Internet firms face grilling from US lawmakers on privacy

Executives from major internet players _ Microsoft, Google, and Facebook, are due for a grilling about online privacy in a Senate committee, an Associated Press report said.

But the company likely to get the most scrutiny is a small Silicon Valley startup called NebuAd, the report said.

NebuAd has drawn fierce criticism from privacy advocates in recent weeks for working with internet service providers to track the online behavior of their customers and then serve up targeted banner ads based on that behavior, the Associated Press report said.

The report further quoted Ari Schwartz, vice president of the Center for Democracy & Technology, a civil liberties group, as saying that NebuAd's business model raises many of the same concerns as an earlier generation of 'adware' companies. Those companies developed software programs that _ when downloaded to a computer _ could track where a user went on the internet and mine that information to deliver customized online ads.

Several NebuAd executives in fact were once employed by Gator, an adware company that later renamed itself Claria, the report said.

Privacy activists say adware companies duped many web surfers into downloading their software programs by bundling them with free screen savers, online games and other internet applications.

But NebuAd has a new twist: It works directly with internet service providers to scan their customers' web surfing habits and deliver ads presumed to be of interest to them, the report said.

British technologists have leveled similar criticisms against a NebuAd-like system being prepared in that country by Phorm.

For its part, NebuAd has stressed that it does not collect any personally identifiable information about consumers and that it requires internet service providers to notify their subscribers about its advertising system, the report further said.