Zango

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Zango
Former type Private
Founded 1999
Defunct 2009 (2009)
Headquarters Bellevue, Washington
Key people Keith Smith, co-founder and Chief Executive Officer; Jamie Miller, Chief Financial Officer; Ken McGraw, Executive Vice President, General Counsel and Chief Compliance Officer; Rip Warendorf, Senior Vice President of Sales; Val Sanford, Vice President of Marketing and Product Development; Neal Freeland, Vice President of Online Engagement
Industry Adware
Advertising
Marketing
Products Adware
Revenue Undisclosed
Employees ~100
Website www.zango.com

Zango, formerly ePIPO, 180solutions and Hotbar, was a software company that provided users access to its partners' videos, games, tools and utilities in exchange for viewing targeted advertising placed on their computers.[1] Zango software is listed as adware by Symantec.[2] McAfee states, "this program may have legitimate uses", but describes it as a "potentially unwanted program", and an "adware downloader".[3]

In a personal bankruptcy filing following a January 2009 $4.6 million judgment in favor of a former employee[4], Zango's CEO stated that the company was in default to a bank consortium for over $44 million.[5] On April 20 2009, industry magazine ComputerWorld reported that Zango had "closed its doors". A spokesman for video search engine company Blinkx said that although Blinkx had purchased some of Zango's "technical" assets such as servers, Zango was shut down after the consortium foreclosed.[6][7]

Contents

[edit] Content

Zango's consumer website asserts that the company is "committed to creating a content economy built on a foundation of safe and ethical practices by protecting consumer privacy while offering a fulfilling and high-value content experience." Zango content includes sports, comedy, dance, erotic videos, online games, and screensavers.[8] Warner Bros. and others have been known to provide content, although Warner Bros. has terminated[9] its business relationship with Zango after concerns were raised that children viewing Warner Bros. content could be exposed to advertisements for pornography.[10]

[edit] Undesirable software behaviors

StopBadware.org lists a number of undesirable behaviors associated with Zango Easy Messenger, including "behaves as spyware", "automatically runs on startup", "displays pop-up advertisements", "installs adware", and "bundled software cannot be closed". The same site states, "We find that Zango Easy Messenger is not badware, although it does engage in behaviors that users should be aware of."[11]

Websense issued a Zango-related security advisory in November 2006. The report stated that "Websense Security Labs has discovered a number of user pages on the MySpace domain which have videos that look like they are from YouTube. The videos have an installer embedded within them for the Zango Cash Toolbar. When users click on the video, they are directed to a copy of the video, which is hosted on server sites such as Yootube.info, Yuotube.com, Youtuhe.com, and etc. these all will most likely give you spyware."[12]

A more detailed analysis of this attack appears in "Zango Practices Violating Zango's Recent Settlement with the FTC": "Zango continues numerous practices likely to confuse, deceive, or otherwise harm typical users as well as practices specifically contrary to Zango's obligations under its November 2006 settlement with the FTC." These include failure to include on-screen disclosure of material terms, widespread in-toolbar ads without labeling and hyperlinks, ads for "bogus sites that attempt to defraud users", and third party installations without disclosure.

Automated analysis by McAfee SiteAdvisor in May 2008 reports "629 red downloads — In our tests, we found downloads on this site that some people consider adware, spyware or other potentially unwanted programs." [13].

[edit] History

[edit] 1999 to 2001

When founded in 1999, Zango was known as ePIPO. It was one of the first "pay-to-surf" companies, following in the footsteps of AllAdvantage. This business model paid users a minimal amount to surf the Internet while running an application that showed banner ads. Users could also make money by referring others who would use this application.

After enjoying brief success, the pay-to-surf business model declined with the bursting of the dot-com bubble in 2001. The company, now known as 180solutions, adjusted their technologies in several ways:

  • To show pop-up ads rather than banner ads.
  • To not have any visible GUI.
  • To be bundled with other potentially valuable applications.

[edit] 2002 to 2005

From 2002 through 2005, 180solutions' applications (ncase and 180SA (search assistant)) were distributed via various affiliates. While these affiliates were legally required (by 180solutions contract and other laws) to obtain the permission of the user prior to software installation, many did not, resulting in millions of illegal non-consensual installs. Many other affiliates notified users only via the end user license agreement, resulting in millions more arguably legal but essentially non-consensual installs.

180solutions' software showed pop-up ads while a user was surfing the Internet. This software was often bundled with other pieces of free software which the user intentionally installed. Since permission to install the 180solutions adware was typically hidden in an EULA, most users were unaware they were installing adware. In some cases 180solutions' software was installed as a standalone install. Using this method, an ActiveX prompt simply asked the user to install the software so that they could receive "comparison shopping advertisements".

180solutions contended that the value of the bundled software or the advertisements made up for the inconvenience of the pop-up ads. The value of this trade-off was contested by critics of the adware business model.

In 2004 Benjamin Edelman, assistant professor at Harvard Business School and spyware researcher, analyzed the network behavior of 180solutions applications and claimed they redirected commissions to themselves that were properly due to affiliates, and additionally caused merchants to pay commissions when affected users clicked on merchant sites directly.[14]

During this time, 180solutions' applications were often difficult to uninstall, requiring the user to download an additional uninstall application made by 180solutions or to use an adware removal tool. In 2005, the software uninstall was standardized to use the Windows "Add or Remove Programs" function.

In 2005, 180solutions implemented a number of initiatives to control the distribution of its software and eliminate non-consensual installs:

  • March: Acquired one of their distribution partners, a Canadian company called CDT (dba LoudCash). This gave them direct visibility into and greater control of many of the formerly "third party" distributors.
  • June: Claimed to have re-notified its 20 million user customer base and implemented a program that notifies all users within 72 hours of install and re-notifies all users every 90 days thereafter.
  • August: Filed suit against seven individuals alleged to have illegally distributed its software using a botnet.
  • November: Announced an ongoing partnership with the FBI in breaking up a botnet ring in the Netherlands.
  • December: Ended distribution of the 180SearchAssistant and closed LoudCash (a remnant from the CDT acquisition). They claim that this removes the financial incentive for fraudulent installs, which many critics claim not to be true.

[edit] 2006 to 2008

Despite the initiatives of 2005, 180solutions admitted that it is possible for malicious users to hack their install routines and thus cause fraudulent installs.[15] They claim that the percentage of fraudulent installs has dropped from over 10% to under 1%. Critics claim that the business model is untenable because fraud against 180solutions, which harms unknowing users via non-consensual installs, can never be completely removed.[16]

In early 2008, security researchers at Fortinet reported that the rapidly spreading Facebook widget "Secret Crush" was enticing users to download Zango adware by promising to identify a secret admirer.[17] Zango denied any involvement with the widget, and further investigation by an Infoworld senior writer showed that the Fortinet report was incorrect.[18]

On June 16, 2008 the company laid off 68 of its approximately 200 employees, with three senior executives, Executive Vice President of Corporate Development York Baur, company co-founder Chief Technology Officer Ken Smith, and company co-founder Chief Information Officer Doug Hanhart also leaving. Zango said it was narrowing its focus to concentrate on its new product Platrium, a "casual gaming experience" that shows targeted ads, shopping comparisons and search suggestions based on keywords from the user's Internet browsing.[19][20]

On December 15, 2008, Zango laid off another 50 employees by shutting down their Tel Aviv office.[21] The Tel Aviv office was previously the Hotbar headquarters before the merger of Hotbar and 180solutions.

[edit] 2009

In a personal bankruptcy filing following a January 2009 $4.6 million judgment in favor of a former employee, Zango's CEO stated that the company was in default to a bank consortium for over $44 million.[5] On April 20 2009, industry magazine ComputerWorld reported that Zango had "closed its doors". A spokesman for video search engine company Blinkx said that although Blinkx had purchased some of Zango's "technical" assets such as servers, Zango was shut down after the consortium foreclosed.[6][7] About 10% of Zango's assets were sold to Blinkx, in what the Zango CEO characterized as a "fire sale". When asked about employees, a Blinkx spokesman said "As Zango was insolvent, we believe all the employees were laid off."[5]

[edit] Federal Trade Commission charges and settlement

On January 23, 2006, a public advocacy group filed two official complaints with the Federal Trade Commission. The Center for Democracy and Technology complaints charged 180solutions with engaging in unfair and deceptive business practices, deliberately duping Internet users into downloading intrusive advertising software.[22]

In 2006, the Federal Trade Commission charged Zango with "Deceptive Failure to Disclose Adware", "Unfair Installation of Adware", and "Unfair Uninstall Practices" in violation of the Federal Trade Commission Act.[23] Since the FTC ruling, security researchers continue to find Zango involved in problematic installs.

In November 2006, Zango settled this complaint via a consent decree with the FTC, without formally admitting guilt. In the words of the Federal Trade Commission press release, "Zango, Inc., formerly known as 180solutions, Inc., one of the world’s largest distributors of adware, and two principals have agreed to settle Federal Trade Commission charges that they used unfair and deceptive methods to download adware and obstruct consumers from removing it, in violation of federal law. The settlement bars future downloads of Zango’s adware without consumers’ consent, requires Zango to provide a way for consumers to remove the adware, and requires them to give up $3 million in ill-gotten gains."[24] These restrictions remain in force for twenty years. The agreement also requires respondents Keith Smith and Daniel Todd to notify the FTC of the discontinuance of their current business or employment, or of their affiliation with any new business or employment, for ten years.[25]

In July 2007, Edelman said, "Zango continues numerous practices likely to confuse, deceive, or otherwise harm typical users as well as practices specifically contrary to Zango's obligations under its November 2006 settlement with the FTC."[26]

[edit] Other litigation

In September 2005, attorney Shawn Collins filed a class action lawsuit against Zango on behalf of three plaintiffs, alleging that Zango deceptively installed spyware on more than 20 million personal computers. The company says its software is voluntarily installed by users who download premium content in exchange for their consent to view advertisements relevant to what they search for online. During pre-trial discovery, the parties agreed to a dismissal with prejudice, meaning that the suit cannot be brought again by the same complainants. Each side agreed to pay its own fees and expenses.[27][28][29]

In May 2007, Zango filed a lawsuit against PC Tools alleging tortious interference with its business and trade libel, because the PC Tools product Spyware Doctor at that time classified Zango software as malicious and removed it without informing users.[30][31] Zango dropped the suit after the judge ruled that the suit was "unlikely to succeed on the merits of any of its three causes of action" and refused to grant Zango a temporary restraining order.[32][31]

Also in May 2007, Zango filed in the same court a similar lawsuit against Kaspersky Lab, accusing it of tortious interference, trade libel and unjust enrichment for blocking the installation of Zango software. Kaspersky defended itself by invoking the Communications Decency Act (CDA), saying it was immune from civil liability based on the paragraph of the CDA headed "Protection for 'Good Samaritan' blocking and screening of offensive material". The judge agreed, granting Kasperky's motion for summary judgment.[33][34][35] As of March 2008, Zango was appealing the ruling.[36] As of April 2008, the National Business Coalition for E-Commerce and Privacy was supporting Zango in the appeal.[37] In June 2009, the court ruled that Kaspersky could not be held liable for any actions it took to manufacture and distribute the technical means to restrict Zango software's access to others.[38] [39]

[edit] Installation and removal

Unusual methods of installation and operation have evolved as software such as Zango is targeted to run on a broader mix of applications and platforms. Zango has stated on their website that any Zango "application" can be completely uninstalled by using the Microsoft Windows "Add or Remove Programs" function. However, Zango may appear as a browser plug-in or in some other form which cannot be removed by the officially recommended procedure.

Utilities exist for the purpose of detecting, and in some cases removing Zango-like software. Some software advisers have recommended that individuals seeking to remove Zango-like software from their computers search for instructions specific to their particular platform, application, and installation.

[edit] Variants

[edit] Hotbar

Hotbar (also known as HbTools) is a plugin for Internet Explorer, Microsoft Office Outlook and Outlook Express produced by Zango. Hotbar adds a toolbar and the option of extra skins to these programs. It also allows the user to add emoticons to emails created in Outlook or Outlook Express or check the weather report. Its major revenue comes from the use of pop-ups which are displayed according to a user's behavior and current URL. The application can show over 15 pop-ups a day, depending on how much Internet browsing has occurred.

[edit] Hotbar Premium

Hotbar does have an option to turn off the advertisements, for a fee. The fee-based Premium access also unlocked certain content beyond the preview stage in Hotbar's utilities. Grandfathered Premium accounts have unlimited access, as long as you have saved the activation link when it was purchased. Currently, only 365-day accounts are sold. The accounts are valid only for the Hotbar toolset. That means if you install Zango alongside Hotbar Premium, you will not be served Hotbar's advertising, but will see Zango's Advertising. Currently, Zango does not offer Premium access on any other toolset.

[edit] Controversy

Classified as "Caution - objectionable behavior but clearly informs users" by StopBadware

Hotbar is an example of adware due to its banner advertising and use of pop-up windows. Also the user's browsing habits are sent to the Hotbar servers with a unique user ID which allows a user's browsing habits to be tracked over an extended period of time. For example spyware researcher Benjamin Edelman defined Hotbar's problems like this:

Promoting Hotbar advertising software at sites targeting kids, using banners with smiley faces but without mention of ads. Failing to affirmatively show a license agreement, and burying advertising terms so many screens into the license and below such counterintuitively-labeled section headings that users cannot reasonably find the key provisions. First affirmatively mentioning advertising on a screen that offers no Cancel button for users to decline the installation. And ultimately bombarding users with ads in pop-ups, web browser toolbars, Windows Explorer toolbars, auto-opening sidebars, and even desktop icons.[40]

In 2005–2006, Hotbar.com started to send cease and desist letters to security companies which defined Hotbar as "malware". As a countermeasure, Symantec successfully sued Hotbar.com in the court to get clear right to put it in their "low risk adware"-category.[41]

Hotbar can be detected and removed by several anti-spyware and anti-virus programs, including Windows Defender, Spybot - Search & Destroy, Nod 32, and Norton AntiVirus. However, some utilities do not remove Hotbar completely and leave Windows Registry keys and files behind.[42]

[edit] Seekmo

Seekmo is an adware program by Zango that claims to be a free tool to provide content such as mp3 files, screen savers, and videos. Seekmo can pop up advertisements even if you have a pop-up blocker on your computer, and will monitor your computer usage to generate ads that you are more likely to respond to. In the process, the program can consume processing power and network bandwidth, slowing down your computer and interrupting other programs. Upon downloading a Seekmo-containing file, the program with which you are attempting to access the file will commence the process of license acquisition in which the program (Windows Media Player, for example) will display a window telling you about the content and what Seekmo is. Upon clicking "Accept", it will automatically send a file for download called "Setup.exe". After downloading this file you must install the Seekmo Toolbar which will display advertisements related to the websites you visit.

[edit] References

  1. ^ Zango Ad Services Debuts at ad:tech New York
  2. ^ "Adware. ZangoSearch". symantec.com. http://www.symantec.com/security_response/writeup.jsp?docid=2005-050416-3519-99. Retrieved on 2007-06-13. 
  3. ^ "Threat Profile: Adware-ZangoSA.dldr". us.mcafee.com. http://us.mcafee.com/virusInfo/default.asp?id=description&virus_k=137580. Retrieved on 2007-06-12. 
  4. ^ "Zango goes Bango". Seattle Times. http://seattletimes.nwsource.com/html/technologybrierdudleysblog/2009109821_zango_goes_bango_ceo_bankrupt.html. Retrieved on 2009-06-29. 
  5. ^ a b c Zango's trail of debt woes revealed, Seattle Times
  6. ^ a b Notorious adware vendor Zango shuts its doors, ComputerWorld
  7. ^ a b Zango Shuts Down Operations
  8. ^ zango.com - Tags: Popular - All Time
  9. ^ "Warner Bros. Calls Off Deal With Adware Company". mediapost.com. http://publications.mediapost.com/index.cfm?fuseaction=Articles.san&s=46185&Nid=22075&p=246812. Retrieved on 2007-09-16. 
  10. ^ "Warner Bros. To Cut Link With Adware Firm Zango". Washington Post. http://www.washingtonpost.com/wp-dyn/content/article/2006/07/27/AR2006072701620.html. Retrieved on 2008-07-01. 
  11. ^ "Zango Easy Messenger". StopBadware.org. http://www.stopbadware.org/reports/reportdisplay?reportname=zangomessenger101006. Retrieved on 2008-07-10. 
  12. ^ "Malicious Website / Malicious Code: Fraudulent You Tube video on MySpace installing Zango Cash". websense.com. http://www.websense.com/securitylabs/alerts/alert.php?AlertID=689. Retrieved on 2007-06-24. 
  13. ^ Site Advisor retrieved 17th May 2008
  14. ^ The Effect of 180solutions on Affiliate Commissions and Merchants Benjamin Edelman October 20, 2004
  15. ^ Mea Culpa 180Solutions 5:33 PM, Feb 23, 2006
  16. ^ Non-consensual 180 Installations Continue, Despite 180's "S3" ScreenBenjamin Edelman February 24, 2006
  17. ^ "Zango Pleads 'Not Guilty' in Facebook Adware Flap". Internet.com. 2008-01-08. http://www.internetnews.com/ec-news/article.php/3720436. Retrieved on 2008-07-06. 
  18. ^ "Zango strikes back over reported Facebook hack". infoworld.com. 2008-01-08. http://weblog.infoworld.com/zeroday/archives/2008/01/zango_strikes_b.html. Retrieved on 2008-01-08. 
  19. ^ "68 lose jobs as Zango moves into gaming". Seattle Post Intelligencer. 2008-06-17. http://seattlepi.nwsource.com/business/367388_zango18.html. Retrieved on 2008-07-18. 
  20. ^ Casualties: Zango's recent layoffs include senior execsAlex Eckelberry June 17, 2008
  21. ^ [1] Zango shuts down Tel Aviv office
  22. ^ CDT Files Complaints Against Major Adware Distributor January 27, 2006
  23. ^ FTC complaint against Zango.
  24. ^ Zango, Inc. Settles FTC Charges November 3, 2006
  25. ^ FTC AGREEMENT CONTAINING CONSENT ORDER In the Matter of ZANGO, INC. f/k/a 180SOLUTIONS, INC., a corporation, KEITH SMITH, individually and as an officer of the corporation, and DANIEL TODD, individually and as an officer of the corporation (PDF, 12pages)
  26. ^ "Zango Practices Violating Zango's Recent Settlement with the FTC". benedelman.org. http://www.benedelman.org/spyware/zango-violations/. Retrieved on 2007-08-05. 
  27. ^ "Logan Simios v. 180solutions, CLASS ACTION COMPLAINT" (PDF). U.S. District Court. September 13, 2005. http://www.spywarewarrior.com/classactioncomplaint-180.pdf. Retrieved on 2007-09-05. 
  28. ^ "Zango Spyware Suit Dismissed". ClickZ. September 8, 2006. http://www.clickz.com/3623374. Retrieved on 2007-09-05. 
  29. ^ "Class-Action Suit Dismissed Against Spyware Provider". Chicago Tribune. September 7, 2006. http://www.redorbit.com/news/technology/649021/classaction_suit_dismissed_against_spyware_provider/index.html. Retrieved on 2007-09-05. 
  30. ^ "Zango sues antispyware vendor PC Tools". Infoworld. May 18, 2007. http://www.infoworld.com/article/07/05/18/zango-sues-antispyware-vendor_1.html. Retrieved on 2007-05-19. 
  31. ^ a b "ZANGO, INC., Plaintiff, v. PC TOOLS PTY LTD., Defendant. – Denial of Motion for a Temporary Restraining Order (PDF, 9 pages)" (PDF). U.S. District Court at Seattle. June 5, 2007. http://www.sunbelt-software.com/spyware/zango-pctools-tro-denial-060507.pdf. Retrieved on 2007-09-13. 
  32. ^ "Zango Drops Lawsuit Against PC Tools". Betanews. August 28, 2007. http://www.betanews.com/article/Zango_Drops_Lawsuit_Against_PC_Tools/1188317390. Retrieved on 2007-08-28. 
  33. ^ "U.S. Code Collection: TITLE 47 > CHAPTER 5 > SUBCHAPTER II > Part I > § 230. Protection for private blocking and screening of offensive material". Cornell University Law School. January 3, 2005. http://www4.law.cornell.edu/uscode/html/uscode47/usc_sec_47_00000230----000-.html. Retrieved on 2007-09-05. 
  34. ^ "Zango tries, fails to sue its way out from under the "spyware" label". ars technica. August 30, 2007. http://arstechnica.com/news.ars/post/20070830-zango-tries-fails-to-sue-its-way-out-from-under-the-spyware-label.html. Retrieved on 2007-09-05. 
  35. ^ "ZANGO, INC., Plaintiff, v. KASPERSKY LAB, INC., Defendant. – Dismissal (PDF, 8 pages)" (PDF). U.S. District Court at Seattle. August 28, 2007. http://claranet.scu.edu/tempfiles/tmp33547/zangokaspersky230ruling.pdf. Retrieved on 2007-09-13. 
  36. ^ "Zango's Brief in Zango v. Kaspersky Ninth Circuit Appeal". Eric Goldman's Blog. March 30, 2008. http://blog.ericgoldman.org/archives/2008/03/zangos_brief_in.htm. Retrieved on 2008-03-30. 
  37. ^ "Adware Company Gets Assist From Business Groups In Legal Battle". MediaPost Publications. April 15, 2008. http://publications.mediapost.com/index.cfm?fuseaction=Articles.showArticleHomePage&art_aid=80609. Retrieved on 2008-04-15. 
  38. ^ "Kaspersky Lab Press Releases". Kaspersky Press Release. June 30, 2009. http://usa.kaspersky.com/about-us/news-press-releases.php?smnr_id=900000245. Retrieved on 2009-06-30. 
  39. ^ "Ninth Circuit Opinion". June 25, 2009. http://www.ca9.uscourts.gov/datastore/opinions/2009/06/25/07-35800.pdf. Retrieved on 2009-07-07. 
  40. ^ Benjamin Edelman, May 16, 2005, Hotbar Installs via Banner Ads at Kids Sites
  41. ^ United Press International, March 1, 2006, Symantec settlement riles Hotbar
  42. ^ PC Hell, checked 12.9.2007, Hotbar Removal Instructions and Help

[edit] External links

Retrieved from "http://en.wikipedia.org/wiki/Zango"
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