Plaxo meets privacy criticism at PC Forum conference [priv]

[Declan McCullagh <declan () well com>]

http://online.wsj.com/barrons/article/0,,SB108034639134766783,00.html?mod=b_this_weeks_magazine_tech_week

Plaxo Blasted at Tech Forum

IT WAS OLD HOME WEEK for some wonderboys of the go-go Internet craze at 
the PC Forum conference in Scottsdale, Ariz., last week. Among the 
attendees were Jeff Bezos, Amazon.com's CEO; Pierre Omidyar, eBay's 
chairman, and Tim Koogle, the former chief executive of Yahoo! But not 
everyone had a good time at the annual thinkfest, run by Esther Dyson, 
chairwoman of EDventure Holdings, publisher of the Release 1.0 
technology newsletter.

Prime example: Koogle was sitting on a panel about the evolution of 
searching on the Internet when the crowd got ugly and turned on him. 
Koogle, who also worked at Motorola and sits on the boards of about a 
half-dozen start-ups, is a director of Friendster, the social-networking 
phenomenon, and a director of Plaxo, a service that updates e-mail 
address books. And it was his affiliation with Plaxo that put him on the 
hot seat.

If you haven't been "Plaxoed" yet, here's how it works: Users of Plaxo's 
free service can download the company's software to their computers, 
which copies the persons' contact database and stores it on Plaxo's 
servers. A user can ask Plaxo to send out a blast e-mail to everyone in 
his address book and ask them to update their information. But when the 
person who receives the message responds, he or she is directly 
connected to Plaxo's Website, which secretly leaves a software probe on 
the recipient's computer. The controversial company has many 
technophiles worked into a lather over a number of issues, including 
privacy, intrusion and trust.

During the question-and-answer period following the panel discussion, a 
number of conferees attacked Koogle as though he were the second coming 
of Bill Gates. One man referred to the company's service as unsolicited 
spam. Others griped that it was simply creepy. Lastly, and perhaps the 
biggest concern, is the issue of what happens to all of that data if 
Plaxo is someday acquired?

For now, Plaxo executives -- who include Napster co-founder Sean Parker 
-- insist that privacy is Job One, and that if the company were sold, 
users would be able to retrieve and erase their data from Plaxo's 
computers before the acquisition was completed. Koogle, who appeared 
taken aback by the verbal onslaught, said not to worry -- even if Plaxo 
were to get snapped up. "If a lot of the company's value proposition 
relies on that trust, the acquiring company will respect that trust," he 
argued.

Most folks in the audience weren't born yesterday; they're sophisticated 
users of technology and the Web. And they surely remember that a similar 
argument was made regarding credit-card information and other data 
submitted to e-commerce outfits during the bubble years. However, once 
the Internet market began to crater, dot-com users found that their 
personal information was being bought and sold as, in turn, companies 
were bought and sold, or they folded.

The audience also wanted to know if the free service had a business 
model yet. To which Koogle responded: not really. The private company is 
experimenting with two different approaches, one aimed at consumers and 
another pointed at corporate users, he said. That didn't instill a lot 
of confidence among the skeptics.

[...]

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