• by Wendy Davis  @wendyndavis, March 9, 2005

Companies that install ad-serving software on consumers' computers and serve them pop-ups--such as WhenU, Claria, and 180solutions--bristle at being called "spyware," rather than the more neutral term "adware." But is spyware really the wrong word for such companies? Perhaps not, according to participants in a spyware workshop convened last year by the Federal Trade Commission.

An FTC report on the workshop issued this week, "Monitoring Software on Your PC: Spyware, Adware, and Other Software," stated that panelists and commenters differed widely about whether adware should be considered spyware. Some participants held that the most important factor was whether the software led to the serving of pop-up ads; if so, they argued, then it was spyware. Others argued that the adware/spyware distinction hinges on whether users had adequate advance notice of what the program would do; if so, then it's adware, but if not, spyware's the appropriate name. Still others maintained that adware could only be spyware if it monitored where users went on the Web.

The dispute might sound semantic, but ad-serving companies have indicated that much is at stake--including potential harm to their reputations. WhenU President Avi Naider submitted comments on behalf of the company arguing that it was not spyware: "WhenU has sometimes been accused of being 'spyware.' It is not surprising that some people who do not understand the WhenU technology think that it must be invasive to privacy . . . .. properly understood, WhenU's unique proprietary technology cannot be considered spyware."

Claria also submitted comments arguing that "there is no overlap between 'spyware' and legitimate adware."

On the other side, the Association of Shareware Professionals, an organization for software developers and vendors, weighed in with tongue-in-cheek comments from monthly newsletter Editor Jerry Stern: "First, there's no such thing as spyware. The publishers of spyware would certainly know, and there aren't any publishers who identify their product as spyware, so it doesn't exist."

His written comments went on to detail why the shareware association sees no real differences between adware and spyware: "Both run all the time that your computer is on. Both steal computer speed and Internet bandwidth. But spyware sends information home, and adware may or may not send personally-identifiable information. Overall, both are leeches on your computer that can damage your software installations." In a telephone interview, he said that consumers won't want to purchase software if they associate downloadable programs with ad-serving companies. "They're trying to sell people on buying software and you don't do that by infecting their computers," he said.

And the FTC staff? While the report set out some guidelines--such as that a definition of spyware should include software that's installed without sufficient consent and causes consumer harm--it punted on the adware question: "In FTC staff's view, adware aptly illustrates the challenges associated with developing a workable definition of spyware."