When Pudding Media unveiled its new free VoIP service at the DemoFall 2007 last week the reaction was fast, furious, and not particularly flattering.

Free Speech ain't free...and apparently, now it's really creepy- CK's Blog

All free, at the modest price of your privacy Kristine Lowe's blog

Most loathesome business model: Pudding Media listens in on your calls, delivers ads Pajama Entrepreneur

Pudding Media: Sounds delicious, smells fishy- Dani Sevilla at Marketing Conversation

Pudding Media eavesdrops on internet calls, displays relevant ads- engadget

Today's Terrible Idea: Pudding Media  Silicon Alley Insider

There is a different perspective: Pudding Media is really cool technology and takes one -on-one marketing to places relationship marketeers could only dream of 10 years ago.

From Pudding Media's website:

It's Saturday night. You plan to go to a movie with Ashley. But which movie should you see...? Time to call her and decide. You surf to ThePudding.com and call Ashley for free. As soon as you start talking about movies, a list of local movies, complete with reviews and show times appear on the screen. Now, what about dinner? Just talking about where to get dinner, and offers for local restaurants are displayed.

Talk about not having to lift a finger. The software does the heavy lifting. It has an " I Dream of Jeannie" quality to it. Your wish is the software's command.

tgdaily has a video demonstrating how these ads would populate your computer screen during a conversation using pudding media.Some people are going to look at the demonstration and mourn the passing of our rights of privacy.

Others will look at the demonstration and say, "Beam Me Up Scotty!"

Pudding Media's terrible idea is not that far afield from Gmail's "terrible" idea where every time you look at an email in your gmail account the right side bar is filled with text ads that are related to the content of your message. 

When Gmail first launched there were those that raised the privacy concerns.  Back in 2004, Arik Hesseldahl, writing about Gmail in Forbes minimized those fears.

E-mail is an inherently insecure medium. For the most part messages are sent in the clear, meaning almost no attempt is made to obfuscate the contents of a message from someone with prying eyes. All Internet service providers store e-mail on a server in order to deliver it to you. Technicians with time on their hands and lousy ethics can--if they want--read your mail.

Louise Story covered the Pudding Media launch for The New York Times

“We saw that when people are speaking on the phone, typically they were doing something else,” said Ariel Maislos, chief executive of Pudding Media. “They had a lot of other action, either doodling or surfing or something else like that. So we said, ‘Let’s use that’ and actually present them with things that are relevant to the conversation while it’s happening.”

The company’s model, of course, raises questions about the line between target advertising and violation of privacy. Consumer-brand companies are increasingly trying to use data about people to deliver different ads to them based on their demographics and behavior online.

Pudding Media executives said that scanning the words used in phone calls was not substantially different from what Google does with e-mail.

Bloggers are not so sure.

From CK's blog,

According to the company's CEO "Pudding Media had considered the privacy question carefully. The company is not keeping recordings or logs of the content of any phone calls, he said, so advertisements only relate to current calls, not past ones, and will only arrive during the call itself.

So you bother me DURING my call? When I'm actually trying to have the conversation?

The CEO also thinks that young people, the group his company is focusing on with the call service, "are less concerned with maintaining privacy than older people are."

Whether or not young people want privacy isn't the issue--an arrogant assumption, btw--the issue is that you're a grown-up preying upon them in the name of "targeted advertising."

And that's really creepy.

I've said it oh so many times before, but here goes once more: Marketers, just focus on creating, innovating and maintaining exemplary products, services and experiences. You'll be amazed how your markets will gladly give you their time, money and loyalty without your needing to waste precious ad dollars stalking them.

They might even call you.

Esme Vos, The Pajama Entrepreneur, says there is a difference between software picking up words in your email and software picking up words in a phone conversation.

There’s something very intimate about phone calls and I would be completely freaked out if strangers, even if it were a software bot, were listening in on mine. Of course Pudding’s founders don’t think so, having been in the military intelligence business. Does it help them to have the former chief privacy officer of Microsoft on their advisory board? It depends on whether you think Microsoft is a friend or foe of privacy.

Esme goes on to say that the technology may be either very good or very bad for the sex chat industry.

I can see where it would be quite popular: in the sex chat industry. The caller dials a number via Pudding’s web-based service, sees ads on the side while he or she is chatting — although I think this destroys the pay-per-chat business model of sex chat businesses unless they offer this free version to their customers in exchange for seeing ads on a web browser (and the ads actually make up the lose in revenue).

If my memory serves me correctly (and it doesn't always these days) many many people were creeped out by Google's business model for Gmail which offers "free services in exchange for ads."

That didn't stop millions for signing up and becoming gmail evangelists. It hasn't stopped advertisers signing up to have their ads placed in the right column of my gmail message.

Familiarity breeds acceptance.

Is Pudding Media any greater breach of our privacy than gmail? I don't think so. It's a different breach, but its not a greater breach.
Pudding Media makes us uncomforable because it's another in a long list of in your face reminders of what so many of us have given up so willy nilly to take advantage of emerging technology.

We bank online and while we may hesitate when asked to fill in our social security number online,we do it.

We fill out online health insurance forms asking the most personal of personal health issues .While we  may hesitate,ultimately we decide that filling it out on line is a lot more convenient than  having to mail the information in.

That's why Pudding Media doesn't feel like such a severe drop down that slippery slope.  When it comes to compromising our privacy,we've been sliding for so long that we know there's no way to regain the type of privacy we once had.Pandora's box on this issue was opened a long time ago.

Even if we opted to mail in that form with our social security number we know that it will go into a database that is vulnerable to hackers.

Of all the invasions to our privacy, is Pudding Media that horrific? Not to me. However,if I am in the minority opinion on this and the majority of consumers are creeped out by this new software ,the advertisers will do what they always do when consumers reject a product or person ( Think Don Imus). They will treat it like the plague instead of the second coming.

Elana blogs at

FunnyBusiness-Everything About Business Except the Bottom Line.