Ad-supported software: the good, bad and ugly

by  Alan Zisman (c) 2006 First published in Business in Vancouver May 9-15, 2006; issue 863

High Tech Office


We’re pretty much inured to TV advertising as the price we pay to watch the tube. And I suspect that for most of us, that attitude has carried over to the Internet. Lots of Web pages sport ads ranging from relatively unobtrusive text-only ads alongside a Google search to the large 20-second pop-ups that the New York Times puts in front of some of its content. So-called adware, however, remains controversial. Free software, most often downloaded online, causes ads to pop up on a user’s computer after installation. In many cases, users are unaware that installing this apparently free software will bring them ads.

Often, the pop-up ads are targeted, based on information about the user’s Web searches and surfing that’s sent to the adware companies without the user’s knowledge and consent.

According to spyware expert Ben Edelman, a surprising number of large, respected corporations advertise in this way. In March, he noted that companies including Chase and Citi banks, Sprint and T-Mobile, Travelocity and United Airlines all had ads distributed through adware vendor Direct Revenue. Other well-known advertisers with Direct Revenue included Blockbuster, BMG Music and Sage Software, which develops Simply Accounting locally.

Typically these large companies don’t deal directly with the various adware vendors. They instead keep themselves at arms-length via multiple layers of middlemen. Often their goal is to have ads that pop up when a Web surfer searches for or visits a competitor’s website. However, according to Edelman, this sort of advertising benefits the adware companies more than the advertisers. “When a company hires an adware vendor to promote its site, the adware vendor almost always targets the site’s competitors. So visit T-Mobile on a computer with Direct Revenue installed, and you’ll likely get advertising for Sprint. Then visit Sprint, and you’ll see ads for T-Mobile. It’s clear why the adware vendors like this system – they make money no matter what happens. But for advertisers, the benefits are far less obvious.”

Ad-supported software isn’t necessarily nefarious. I’ve recommended Qualcomm’s Eudora Mail, for instance. It comes in three flavours, a free (and ad-free) feature-light version, a paid (and ad-free) full-featured version and a free “sponsored mode” where users get added features after agreeing to receive ads in a corner of the program window. In this case, there’s a clear user agreement and the ads only appear while Eudora is in use. Too much free software is less open about its advertising connections or about what information about the user is being reported back.

Online privacy watchdog TRUSTe has proposed a set of guidelines and practices for ad-supported software. Among them: users should clearly understand that they’re getting advertising in exchange for free software; paid (but ad-free) versions of the software should be available as an alternative; a complete uninstall option should be available; adware should not run behind the scenes or deceive users about its existence.

Anti-spyware vendor Symantec is starting to identify such “transparent” advertising-based software as low-risk while recommending that users do not need to remove it. However, far too many adware companies and ad-supported programs lack this transparency. They remain what technology consumer columnist Ed Foster has described as “helping fund the plague of intrusive software that threatens the security of our computers and the Internet.”