• by Wendy Davis  @wendyndavis, August 4, 2005

The Federal Trade Commission Wednesday revealed it had readied a complaint against America Online's Advertising.com for installing adware on consumers' computers without adequate notice.

Advertising.com agreed to settle the charges without admitting wrongdoing, and the FTC agreed not to file a court case; both the proposed settlement and draft complaint were made available on the FTC's Web site Wednesday.

The draft complaint charged that Baltimore, Md.-based Advertising.com bundled adware with SpyBlast--a supposed anti-spyware program--without adequately telling consumers that they would receive pop-ups.

Although the complaint didn't give a time frame for Advertising.com's involvement with SpyBlast, an FTC staffer said it allegedly occurred before AOL purchased the company.

AOL spokesman Andrew Weinstein confirmed that Advertising.com had briefly served adware in 2003--before AOL's June 2004 purchase of the company for $435 million. "Advertising.com does not now and will not in the future distribute adware programs," Weinstein said.

The proposed settlement provides that Advertising.com must "clearly and prominently" inform consumers of when it will bundle adware in SpyBlast or other anti-spyware programs. But, since Advertising.com no longer distributes adware, that portion of the settlement appears to be of little practical consequence.

In a move that might carry weight in future adware cases, the proposed settlement also sets out the requirements for clear and prominent notice: "The visual disclosure shall be of a size and shade, and shall appear on the screen for a duration, sufficient for an ordinary consumer to read and comprehend it," states the agreement. "[I]n interactive media, the disclosure shall also be unavoidable and shall be presented prior to the consumer installing or downloading any software code, program, or content and prior to the consumer incurring any financial obligation clearly and prominently."

Late last year, Advertising.com stopped doing business with adware companies, including Claria, WhenU, and 180solutions. The decision came about after AOL reviewed policies regarding adware and software last year, Weinstein told OnlineMediaDaily in February.