Yahoo's new ad system causes privacy concerns

There are concerns that the interest-matching advertising technology Yahoo! Japan is adding to its free mail service in August will violate the privacy of its users because it displays ads based on analysis of their e-mails.

Yahoo said the new technology will not cause privacy infringements because consent from users of the free e-mail service--said to total 15 million people in Japan alone--will be sought.

However, the ad technology will read e-mails that have been sent to Yahoo members by people who do not use the free mail service.

The Internal Affairs and Communications Ministry said it will question Yahoo to determine whether the technology would violate the Telecommunications Business Law, which guarantees the privacy of communications.

In the new ad system, the contents of sent and received e-mails that are stored on Yahoo's server will be read and analyzed.

Yahoo said the pages used by its members will then feature advertisements that match their interests.

For instance, if a user receives an e-mail from a friend who suggests going to a hot spring, Yahoo's Web pages may display advertisements on their sidebars for a hot spring, travel agency or other related businesses.

Yahoo announced its plan at the end of May to launch the ad service. However, some Internet users are voicing concern about whether it could violate the confidentiality of communications.

Regarding letters, the Penal Code and the Postal Law prohibit postal service administrators from opening and reading them. Likewise, the Telecommunications Business Law stipulates that privacy of communications must not be breached.

Under the law, communication administrators may be jailed for up to three years or fined up to 2 million yen (S$32, 180) if they actively learn of or disclose the contents of e-mails.

Yahoo says its ad service will not breach the privacy of its members because the e-mails will be automatically processed electronically, and will not be read by people.

However, the communications ministry said that electronic processing and human analysis are usually considered the same thing.

The new ad system is also under criticism because not only does it read e-mails written by Yahoo members, but also the e-mails they receive from nonmembers.

The Internet company stressed e-mails will not be read without the member's consent.

As it is permissible to scan e-mails to block spam, reading mail from nonmembers after only obtaining the consent of Yahoo members will not cause any privacy problems, Yahoo said.

But, Hisamichi Okamura, a lawyer specializing in privacy issues, said this practice could violate the communications law since the agreement of both parties is usually necessary for a third party to read personal communication.

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