbers remained flat, the proportion willing to commit to subscriptions -- as opposed to one-off payments, day passes or app downloads -- increased.

Of all those paying for online news, 59 percent now have a subscription, compared with 43 percent in 2012. As subscribers generally pay more than occasional customers, they are likely to have boosted the online revenues for many publishers. This phenomenon is consistent with the findings of another report by US research group Pew that concluded “more revenue is being squeezed out of a smaller, or at least flat, number of paying consumers.”

Replacement TV Purchase Decisions Driven by Picture and Sound Quality Despite Introduction of New Features

Consumers worldwide still consider picture quality, sound quality, price, and ease of use to be most important to their upcoming replacement TV purchase decisions. According to the NPD DisplaySearch 2014 Global TV Replacement Study, picture quality is the most important feature for consumers in mature markets making an upcoming replacement TV purchase, with an importance index of 148.

Sound quality follows closely, with an index of 132 (the index compiles responses rating a driver “important” or “most important”; scores above 100 indicate relatively high importance). Price and ease of use ranked nearly as high as sound quality in mature markets, but in emerging markets having a good warranty or service plan ranked higher than both of those.

AT&T accuses Netflix of ‘double-talk’ when it comes to Comcast and Verizon deals

Jim Cicconi, AT&T's senior executive vice president for external and legislative affairs, said Netflix probably has a lot more leverage in its relationship with broadband companies than it's letting on.

"They've been able to get agreements that they obviously like with both Comcast and Verizon," said Cicconi. When a reporter pointed out that Netflix keeps complaining about the deals, Cicconi brushed the objections aside. "Then why on Earth would they have agreed to them? I think that's double-talk," he added. "No company that's in a for-profit business is going to act against its economic interests. Sure, any company would like to pay zero for services they need to deliver their business, but that's not a practical approach." The implication is that Netflix is at least breaking even if not coming out ahead in its negotiations with ISPs.

Why Verizon won’t solve its Netflix problem as soon as Comcast

When Netflix agreed to pay Verizon in “paid peering” deal, it seemed natural to assume that Verizon subscribers would start getting better quality videos within days or weeks. But Netflix performance got worse on Verizon in the month after the paid peering deal was announced. The reason is that the technical teams at Comcast and Netflix spent months working together to lay the groundwork for direct network connections even before the companies' lawyers were done arguing over money. As a result, the engineering teams were able to set the connections up almost immediately after the deal was signed. Verizon, on the other hand, seems not to have done any major technical work until after signing its deal with Netflix.