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To parents interested in buying the popular Hooked on Phonics learn-to-read programs, the company made a firm promise on its Web site: It would never sell or rent their personal information to other marketers.

But that pledge was empty. In the pages of a marketing trade publication, Gateway Learning Corp., the product's California-based parent company, was advertising to rent the list of Hooked on Phonics buyers to other marketers.

At a price of $95 per 1,000 names, companies could arrange to have unsolicited advertising sent to 105,936 people who bought Hooked on Phonics in the past year. Included in the information made available to other marketers: ages of the buyers' children.

After inquiries from The Washington Post, the company changed its privacy policy and is no longer promising to keep such data from being offered to others. A company spokeswoman said the firm was simply slow to update its policy. Previous customers would be notified of the change and offered the chance to remove themselves from the list, she said.

View: Complete article at Washington Post
News source: Washington Post - TechNews

Hooked on Phonics is one example of retailers, marketers and an array of service providers expanding their collection and use of consumers' e-mail addresses and other personal information, despite broad assurances to protect individual privacy and honor consumers' choices about how much marketing they want to receive.

Many firms use tactics designed to hide their intent to gather and profit from the data they collect, information that grows in value as more and more people use the Internet for information and shopping.

"Companies continually troll for, and exploit, personally identifiable information," said Joseph Turow, a media professor at the University of Pennsylvania who specializes in mass marketing. "Some Web sites unabashedly collect all the information they can about visitors and market [it] as aggressively as they can to advertisers and other marketers."

But these techniques have drawn scant attention as the flood of unwanted commercial e-mail has reached tidal-wave proportions. Instead, retailers, advertisers and Internet service providers such as Microsoft Corp., America Online and Yahoo Inc. have so far successfully lobbied government regulators to put the spotlight on deceptive practices of the most unsavory purveyors of scams and pornography.

Mallory Duncan, senior vice president and general counsel of the National Retail Federation, argues that mainstream corporations can police their own marketing practices. "The concern with spam is not with the Gap coupon you receive," said Duncan, who represents the largest lobbying and trade group for store owners. "It's the huge amount of porn and other things that were unsolicited."

With the onslaught of spam, almost all companies promise not to sell consumer data. But many don't mention that such information is rented. This means that the list owner won't release the data to an outside marketer, but it will send messages to the list on the outsider's behalf. Targeted lists available for rent number in the thousands, including those from magazines, professional organizations and even political interest groups such as Republicans for Jesus.

Recently, for example, the Christopher Reeve Paralysis Foundation advertised that its list of donors, including postal addresses, was for rent.

A charity spokeswoman said that the rental list includes data only from donors who gave through direct-mail appeals, not online. But she acknowledged that those people were provided no privacy information; the charity's Web site says it will never sell or share e-mail addresses of donors. Direct-mail donors will now be given a chance to remove their names from the donor list, the spokeswoman said, adding that the organization's lists are offered only to "like-minded" groups.

Sometimes, consumers may not be aware they are handing over information to vendors working behind the scenes at certain Web sites.

Take CartManager, a Provo, Utah, company that is one of many providers of "shopping cart" software used by online retailers. Merchants use the service to manage their transactions. Customers select items, put them in virtual shopping carts, and provide appropriate billing and shipping information to complete the order.