Business Plans

Internet advertisers have been getting a free ride. While the folks who purvey spam and adware have been getting lots of attention, the people behind the products advertised in your inbox or popup window have largely escaped notice. Recent cases brought by the FTC and state authorities have been directed at the people running the ad networks and the email lists. This is a bad policy, and it can’t last. Advertisers need to start worrying too.

With unsolicited email clogging the Internet, the people actually forging email headers, hijacking mail servers and harvesting email addresses from websites have been the natural targets of legal action. The jury is still out on how effective these cases will be in cutting down on spam overall, but they are already producing change by putting Internet ad agencies on the run and forcing them into their lawyers’ offices to achieve compliance with all the new laws and regulations.

But while some companies are looking to go legit, others are just running for the exits – looking to move operations offshore and out of US jurisdiction.

The inevitable result of the schism above will be the development of a two-tier Internet advertising world.

On the one hand will be the “white hats” that do as they should, making the effort and paying out the expense to abide by the law. On the other, will be the “black hats” overseas, spamming with impunity from US authorities.

With the chief malefactors crossing the border, what will the FTC and the states do to curtail illegalities? Ultimately, they will have no choice but to turn their focus on those the border hoppers leave behind – their advertisers. Sure, there will always be offshore gambling houses and similar advertisers just as immune from pursuit as their ad agents, but lots of advertisers will always have brick and mortar operations – and bank accounts – here in the USA. If the authorities turn the light on those advertisers, holding them responsible for how their messages are delivered, the client lists for those overseas agencies will dry up.

But continue to ignore the advertisers, and watch our domestic ad agencies crumble, as the expense of complying with regulations puts them at a fatal disadvantage in the marketplace.

US authorities already have the basic tools necessary to pursue advertisers. CAN-SPAM, for example, is drafted to apply equally to ad agencies and advertisers. And it’s only matter of time before prosecutors will start to use these weapons to enforce the law on all sides.

Advertisers should be gearing up now to deal with the new regime. First, they need to educate themselves on the law and start asking for assurances from their ad agencies that these laws are followed; contracts and insertion orders should have express language requiring compliance. Second, they need to start actually monitoring the conduct of their agents, using only those who meet standards.

The future of Internet advertising should be in the hands of the good guys. And advertisers are the key to making that happen. Only when it’s more lucrative to be a white hat than a black hat will Internet advertising clean up its image.

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