Overture Testing Controversial Ad Plan to Aid Share

By MICHAEL THURESSON
Staff Reporter

Paid listings provider Overture Services Inc., having lost some search engine customers, has quietly turned to a controversial software company to replace some of the audience.

Overture, based in Pasadena, recently began testing software from Redwood City-based Gator Corp., a provider of software that delivers pop-up advertisements to Web users as they surf from site to site.

Some of the targeted sites have objected, claiming copyright infringement. There are also questions about whether Gator's users understand that the software they download will allow their movements to be tracked.

"Gator has a reputation for attaching itself to users' browsers unknowingly," said Matt Bailey, Web marketing director at the Karcher Group, an Internet marketing firm.

"Overture's advertisers could get charged for junk traffic," Bailey said.

In February, Gator settled a lawsuit brought by some of the nation's largest publishers, including the New York Times Co., Dow Jones & Co., publisher of the Wall Street Journal, and the Washington Post Co. The settlement, whose terms weren't disclosed, occurred after a federal judge in Virginia ordered Gator to stop delivering pop-up ads to those companies' sites.

The court held that plaintiffs were likely to prevail on their claim that causing pop-up ads to appear in this manner is an infringement of plaintiffs' trademarks.

Overture, facing increased competition from Google Inc., lost America Online Inc.'s AOL unit, EarthLink Inc. and Ask Jeeves Inc. as customers last year.

Gator, founded in 1998, is a way to increase the number of opportunities to display Overture's ads.

"Our 80,000 advertising customers are constantly asking for new sources for targeted leads. The test so far has been quite positive," said Al Duncan, a spokesman for Overture.

Gator initially became popular for software it provides that saves users' personal information in their web browsers. With Gator, users can move quickly through sites requiring registration or other data input.

Those who sign up also receive a pop-up advertising product called GAIN, or Gator Advertising Information Network. GAIN embeds itself in users' Web browsers and monitors their movements, sending them targeted advertisements.

Gator's marketing director, Scott Eagle, said customers are aware of how its pop-up advertising works. In return for participation, users are able to download free software they would otherwise have to pay for, according to a disclosure of terms and conditions on Gator's Web site.

However, many who download the service don't know that it includes the tracking "spyware," said Doug Heil, a South Carolina Web marketing consultant. He accused Gator of burying the disclosure in fine print, and causing confusion among both users and the Web sites being clicked on when the ads appear.

"Does the everyday user understand what they are downloading when they download Gator? They do not," Heil said. "If they disclosed too much information nobody would download their program."

Duncan declined to say how many of its advertisers are using Gator's software during the unspecified testing period. The company has not decided whether to make its use of Gator permanent, Duncan said.

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