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We're going to police the wireless space: FTC commissioner

WASHINGTON -- Given the tenor of his comments yesterday, Federal Trade Commission commissioner Jon Leibowitz is not going to give mobile marketers a free pass.

Opening the FTC's "Beyond Voice Mapping the Mobile Marketplace" town-hall event, Mr. Leibowitz highlighted several concerns his agency has with the evolving mobile marketing field.

"[Mobile is] changing the way consumers reach out to businesses and changing the way businesses reach out to consumers," the FTC commissioner told representatives from nonprofits, mobile marketing firms, government officials and media.

Mr. Leibowitz was concerned with several areas.

First was the issue of disclosures. Mobile devices make disclosure even tougher, he said. The increased use of text messaging results in charges that consumers may not be familiar with -- fees for premium text messages, for example.

The FTC was receiving an increasing number of consumer complaints over these fees, Mr. Leibowitz said.

"Simply put, consumers should not short-changed by short codes," he said.

Second was Mr. Leibowitz's issue with mobile advertising. Consumers may resent the number of ads they receive on mobile phones. Text spam causes "further aggravation" to consumers who are charged per spam message.

Another area of "real concern" to Mr. Leibowitz was the use of GPS, or location-based targeting, for advertising.

"The sense that Big Brother -- also your ex-boyfriend -- is watching really raises troubling issues," he said.

Not just the targeting, but also the number of marketing messages sent to mobile consumers based on their location troubles Mr. Leibowitz.

"Personally I worry about clutter," he said.

Finally, the commissioner voiced his concern over mobile marketing to teens.

Offline and online marketing to teens is a key monitoring area for the FTC. The FTC last fall held a similar town hall event on online behavior that informed its regulatory approach to online advertising.

"Mobile tracking and targeting of kids is worrisome," Mr. Leibowitz said.

As mobile commerce in the United States begins to emerge, "consumer protections need to emerge," he said.

But he did concede that wireless carriers are monitoring mobile services. He praised industry lobbies such as the Mobile Marketing Association for its mobile advertising guidelines and CTIA -- The Wireless Association for its location-based services guidelines.

It's a "sound first step," Mr. Leibowitz said.

"Some form of opt-in is crucial -- crucial -- in mobile advertising, especially when location-based advertising is involved," he said.

His final words were a chilling reminder of the reason for this two-day FTC event: to protect the interests of consumers as yet another marketing channel emerges.

The FTC and its sister regulatory agency, the Federal Communications Commission, has held similar exploratory meetings in the past. The end result: the CAN SPAM Act for unsolicited email and the Do Not Call Registry for unwanted telemarketing calls.

"In an era of broadband communications, the FTC is watching," Mr. Leibowitz said. "We're also going to police the wireless space."