A diverse coalition of advocacy groups and Internet watchers is trying to derail ZapMe! Corp., a firm that brings online advertising into schools.
The group -- encompassing Web-privacy experts, Phyllis Schlafly's conservative Eagle Forum, Ralph Nader's left-leaning Commercial Alert, and 24 other organizations and media watchdogs -- charges that ZapMe (Nasdaq: IZAP), a San Ramon, Calif., company that has contracts with 6,000 schools, is helping advertisers collect the names and addresses of minors for marketing purposes without parental consent.
In letters being sent Wednesday to governors and state legislators, the group calls for new state laws mandating parental approval. Federal law prohibits online gathering of identifying information about children under 13 years of age without parental consent, but many students exposed to ZapMe are older than that.
The letters also call on a dozen of ZapMe's advertisers and corporate partners -- including software concern Microsoft Corp. (Nasdaq: MSFT), of Redmond, Wash., and computer retailer Dell Computer Corp. (Nasdaq: DELL), of Round Rock, Texas -- to withdraw advertising on the ZapMe Web site and sever ties with the company.
'Only broad demographic information'
ZapMe Chief Executive Rick Inatome said the company doesn't furnish data on individual students to advertisers, only broad demographic information. ZapMe sponsors can solicit names and other personal data from students while at school, but that isn't any different from other Web advertisers, he said.
ZapMe offers the schools Web access and $90,000 each of high-tech equipment free -- including computers, maintenance and support -- in return for schools' agreement that the computers will be used at least four hours a day -- flashing ads on the bottom left-hand corner of the screen.
Schools collect the ages, genders and ZIP codes of student users. The schools also agree to distribute take-home material to students at least three times a year, such as sponsors' advertising, or contests and promotions.
Last year, California adopted a statute aimed at ZapMe, which prohibited school districts from allowing electronic advertising in classrooms without a public hearing and parental notification.
Jason Catlett, president of Junkbusters Corp., a Green Brook, N.J., consulting firm on privacy issues, said ZapMe advertisers likely are compiling "enormously detailed pseudonymous" profiles on student users. If ZapMe's confidentiality policy changes, or the information leaks, Catlett said, students' privacy could be invaded.
ZapMe went public in October and has a history of losses. But it is growing rapidly. It has installed equipment in 1,300 schools with a total of more than a million students. Under a new policy, Inatome said, schools are free to cancel the ad window -- as long as they are willing to pay between $1,100 and $4,000 a month for Internet access.
