The New York Times reports on targeted advertising based on customer profiles:
The advertiser’s dream of sending a particular commercial to a specific consumer is one step closer to reality as Cablevision Systems plans to announce the largest project yet using targeted advertising on television.
Beginning with 500,000 homes in Brooklyn, the Bronx and some New Jersey areas, Cablevision will use its targeting technology to route ads to specific households based on data about income, ethnicity, gender or whether the homeowner has children or pets.
The technology requires no hardware or installation in a subscriber’s home, so viewers may not realize they are seeing ads different from a neighbor’s. But during the same show, a 50-something male may see an ad for, say, high-end speakers from Best Buy, while his neighbors with children may see one for a Best Buy video game. […]
Cablevision is able to match individual households to demographic data by using information gatherer by databroker Experian. There have significant privacy problems that arise because commercial databrokers, such as ChoicePoint and LexisNexis, build massive profiles (which have included false data) on individuals, including their credit and work histories. Such files can be used for criminal purposes. For example, in February 2005, Choicepoint sold the records of at least 145,000 Americans to a criminal ring engaged in identity theft.
Experian has data on individuals that it collects through public records, registries and other sources. It matches the name and address of the subscriber to what it knows about them, and assigns demographic characteristics to households. (The match is a blind one: advertisers do not know what name and address they are advertising to, Cablevision executives said.)
A particular problem that privacy advocates have seen is inadequate notice to customers about the customer profiling and targeted advertising.
Jeffrey Chester, the executive director of the privacy group Center for Digital Democracy, said this was not enough. “They need to be very clear to the consumer what’s being collected,” he said. “Give people a choice.”
Another company, Invidi, is taking the technology further. Invidi “uses data from remote controls to follow what a person is watching, then matches that with ratings information and program guides to infer that person’s gender and age. It can use census data or data sources like Experian for further refining. Then, it shows an appropriate commercial.”
Though the company has said it does not store the data, there are privacy questions connected with such data gathering in the first place.