A lawsuit brought against Priceline, Travelocity and Cingular by the New York State Attorney General's Office has been settled, and marks the first time that law enforcement has held advertisers responsible for ads displayed through adware. Direct Revenue, a company that uses known adware programs to plant ads on consumer's machines, delivered the adware advertisements on behalf the three major companies.

Priceline, Travelocity and Cingular agreed to pay fines ranging from $30,000 to $35,000 to pay New York for penalties and investigatory costs. Though the companies agreed to pay the fines, they did not admit guilt in the case. The settlement marks a new beginning for guidelines that will now hold advertisers accountable for the way their ads end up on a consumer's computer.

Advertisers had previously been able to shy away from liablity by ignoring how their advertisements were delivered, including ads displayed via adware. Last year, Direct Revenue was investigated and it was found that Priceline, Travelocity, Cingular, Monster.com, JPMorgan Chase, United Airlines, and many others spent hundreds of thousands of dollars to display ads through the Direct Revenue software. The Direct Revenue system installed adware onto computers and delivered advertisements. It also monitored Internet activity and collected data from the machine it was installed on, all without adequate consent from the user.

Priceline, Travelocity and Cingular have agreed to be more cautious about their online advertising practices as a condition of the settlement. Cingular spokesman Mark Siegal said that the company no longer uses adware, claiming that Cingular stopped using Direct Revenue about a year and a half ago. Siegal stated that they did not agree with Direct Revenue's opt-out policy, saying that it did not give consumers enough control over the program. Travelocity said that it had terminated the use of Direct Revenue last year and is now in compliance with the new guidelines. Priceline had already adopted better practices by the time the New York investigators contacted the company and had stopped using adware. A representative of Priceline said that the company fully supports the Attorney General's position on adware and has not used an adware program since last year.

The agreement between the companies and the Attorney General ensures that any company delivering ads online will adhere to the following guidelines:

• Disclose the name of any adware program or bundled software.

• Each ad must contain a prominent brand name or icon.

• Describe the adware and obtain a users consent before the program will downlaod and run.

• Make any adware used must be easily removable.

• Obtain consent to continue displaying ads to users who have used the adware on their system.

• Any affiliate must also be made to meet these requirements.

Hopefully this lawsuit will help deter companies from using secret adware programs as a means to bring in revenue. With any emerging technology, rules and guidelines must often be agreed upon after the fact, and this ruling builds upon a series of guidelines that is long overdue.