Wireless Ads: Who'll Foot the Bill?

The idea of consumers paying for unsolicited ads, a.k.a. junk mail, sounds ludicrous. But in the world of wireless data, where many pricing models exist, it's a possibility.

Some wireless providers charge by the minute for both voice and data services. Others offer data packages that include a set number of text alerts. A slew of unsolicited ads could eat up airtime or transaction allotments.

This possibility spurred Rep. Rush Holt (D-NJ) to begin work on legislation, known tentatively as the Holt Cell Phone Spam Bill, to prevent indirect charges to consumers as a result of mobile e-mail ads. The congressman, who also introduced anti-spam legislation called the Can Spam Act, became concerned about wireless spam this past spring after one of his staff members received an unsolicited ad via a cell phone, said Peter Yeager, Holt's spokesman.

Holt's bill, which has not yet been introduced, is being modeled after a junk-fax law passed in 1991, Yeager said. That statute prohibits sending unsolicited ads to fax machines to spare the machines' owners paper and toner costs.

The advent of the wireless Web and related technical advances has pushed spam and other privacy issues onto the agendas of service providers and vendors, as well as regulators. The emerging capability of locating wireless customers provides one example.

Driven by the FCC's E-911 mandate, vendors such as Ericsson are developing location technology. But the equipment also has commercial applications, such as enabling location-based advertising, which might spur public concerns about the potential misuse of private information.

Ericsson executives are working with wireless providers to ensure that users can make anonymous requests for location-based information, said Tim Connolly, Ericsson director of operator mobile Internet solutions. If, for example, a customer wanted information about Italian restaurants in Manhattan, the provider could supply the customer with a connection to a restaurant guide while concealing his or her identity.

Executives at Paradigm Advanced Technologies, a location-services vendor, also are tracking proposed privacy legislation and related issues.

"We're very much in favor of a handset-based approach," said James Gillen, Paradigm CTO. "The ultimate control about location should be something totally under an on-off capability that the consumer maintains at the originating source."

Service providers must be capable of supplying three levels of privacy to satisfy customers, Gillen said: total anonymity; permission-based sharing of information with trusted parties, such as family members and employers; and subscriber-driven personalization of information and incentives.

"We're talking to Microsoft and other players in the public-network space in terms of trying to standardize location-based protocols between devices and servers to address these issues as best we can on that level," he said. "But there's an end-to-end requirement. You can't just do it on one level."