Intellectual Property Law

Two powerful House members asked Charter Communications Friday to put a hold on its plans to monitor its customers' web habits in order to serve them targeted ads, questioning whether the scheme complies with federal privacy laws.

In a letter (.pdf) to Charter CEO Neil Smit, Massachusetts Democrat Edward Markey and Texas Republican Joe Barton asked if the company's plan would violate the Communications Act -- which puts strict limits on what cable companies can do with customer records. Charter intends to eavesdrop on what customers type into a search box and what sites they visit. in order to create profiles of their interests. The company, which will make money from the venture, says customers will benefit from the plan.

But the congressmen are not so sure. "Any service to which a subscriber does not affirmatively subscribe and that can result in the collection of information about the web-related habits and interests of a subscriber [...] raises substantial questions," the pair wrote.

They then asked the company to halt the proposed trials in four areas around the country until the company speaks to the congressmen about the plan.

Charter did not immediately say it would put a hold on the program, but in an e-mailed statement, said it would work with the congressmen.

"Our goal is to bring an enhanced Internet experience to our customer while meeting all privacy protection requirements," the statement said.  "We believe we have done that but are pleased to discuss this matter with the chairman and the congressman."

The company ignores the request at their peril.

Barton is the top Republican on the House Energy and Commerce committee, while Markey, a longtime champion of net neutrality, heads up a subcommittee dedicated to telecommunications and the internet.

Charter Communications began announcing the plan to some of its subscribers in letters last week. The company is testing a partnership with NebuAds, which pays ISPs to let it sniff customers' traffic in order to create marketing profiles it sells to net advertising firms or uses to serve its own ads. Charter customers do not seem to be able to opt out of being profiled but can refuse the resulting ads by using an opt-out page that gives them a cookie.

It's not clear exactly how the NebuAd's technology works -- whether it deeply inspects the traffic flowing through the pipes, replaces content in packets sent from a website to a user, or how it communicates in real time with ad networks. It's also not clear how the company analyzes surfing habits, a not insubstantial technical problem, given the size of the web. If the company is looking deep inside web packets, it could easily violate federal wiretapping and privacy laws by snooping -- even accidentally on webmail sessions or web-based internet chat.

NebuAd's president Bob Dykes is on vacation this week and is unavailable to comment until next week, according to a company representative.

Charter's plan is only the most recent attempt of ISPs to find ways to break out of the not particularly exciting or lucrative business of transporting packets to and fro, and find new ways to make money off internet traffic.

See Also:

• Charter to Snoop on Broadband Customers' Web Histories for Ad Networks
• Charter Customer Service Says Not Selling Internet Data
• ISPs' Error Page Ads Let Hackers Hijack Entire Web, Researcher ...
• FCC Gets an Earful From Open-Net Defenders at Stanford

Photo: Congressman Edward Markey