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Presented by:
Internet Advertising:New Ways to Make Money or Promote Your Brand
While Not Getting Sued
Stephen Combs, Esq.Director, LegalHowStuffWorks.com
Kari Moeller, Esq.Senior CounselTurner Broadcasting System, Inc.
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Speaker Kari L. Moeller
Kari Moeller is Senior Counsel with Turner Broadcasting System, Inc.,
Her practice covers areas such as digital and wireless advertising, online behavioral advertising, user-generated content, electronic commerce, consumer data collection and usage, consumer protection, privacy, and data security.
She is a member of the Interactive Advertising Bureau Legal Affairs Council and also manages the Turner Legal Department Pro Bono Program.
Her past experience at Turner also includes handling online intellectual property enforcement matters and managing Turner’s domain name portfolio, during which she was a member of the ICANN Whois Working Group.
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Speaker Stephen Combs
Stephen is Director, Legal at HowStuffWorks, Inc. (www.HowStuffWorks.com), a subsidiary of Discovery Communications, LLC. His responsibilities include managing all legal issues for advertising relationships and content providers.
Formerly an attorney at Morris, Manning & Martin, LLP in the firm’s Technology Law Group, representing leading Internet companies on content licensing, advertising, privacy, and e-commerce transactions.
Corporate Counsel at Home Depot handling IT, privacy, e-commerce, and related issues for www.HomeDepot.com.
Former Co-Editor of “Law of the Internet,” a LexisNexis legal publication dedicated to Internet legal issues; Appeared on “Layman’s Lawyer,” a PBS television show on the topic of the CAN-SPAM Act.
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Agenda
Categories of Advertising
Advertising Examples
Search Engine Marketing
Process and Technology
Pricing Models
Use of Intermediaries/Ad Networks
Legal Process
Privacy Issues
Legal Issues Checklist
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Categories of Advertising
Display Ads
(All Types)
Search Engine Marketing
(Discussed Briefly)
Affiliate Marketing
(Not Discussed-Be Careful)
Email Marketing
(CAN-SPAM)
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Advertising Examples
Banner Ad Expandable Banner or Overpage Unit
Homepage Takeover/Sponsorship
Content Integration Standalone Email Email Campaign
Search Campaign Video Appearing in Banner, Pre-Roll, Interstitial, or In-Stream Unit
Standalone Video (not YouTube.com)
YouTube Video Ad Rich Media Campaign Contest/ Promotion/ Sweepstakes
Campaign in Social Media Mobile or Wireless Campaign
Use of Gaming
Use of Widgets Viral Campaign Advertising/ Promotion with Web Site or Microsite
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Search Engine Marketing (Google)
Google's AdWords
Advertisers buy search keywords and get listed as a “sponsored link.”
Note that "organic search" is the best and least expensive (free) Internet advertising. Have good content on your site, and let Google index your site.
Google's AdSense For Content (AFC)
allows advertisers to pay for ads that are served on publisher's pages with content related to your business.
Google's AdSense for Search (AFS)
is generally the same as AFC except it relates to searches on Google's site or the publisher's site. Ads are displayed alongside search results instead of content.
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Process and Technology
The Parties
Ad Serving Phases
Impression Tracking Models
Publisher, 3PAS, 4PAS and Logging Process
Images Courtesy of Interactive Advertising Bureau (www.iab.net)
Used with permission. Further use, display or copying is prohibited.
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The Parties
Media Company/Publisher
HSW, Turner, etc.
Ad Networks
300 or more players
24/7 Real Media, Yahoo/Blue Lithium, etc.
Agency for Advertiser
Lots of Agencies
Advertiser
Retailers, Manufacturers, etc.
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Process and Technology
Campaign Management Systems
Solbright
Operative
Ad Server Systems
DART
ATLAS
Platform A
Analytics Systems
Omniture
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Process and Technology
Publisher, 3PAS, 4PAS and Logging
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Pricing Models
“Cost Per” PricingCPA (Cost-per-Action)
CPC (Cost-per-Customer)
CPC (Cost-per-Click)
CPL (Cost-per-Lead)
CPM (Cost-per-Thousand)
CPO (Cost-per-Order)
Sponsorships/Share of VoiceFlat Fees
Revenue Sharing on Content% of Ad Revenue
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Use of Intermediaries/Ad Networks
Intermediaries control majority of display inventory; ~30% of revenue
Much lower CPM (<$1 vs. 5x to 30x for premium/direct sales)
Benefits of using Intermediary
Lower transaction costs
Allows clearing excess remnant inventory.
Concerns for Media Companies
Brand impact to media company from low quality ads
Sales channel conflict
Price erosion
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Legal Process
Review of Industry Groups
Insertion Order T&Cs
Potential Insertion Order Issues
Top 10 Gotchas for Insertion Orders
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Review of Industry Groups
Interactive Advertising Bureau (IAB): A national trade association, founded in 1996, that represents the interests of companies that engage in and support the sale of digital advertising. Its members are responsible for selling over 86% of online advertising in the United States.
American Association of Advertising Agencies (AAAA): A national trade association, founded in 1917, that represents the interests of advertising agencies. Its membership produces approximately 80% of the total advertising volume placed by agencies nationwide. Often referred to as the “4As.”
Network Advertising Initiative (NAI) [Discussed Further in Privacy Topic]
The NAI is a cooperative of online marketing and analytics companies committed to building consumer awareness and establishing responsible business and data management practices and standards.
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IAB/AAAA Terms and Conditions
Form IAB/4As Terms and Conditions
Created jointly by the IAB/4As to identify and address key issues in standard digital ad buys.
Do not fully address sponsorships and other buys involving content production or integration, but can be used as the basis for agreements covering those buys.
Where can you find them? The IAB website.
www.iab.net/media/file/standards_termsandcond2.pdf
This is the link to the official terms.
www.iab.net/media/file/standards_educationdoc2.pdf
This is the “cliff notes” version with notes from the drafting committee about the intent behind each section.
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IAB/AAAA Terms and Conditions
Bonus Impressions
If Agency is using a third party server Media Company can’t bonus more than 10% over the impressions guaranteed/cap listed in the IO without prior written consent.
If Media Company does, could be responsible for charges above that 10%.
Catch-22 that sponsorships/share of voice (SOV) buys run for specified dates regardless of over-delivery, unless the IO sets a cap.
Ad Materials
Ad content must comply with site/advertising guidelines and Media Company has broad ability to pull ads (subject to make-goods).
If a campaign doesn’t start due to late creative, Media Company can charge for the wasted inventory.
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IAB/AAAA Terms and Conditions
Confidentiality
The ad description and pricing are confidential.
Third Party Ad Server
Agency can track delivery through a third-party ad server. When a discrepancy occurs:
If it is 10% or less, the agency pays the invoice.
If it is more than 10%, the difference is treated as under-delivery and agency can opt to either accept a make-good or pay off the 3rd party numbers plus 10%.
Reselling
The inventory purchased can’t be resold to a third party.
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IAB/AAAA Terms and Conditions
“Parole Evidence”Only the IO sets out the contract terms. Emails or other correspondence are not binding.
AcceptanceSigning or serving the first ad impression, whichever happens first, means acceptance of the terms.
Ad PlacementMedia Company must comply with any placement requirements or editorial adjacency guidelines in the IO.
CancellationThe IO can be canceled without penalty on 30 days notice before the first impression is served and 30 days notice after the first impression is served, until a straight 14 day notice becomes the later date.
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IAB/AAAA Terms and Conditions
“Without penalty”
Agency doesn’t have to pay for entire campaign – only through effective date of cancellation.
Short rates
Apply to the extent noted in the IO.
Measurement Guidelines
Provide for measurement standards and auditing process
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IAB/AAAA Terms and Conditions
Measurement Guidelines
From IAB/4A T&Cs: “Media Company will make reasonable efforts to publish, and Agency shall make reasonable efforts to cause the 3rd Party Ad Server to publish, a disclosure in the form specified by the AAAA and IAB regarding their respective ad delivery measurement methodologies with regards to compliance with the IAB/AAAA Ad Measurement Guidelines.”
Sets standards for audience measurement in online ad campaigns and for ad campaign reporting (e.g., impressions, caching, and robot and spider filtering.)
Establishes auditing guidelines for how various vendors and media companies should be audited.
Measurement Guidelines can be found at http://www.iab.net/iab_products_and_industry_services/1421/1443/1455
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Top 10 Gotchas for Insertion Orders
1. Editorial adjacencies or other placement restrictions
2. Exclusivity
3. Cancellation
4. Use of third party ad networks/servers
5. Serving, reporting, invoicing
6. Over-delivery or under-delivery penalties
7. IO applies to all ad buys
8. IO automatically renews
9. IO that looks like it is IAB/AAAA terms, but really isn’t
10. READ THE TERMS!
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Key U.S. Laws Affecting Data Privacy
CAN-SPAM Act of 2003
Children’s Online Privacy Protection Act (COPPA)
Federal and State “Do Not Call” Lists
State and Federal Consumer Protection Statutes
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Privacy Issues in Ad Sales
Integrated buys w/ sweepstakes
Surveys
Landing Pages
Mobile advertising
Behavioral targeting
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Self Regulation Affecting Data Privacy
Interactive Advertising Bureau (IAB) Privacy Principles
www.iab.net
Requirements under IAB/4As Terms & Conditions
Network Advertising Initiative (NAI) Privacy Principles
http://www.networkadvertising.org/
NAI recommended disclosures for privacy policies
NAI-Opt-Out Page
Posted Privacy Policy
Applies for Media Company, Advertisers, and Intermediaries
All parties need to disclose privacy practices
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IAB/4As Privacy Terms
“It is Agency’s obligation to submit Advertising Materials in accordance with Media Company’s then existing advertising criteria or specifications (including. . .privacy policies).”
“All personally identifiable information provided by individual web users who are informed that such information is being gathered solely on behalf of Advertiser pursuant to Advertiser’s posted privacy policy is the property of Advertiser, is subject to the Advertiser's posted privacy policy, and is considered Confidential Information. Any other use of such information must be set forth in the IO signed by both parties.”
“Media Company, Agency, and Advertiser shall post on their respective Web sites their privacy policies and adhere to their privacy policies, which abide by the applicable laws. Failure by Media Company, on one hand, or Agency or Advertiser, on the other, to continue to post a privacy policy or nonadherence to its own privacy policy is grounds for immediate cancellation of the IO by the other parties.”
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NAI Privacy Principles
Working with the Federal Trade Commission (FTC), the NAI created a set of self-regulatory industry standards, called the NAI Principles, that mandate how 3rd party advertising networks can use information about users.
The NAI Principles require member companies to provide notice that
Advertising networks may place a 3rd party cookie on your computer; and
Such a cookie may be used to tailor ad content both on the site you are visiting as well as other sites within that network that you may visit in the future.
Member companies must also provide a link to the NAI global opt-out page http://www.networkadvertising.org/managing/opt_out.asp
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Behavioral Advertising
Nov. 2007 - FTC “Town Hall” meeting and subsequent release of draft self-regulatory principles that define “online behavioral advertising” as “the tracking of a consumer’s activities online – including the searches the consumer has conducted, the web pages visited, and the content viewed – in order to deliver advertising targeted to the individual consumer’s interests.”
1st party v 3rd party data collection lines are blurring definitions
E.g., widgets – who is collecting the data? On what web site is it collected?
Proposed do not track list
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Recent Problem Areas
Facebook Project Beacon
Negative PR + consumer backlash for program sharing and posting of behavioral tracking data
Blockbuster
Consumer sued Blockbuster over its participation in the Facebook Beacon program
Specific to video privacy law, but cogent example of why we need to consider all issues with new business methods
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Recent Problem Areas/Developments
Priceline, Travelocity, Cingular Wireless
NYAG case held these three advertisers liable for where/how ads were delivered and displayed by Direct Revenue software
Advertisers required to pay fines and reform practices
Case revolves around adware, but could indicate trend of holding advertisers liable when their ads are delivered via behavioral tracking done by an ad network
Phorm (UK) / NebuAd (US)
New type of targeted ads (ISP targeted or “deep packet inspection”)
System can track every click a person makes online by collecting clicks from user’s ISP
Legal concerns with interception of users’ data without consent
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Legal Issues Checklist
Privacy Policy Disclosures
Advertising Acceptability Guidelines
Legal Review for IOs and Third Party Partners
Privacy Office for Data Collection and Management
Technical Approval Process for Ad Specs and Third Party Partners
Measurement Guidelines and Auditing
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Questions
Q&A
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Contact Information
Stephen Combs
Kari Moeller
Presentation will be posted at
www.technologybar.org
