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Mark Grossman


30 January 2004

How much private information are you willing to give away for a freebie or discount? Do you mind having all your drugstore purchases tracked for a markdown? People complain about the lack of privacy in our digital world and yet they seem all too willing to give away their secrets for a pittance. Maybe it's ignorance about what they're giving away, so let's dispel some of that.

I haven't seen this as much in South Florida as other parts of the country, but many stores have discount programs that require you to give the cashier a small card with a barcode as you checkout. The barcode identifies you, which gives them the ability to record and study your purchasing patterns. In return, you get a small discount on your purchases.

In some ways, it strikes me as a fair deal. You give the store the ability to market to you better because they know what you like and you get a discount. The problem I have with this is so few consumers really understand what it is they are giving away. After all, it's not like the drugstore or supermarket has a big warning sign that says, "By signing up for this program, you agree to let us collect personal information about you, use it to our advantage, and sell it to whomever we want, whenever we want."

If you think that can't be the deal because there "must be a law," you're sadly mistaken. There is very little in the way of privacy protection in the United States. Most of your protection comes from educating yourself about privacy issues.


It shouldn't be surprising that these issues follow you onto the Net. The biggest culprit is what's called "spyware." Despite the name, it's legal.

It often comes in the form of "free" software that performs some useful function. You want the functionality, so you install the freebie. What you're often not told is that you're "paying" for the "freebie" by letting them spy on your Internet activities.

Defining "spyware" isn't easy. The best definition I've found comes from Steve Gibson, a well-known software entrepreneur. He says, "Silent background use of an Internet 'backchannel' connection MUST BE PRECEDED by a complete and truthful disclosure of proposed backchannel usage, followed by the receipt of explicit, informed, consent for such use. ANY SOFTWARE communicating across the Internet absent these elements is guilty of information theft and is properly and rightfully termed: Spyware."

He goes on to say that, "The number one reason for declaring software to be 'spyware' is that it sneaks into the user's system and communicates secretly. This is never going to be okay. . . .Since the goal is to inform the user, burying

this information beneath a mountain of legal mumbo-jumbo, then claiming to have 'informed the user', misses the mark."

Like the barcoded card at the drugstore, spyware isn't all bad. You make a tradeoff between your information and something else of value you're getting. Of course, this assumes that you understand the tradeoff after a full disclosure. As Steve Gibson said, the issue is that spyware "sneaks" onto your system.

Still, "sneaks" is in the eye of the beholder. One product that's received a bunch of attention is the Gator(sm) eWallet ( It's software that makes surfing easier because it remembers things like Web site passwords for you.

The home page tells you that it, "Fills in FORMS with no typing." "Remembers PASSWORDS automatically." It sounds great. I know that it's a pain to fill in those long forms on the Net. This is the answer to not having to type your address repeatedly.

Gator discloses the tradeoff in innocuous language. "The Gator eWallet comes bundled with OfferCompanion(sm) separate software - your direct link to some of the Web's most valuable offers." Hummmm.

So, let's jump in what Steve Gibson calls the "legal mumbo-jumbo" to see what the tradeoff is.

In its privacy policy, "While we don't know the identity of [our] users, [our software] and [we] anonymously collect and use the following kinds of information: Some of the Web pages viewed; The amount of time spent at some Web sites; Response to the ads displayed; Standard web log information (excluding IP Addresses) and system settings; What software is on the personal computer; First name, country, and five digit ZIP code; Non-personally identifiable information on Web pages and forms; GAIN-Supported Software usage characteristics and preferences."

I don't know about you, but the legal mumbo-jumbo seems to say a bit more than the innocuous statement about "your direct link to some of the Web's most valuable offers."

My advice is that before you install any "free" program, you should do some research to learn whether it includes spyware. What's distressing is that while it's easy to give the advice, you may find that its practical application is difficult because these companies labor to cloak their spying.

Spyware is republished from
Mark Grossman
Mark Grossman