A new kerfuffle behind Microsoft’s anti-Google campaign

February 15, 2013, 3:36 PM UTC

FORTUNE — The main reaction to Microsoft’s “Scroogled” ad campaign against Google has been surprise at the level of negativity. “Fearmongering,” The Verge calls it.

The campaign tells Internet users that they’re being “scroogled” by Google’s practice of “reading” data contained in emails to target ads at them. Of course, nobody at Google actually reads anybody’s email (at least, not as a matter of policy) — it’s all done with software. Ads are directed at users based on keywords found in their email. Several surveys have found that most people don’t know that, and when they hear it, they find it disturbing. Whether that fear is well-founded or not, it’s what Microsoft, somewhat disingenuously (it is advertising after all), is exploiting.

But as part of the campaign, Microsoft (MSFT) is also exploiting the cause-oriented petition site run by Care2. Microsoft has plastered both Facebook (FB) and Twitter with ads directing people to sign a petition there titled “Tell Google to stop going through your email to sell ads.”

As a result, Care2 is now considering changing the terms of its service to prevent companies from using the site for commercial purposes.

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The petition reads in part: “Google earns money by violating your privacy. They go through every word of your personal Gmail so they can target you with ads. Every word of every email. Even the most private ones. Do you feel violated yet?” And it goes on to tout Microsoft’s own email service: “At Outlook, we prioritize your privacy. But even if you don’t use Gmail, Google will still go through emails you send to someone who does in order to sell ads. There is absolutely no way to opt out — whether you’re a Gmail user or not.”

All technically true, although words and phrases like “they” and “go through” conjure images of Google (GOOG) employees reading people’s email. Even if Gmail users know that’s not the case, it still sounds scary.

Microsoft isn’t hiding the fact that it’s behind the petition, but it’s also not playing up its identity. The ads pointing to the petition don’t mention Microsoft or Outlook at all.

“We really scratched our heads over this one,” said Joe Baker, Care2’s vice president of editorial and advocacy. “It was pretty close to the line.” In the end, the site decided that even though the petition is clearly part of an ad campaign, there was “at least a case [Microsoft] could make” that the petition was “advocacy,” Baker said.

Care2 calls itself a “trusted social action network” that is dedicated to helping “make the world a better place” by promoting “good causes” such as “green living, health, human rights, and more.” Microsoft’s rather nasty and entirely self-serving ad campaign seems to fit best in the “and more” category. According to Care2’s terms of service, users are not allowed to “upload, post, email, transmit, or otherwise make available any unsolicited or unauthorized advertising, promotional materials, ‘junk mail,’ ‘spam,’ ‘chain letters,’ ‘pyramid schemes,’ or any other form of solicitation, except in those areas (such as shopping rooms) that are designated for such purposes.”

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“We’ve really never seen anything like this before,” Baker said. While companies sometimes launch petitions on the site that clearly help them promote themselves, those petitions usually are less obviously mercenary than Microsoft’s and have until now always actually promoted some social cause, as when a health-oriented firm posted a petition having to do with stroke prevention. In the wake of the Scroogled petition, “we’re thinking about whether we should change our terms,” Baker said.

Microsoft in July hired Mark Penn, a top Democratic political operative, to help with marketing strategy. He is widely believed to be behind the Scroogled campaign.

Microsoft has not responded to a request for comment.Update: A Microsoft spokesman says the company emailed a response to a request for comment on Thursday, but for some unknown reason, that email was never received. Late Friday, the spokesman forwarded this statement from Stefan Weitz, senior director of online services: “Privacy of email services is a fair subject for a petition, and 6,000 people have said so in just a few days. Over 500,000 people have visited our website and tens of thousands have tried Outlook.com. It is a serious public policy issue a lot of people care about.” The company’s goal is to reach 25,000 signatures.