Gator.com, a US-based software company, has filed a lawsuit seeking a declaration as to the legality of its pop-up advertisement software.

Pop-up advertisements have been around for a while and, for regular surfers, they can be a real annoyance. Gator.com, however, seeks to stand out from the crowd by only delivering pop-up ads as and when users want them.

The software application in question is Companion Popup Banner which comes bundled as part of the Gator form filling software, distributed for free from the Gator.com website. For end users, the main attraction of Gator is that it recognises and then completes online forms and log-in user names and passwords. An additional, subsidiary feature of the software is that when a user is on a site for a particular class of goods, such as toys, Gator will automatically deliver price comparisons and pop-up advertisements for similar products.

When launching Companion Popup Banner on 23 August, Gator.com described the application as a "controversial program". Hardly surprising then that it drew flack from the Interactive Advertising Bureau - a trade organisation made up of various media companies - which accused Gator.com of unfair business practices and of infringing the trade marks, copyrights and other intellectual property rights of Web publishers and advertisers.

These claims were based on the IAB's complaint that the Companion Popup Banner "obscures advertising and/or editorial content on Web sites through the use of specially designed pop-up windows and without the consent of Web sites or innocent third party advertisers". The IAB mentioned a possible referral to federal authorities which prompted a swift and forceful response from Gator.com through the filing of legal proceedings against the IAB.

So, is there any merit in the IAB's claims that the Companion Popup Banner application is illegal? In Hong Kong, it is unlikely that a court would have much time for any claims that the appearance of a pop-up advertisement over a website would in itself infringe the website operator's intellectual property rights. Any such claim would have to rely on an argument that users would be confused into believing that Gator.com's pop-up advertisements are somehow authorised by the operator of the particular website where the pop-up advertisement appears.

It is difficult to see how such an argument would succeed in Hong Kong given that all users of Gator software are informed of and agree to accept pop-up advertisements supplied by Gator.com at the time they sign up for the Gator package.

Other possible grounds for complaint against Gator.com could be based on privacy issues surrounding so-called "browser companions" such as Gator. In the case of Gator, the user downloads the application onto his or her desktop. The Gator icon then appears every time you go on to the Internet and it notifies Gator.com when you enter a site where its services (such as form filling, price comparisons or pop-up ads) might be required. Although Gator.com claims not to track users' every move or to keep data on individual users, privacy activists would argue that the information which it collects already goes to far.

However, as was demonstrated earlier this year when claims against DoubleClick for, amongst other things, invasion of privacy were dismissed, privacy activists are fighting a losing battle. In the case of DoubleClick, users' surfing habits are tracked through the use of cookies placed on users' computers, generally without their knowledge. With Gator.com, however, users formally accept its terms and conditions which expressly permit Gator.com and its partners to collect information on where users surf and shop. In such circumstances, a court is unlikely to have any sympathy with a user who then complains that his movements are being tracked.

So, it looks as if the Gator.com business model is here to stay. As the saying goes, there's no such thing as a free lunch. As reality takes over on the Internet, there are less and less free lunches to be had. In Gator.com's case, you may get their software for free, but there's still a trade going on - when you accept their software, you accept their customers' advertisements as well.

An edited version of this article was first published in South China Morning Post on 8 September 2001