Advertising Injection: Another Source of Online Legal Controversy

August 31, 2015

Man using digital tabletObservers note that some Wi-Fi “hotspot” operators now use “advertising injection” systems to introduce ads into online content accessed through use of the hotspots.  This process can be frustrating for users of the hotspots.  It also raises multiple legal issues which have yet to be resolved.

Advertising services now enable hotspot operators and other Internet service providers to obtain advertising revenue by injecting advertisements into the content accessed by their users.  This process can be executed by introducing code into the web content accessed by the user.  That code causes advertising content to be imported from outside sources, thus “injecting” ads into the Internet content accessed by the individual users through the hotspot.

Ad injection systems can reportedly also be structured even more intrusively than through injection of code into user content.  It is also apparently possible to re-route all of the hotspot traffic through servers controlled by the ad injection service provider.  At those servers, ads are introduced into the hotspot user’s content.  Under this approach, all users of the hotspot have all of their traffic re-routed to pass through the servers of the ad injection platform.

There are several important legal issues associated with ad injection.  The process can undermine Internet user privacy be making web browsing information available to the ad injection service provider and to the involved advertisers.  The process also alters the presentation of online content, such as websites, without permission from the content owners, and this could raise important legal controversies associated with fair trade practices, intellectual property rights, and online content security.

To the extent that hotspot access is ultimately determined to be a form of broadband Internet access governed by the Federal Communications Commission’s “net neutrality” rules, thus ad injection could constitute a violation of those rules as it arguably unreasonably interferes with and disadvantages Internet content connectivity for consumers.  Ad injection could also be viewed to be a deceptive trade practice on the part of the ad injection service provider and the advertisers involved, thus the Federal Trade Commission and state consumer protection authorities could take action.

Ad injection is a highly controversial commercial practice.  Organizations should consider the legal and business implications carefully before offering or using the service.  Regulatory authorities and courts will likely be asked to evaluate ad injection systems in the near future, and it seems likely that important limitations will be placed on the process.

It is important to note that potential liability associated with the ad injection process rests with all parties who participate in that process.  The hotspot or Internet access provider who permits ad injection to take place could face liability from Internet users, content providers, and regulators.  Similarly, the injection service providers and the advertisers who have their ads injected could also face legal liability from multiple sources.

Ad injection is a risky process, from the perspective of legal compliance.  At a minimum, before making use of the process, hotspot operators and Internet access providers should fully disclose the process to their users and obtain informed consent.  They should also make sure that their terms of service clearly indicate that ad injection may be used.  Given the likely consumer reaction to broader knowledge of the ad injection process, prudence suggests that parties considering use of the process will find it to be in their interest to avoid ad injection.