September 14th, 2007

Web Ad Blocking May Not Be (Entirely) Legal

By Anne Broache and Declan McCullagh
CNet News

Advertising-supported companies have long turned to the courts to squelch products that let consumers block or skip ads: it happened in the famous lawsuit against the VCR in 1979 and again with ReplayTV in 2001.

Tomorrow’s legal fight may be over Web browser add-ons that let people avoid advertisements. These add-ons are growing in functionality and popularity, which has led legal experts surveyed this week by CNET News.com to speculate about when the first lawsuit will be filed.

If ad-blockers become so common that they slice away at publishers’ revenues, “I absolutely would expect to see litigation in this area,” said John Palfrey, executive director of Harvard Law School’s Berkman Center for Internet and Society.

Firefox’s Adblock plug-in is probably the most prominent way to configure Web browsers not to display advertisements. It lets people block ads from individual Web sites such as Doubleclick.net or through configurable directories, like “/banner”. Similar plug-ins are available for Opera, Safari and Microsoft’s Internet Explorer.

The Interactive Advertising Bureau, the lobbying arm for the online ad industry, says it isn’t preparing a legal offensive at this point. Mike Zaneis, the organization’s vice president of public policy, said he wants to work with software developers and consumers to come up with a middle ground on what he describes as an “issue that is just now ripening.”

“We don’t want to go down a route that would seem adversarial at all,” Zaneis said. “People are free to ignore ads, and they often do that, but when you have a third party blocking those ads, that’s the real problem.” He said the IAB is “looking at all the options.”

Ad-blocking tools have been around for years, of course, albeit not without controversy. Nearly a decade ago, a Web software firm called ClearWay Technologies released a beta version of its AdScreen blocking software to threats of boycott from Macintosh-oriented publishers that feared the product would kill their ad-supported Web sites. The company responded by killing the project. Before that, security firm PGP Corp. discontinued an ad-blocking program called Internet Fast Forward because its creator said he had been threatened with copyright lawsuits for modifying publishers’ pages without their permission.

Ad-blocking recently hit the spotlight again when an obscure blogger named Danny Carlton--who expounds fringe political views such as AIDS being a “mythical disease” invented by the U.S. government--banned Firefox users from his Web site. Claiming that Firefox creator Mozilla Corp. has endorsed the Adblock plug-in, Carlton redirected Firefox browsers to Whyfirefoxisblocked.com.

The New York Times wrote about the Whyfirefoxisblocked.com kerfuffle last week, and the CNET Blog Network expanded on the topic from a technical perspective. On Wednesday, Carlton lifted the ban on all Firefox users, saying he found a way to identify only Firefox browsers outfitted with Adblock Plus.

MySpace, LiveJournal: Don’t block our ads
Many Web sites prohibit any kind of ad-blocking in their terms of service agreements. MySpace.com prohibits “covering or obscuring the banner advertisements on your personal profile page, or any MySpace.com page via HTML/CSS or any other means.” Six Apart’s LiveJournal uses similar language, as do some news organizations including the Chicago Sun-Times and Fox TV’s Houston affiliate. CNET News.com does not.

Any lawsuit would likely invoke two arguments--that copyright infringements are taking place (through derivative works), and that the Web site’s terms of service agreement is being violated.

“From a pure legal point of view, a Web site can do anything it wants, so to speak,” said Michael Krieger, an intellectual property and business lawyer with the firm Willenken Wilson Loh & Lieb in Los Angeles. “That’s a little overstating it, obviously, but suppose to get into Google, you first have to click ‘I agree, I’m not blocking ads.’ I think it’s perfectly within their rights to do that.”

In the past, entertainment companies have threatened commercial-skipping products on the grounds that they violate copyrights. ReplayTV, which sells digital video recorders, eventually dropped in 2003 a feature called Automatic Commercial Advance after facing a lawsuit from major TV networks and movie studios over that and other issues. (A judge dismissed the suit the following year.)

It’s not clear whose side the courts would take, if asked. In the famous lawsuit over the VCR from nearly 30 years ago, the movie studios claimed that Betamax users would fast-forward through commercials.

They lost, of course. The 1979 district court opinion estimated that only 25 percent of VCR owners fast-forward through commercials. But it was based on the technology available at the time: what if it was easier and 95 percent of TV viewers did it? (The judge said: “To avoid commercials during playback, the viewer must fast-forward and, for the most part, guess as to when the commercial has passed. For most recordings, either practice may be too tedious.")

A more recent hint about legality comes from a 2003 appeals court decision related to a copyright dispute over the file-sharing service Aimster.

In that opinion, 7th Circuit Judge Richard Posner concluded that, based on earlier court rulings, commercial-skipping creates “an unauthorized derivative work, namely a commercial-free copy that would reduce the copyright owner’s income from his original program, since ‘free’ television programs are financed by the purchase of commercials by advertisers.” By “derivative work,” he was referring to a concept from copyright law that says it’s generally unlawful to make a new work out of an existing copyrighted one without permission.

The second argument claims that a Web site’s terms of service are a “browsewrap” or “clickwrap” agreement that are legally binding. To apply, the notice must be “conspicuous enough to the visitor, so they they’re aware that their visit is governed by these terms,” said Cydney Tune, a lawyer who heads copyright practice at law firm Pillsbury Winthrop Shaw Pittman in San Francisco. (A “clickwrap” license that requires a visitor’s agreement to proceed is more likely to be enforceable, however.)

Still, just because a Web site’s terms of service prohibits ad-blocking doesn’t mean that lawsuits will necessarily ensue. “This is a conversation that comes up a lot,” said Anil Dash, chief evangelist for SixApart, which owns LiveJournal. “We’re not going to chase (them) down. If a kid wants to install a browser and a plug-in on a browser to control their experience, we’re not going to fight them doing that.”

“The truth of it is, very, very few people run ad-blocking software,” Dash said. “Some of them are very vocal about it, but we do respect that.”
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A Fox Interactive Media representative declined to comment about MySpace.com’s terms of service.

While statistics for ad-blocking tools are hard to come by, an estimated 2.5 million users worldwide currently run Adblock Plus, and an even greater number have downloaded the utility, Adblock Plus lead developer Wladimir Palant said in an e-mail interview. He estimated the product is attracting 300,000 new users each month after an initial spike in adoption attributed to people switching over from Adblock, a related utility with a development path that has diverged.

Palant said he believes Adblock Plus is in “no way illegal” and suggested that suing companies like his “out of business” won’t do anyone any good. He added that no one to his knowledge makes money, directly or indirectly, off the software.

In addition, because the source code is publicly available, development would likely continue in another nation with different copyright laws. “The software that I am making is open source, even if I stop working on it--each Adblock Plus user has a copy, and any of them could develop it further,” Palant said. “If the advertisers have a problem, they will not be able to solve it in the legal way. As long as people want to block ads, they will be able to do this.”

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