Listen real close. Bend your ear toward the West coast, Redwood City to be precise, and listen for the sound of tap dancing. Once it begins, it will sound like an entire chorus line of Rockettes performing a new routine to celebrate same-year world championships by the New York Jets and Mets. When you hear that sound, you’ll know the legal cases pending against Gator have been decided.
Scott Eagle, Gator’s chief marketing officer, hasn’t embarked on the victory dance quite yet. He’s well aware legal cases take unanticipated twists and turns and mindful one shouldn’t count chickens before they’re hatched. None of the lawsuits filed against Gator have been ruled upon to date, but a ruling handed down by a federal judge in Virginia last week on a case filed by U-Haul International against WhenU.com signals Eagle is likely to be pleased with the outcomes of the cases filed against Gator.
WhenU.com is a company whose business model closely mirrors Gator’s. Regular readers, if I dare assume there are regular readers out there, will remember last year’s columns about Gator. In them, I described how Gator uses the behavioral data collected from the Web surfing patterns of a Gator user to deliver highly-targeted, highly relevant advertising to that user. In some instances, Gator’s pop-up ads appear when the user is about to make a purchase from a competitor to the advertiser. In other instances, Gator delivers the pop-up at a more subtle, but still effective, moment.
To illustrate, if I have downloaded Gator’s software and am about to buy a 52″ plasma screen TV at Best Buy’s Web site, Gator could pop-up an ad from an advertiser like Circuit City, offering an immediate discount if I click through and purchase the TV from them. More subtly, were Gator able to identify this was the first time I researched plasma screen TVs, Gator might infer I’ve just started the purchasing process. They could wait for a more discreet moment to deliver the Circuit City ad. WhenU.com’s software behaves similarly to Gator’s. Thus, the result of U-Haul’s case against WhenU.com was of significant interest to Gator.
U-Haul accused WhenU.com of violating U-Haul’s trademarks and copyrights. The premise of U-Haul’s suit was WhenU.com does not have the right to pop-up an ad on top of U-Haul’s Web site. The charges were trademark and copyright infringement. In his ruling, Judge Gerald Lee said, “Ultimately, it is the computer user who controls how windows are displayed on the computer desktop.” He went on to say if the user downloaded WhenU’s software, that user “invited” the pop-ups. Hence, WhenU did not violate U-Haul’s trademarks and copyrights.
I called Eagle to ask his impression on the ruling. As anyone who knows him might imagine, Eagle already had a prepared comment or two. “This is the first decision on the merits addressing the Gator Corporation’s pioneering business model and it confirms what we have been saying for years, that our model does not violate Federal copyright, trademark or unfair competition law, and that the consumer owns their computer and has the right to determine what content to display on their computer screen.”
Eagle did not hesitate to draw a direct correlation between the WhenU.com ruling and his company’s future: “U-Haul’s trademark and copyright claims are identical to those in our remaining lawsuits, and so Judge Lee’s decision bodes very well for the remaining Gator cases.”
What I’m about to say isn’t very popular.
I like Gator’s business model. Behavioral marketing has the potential to be extremely powerful. Gator has come closer than anyone to date in achieving its promise. While not perfect, Gator’s business model is permission-based. It provides real value to users and advertisers alike. Gator’s technology is disruptive to business-as-usual and is changing the rules of the game. That stimulates passion among all involved parties.
Businesses have a few available choices. First, recognize Gator’s existence and take advantage of contextual advertising opportunities. Over 800 companies have taken this approach and advertised with Gator, reaching over 36 million active computers on which their software is installed.
Another option is to challenge Gator’s legality. We’ll see the outcome of those cases in the coming months. A final option is to ignore Gator and hope everyone else does, too. This appears to be Ford Motor’s approach. Paige Johnson, a company spokeswoman, told the Wall Street Journal Ford was uncomfortable with the idea its ad might show up when people are on rival sites. She was quoted as saying, “We would appreciate not having everybody do that on our sites. We sort of have the Golden Rule.”
I’m confident Ford shareholders would have a hard time understanding the Golden Rule. The only Golden Rule shareholders understand is they make more gold when Ford sells more cars. Ford should take advantage of ad vehicles that efficiently sell more Ford cars. If Gator can help Ford to do that, Ford should advertise with them.
If Gator cannot help Ford efficiently sell more cars, Ford should not advertise with them. Johnson’s Golden Rule has no place in the decision process. It’s a clear example of personal bias getting in the way of logical business decisions.
Keep your ear to the ground. When you hear the tap dancing start, you’ll know rulings on Gator’s lawsuits have been released. The Gator executive team will tap dance their way down the courthouse steps in a Rockettes-formation kick line.
Now that’s a sight I’d pay to see.
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