Embattled NebuAd Sees Its CEO Step Down

(MoneyWatch)  Stick a fork in NebuAd -- it's done. Chief executive Bob Dykes, who has led the behavoiral tracking firm since 2007, announced his intention to step down from his post today, yet another bit of bad news for a company that's had more than its fair share of it lately.

NebuAd has been struggling under Congressional scrutiny for its use of ISP-provided info to track consumers, and Dykes was the pointman during the hearings. PC Magazine had this exchange from the hearings, which took place in July:

[C]hairman Edward Markey, a Massachusetts Democrat, pushed Dykes to issue his support for a system that would allow Internet users to opt-in to online tracking rather than opt-out.

"You have to get the consumer to say yes," Markey told Dykes at the time. "Do you support that?"

"I think you're forcing me into one of those 'have you stopped beating your wife?' questions," Dykes responded.

"Have you stopped beating the consumer?" Markey asked.

Dykes is taking a new position at VeriFone, but will remain on the board of directors at NebuAd.

Numerous outlets are also reporting that NebuAd has put its plan to track consumers via ISP on hold, as many business partners tare now backing away from the company like its on fire. Which it may as well be -- last month NebuAd was also forced to lay off employees. Unless some very serious things change, both at NebuAd and within the marketplace as a whole, I think the company may be on its last legs.

How much of this is deserved? NebuAd, to my mind, is serving as as something of test balloon for behavoiral trackers, and it getting a bit unfairly maligned. Its plan to use the data from ISP to track consumers at the individual level certainly is shady if done without permission (and that's what the majority of the objections have been raised about), but if consumers are willing and firms like NebuAd have their explicit consent, then why not? I've yet to see anyone raising a stink about Nielsen families.

That said, it's obvious the type of deep-packet inspection NebuAd was attempting to implement is dead in the water at this point. NebuAd's last, best hope is to rapidly pivot towards providing behavoiral metrics that are seen as kosher. Unfortunately for NebuAd, it's a crowded playing field already, and the company is coming into the game with a couple of strikes already.