Tests and Scans
Direct Revenue: Greed Triumphs Over Decency
The recent lawsuit filed by the New York Attorney General against Direct Revenue provides an incredible amount of information about the sleazy activities of spyware and adware companies. In the past, we've pointed out that these companies were making lots of money from their invasive installations. We saw a glimpse of how much money was at stake when Claria filed to go public in 2004. In that filing, they revealed that they made about $100 million in 2003. However, that high-profile bid to go public was at the height of Claria's power and profit; they quietly aborted the attempt in the fall of 2004 and just recently announced that they are getting out of the adware business.
Evidence from this most recent suit against Direct Revenue shows that spyware was very, very good to them. In 2004, Direct Revenue made $39 million; in the first 10 months of 2005 they reaped $33 million. Their fascinating internal emails lay bare the priorities of decision makers inside the company. (Many thanks to Ben Edelman for hosting and summarizing these documents.) The documents show the complete devotion to profit at the expense of any other concerns: (Note: most of the links below refer to PDF files submitted as evidence in the lawsuit.)
If there is any justice in this world, the executives of Direct Revenue will be held criminally and financially responsible for the damage they have caused. The top four company officers were paid a combined $27 million during 2004 and 2005 alone. Whatever else happens, this process should not leave that ill-gotten money in their pockets.
Our Direct Revenue Experience
During mid-2005, Direct Revenue's tactics seriously affected PC Pitstop's reputation. The first problem was due to a program named FasterXP that was advertised on our site through Google Adwords. Several users installed the software and got multiple pieces of spyware including Direct Revenue. (If you're interested in seeing the mess this program causes, the lawsuit contains an exhibit with FasterXP screen shots [23MB PDF]). Many users assumed we had chosen to run the FasterXP ad, but we actually had not; in fact, we had no way to even know it was appearing unless someone notified us. Once users reported the problem, we blocked the ad from Google Adwords and notified Google that they should stop running it.
During the same time period, PC Pitstop started receiving angry complaints from users saying that we had installed spyware on their PC and were flooding them with popup ads. Although this puzzled us initially, we finally found the connection. PC Pitstop owns the pctuneup.com domain, which forwarded to PC Pitstop's home page. Direct Revenue created a site named mypctuneup.com that was the only way for users to remove their spyware. To make the removal process harder, DR did not provide a clickable link. Instead, the user had to type in the mypctuneup.com address. When users typed it incorrectly, they ended up on our site and blamed us for their spyware infection. To make sure users knew what was going on, we redirected the pctuneup.com domain to this page explaining the situation. (The lawsuit reveals an internal email discussing the page.)
In an effort to stop this abuse of PC Pitstop's reputation, I contacted Direct Revenue several times to ask about the problems we were seeing. Their designated PR person provided all the standard canned responses designed to deflect and deny responsibility, such as "there are no bright-line standards" but their distributors are required to perform "in accordance with all applicable laws."
Looking into the Direct Revenue scourge a bit further, I found evidence of their software being distributed with what appeared to be child pornography. Although the company clearly knew about my concerns--my email to their PR person is part of the evidence in the case--they did not accept several offers to provide information that would help to determine the distributor. I sent the files in question to the FBI--and then on to Canada's RCMP--for further investigation.
Did the Eliot Spitzer just get lucky and find the only sleazy spyware company with these kind of incriminating emails? I suppose anything is possible, but the odds are that you could find similar messages at all of them. Someone start digging and prove me right!
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