Charter Backs Off From Spyware Scheme

Charter Communications, facing debt of some $19 billion, has seen its latest cash-raising scheme dashed—at least for now.

The nation’s fourth-largest cabler said it will not immediately roll out technology from Silicon Valley-based NebuAd that it said would “enhance” the Web experience.

But NebuAd’s technology, using deep-packet inspection to serve up targeted ads, goes beyond traditional spyware. Technology consultant Robert M. Topolski, working with Washington interest groups Free Press and Public Knowledge, found that the technology interfered with IP data packets, tweaking cookies to make them appear as if they had originated from sites the users had actually visited. Topolski referred to the tactics as “browser hijacking, cross-site scripting and man-in-the-middle attacks.”

Such actions may be illegal. The Connecticut attorney general sent Charter a tough letter on the issue, as did two key telecom lawmakers, Reps. Ed Markey, D-Mass., the chairman of the House Subcommittee on Telecommunications and the Internet, and Joe Barton, R-Texas.

“I urge other broadband companies considering similar user profiling programs to similarly hold off on implementation while these important privacy concerns can be addressed,” Markey said in a statement.

Charter has said it is still considering plans to raise more revenue from targeted ads.

NebuAd said the Topolski report was inaccurate and that customers receive “robust notice” about the technology. In an interview with technology Web site GigaOM, NebuAd CEO Bob Dykes described the technology as “innocuous” and “consumer friendly.”