Wednesday, December 8, 2010

In a recent Wall Street Journal article, law makers are discussing the need for an Internet Privacy Act.  The focus of the proposal is to prevent the collection of data about internet usage.  The data collected is supplied to third parties for the purposes of advertising.  Sometimes the data is sold sometimes it is just shared among related parties.  In almost all cases the data is collected without the knowledge of the computer user.

The FTC Commissioner  Jon Leibowitz, has stated that the “Self regulation of privacy has not worked adequately and is not working adequately for the American consumer.”  At this point the FTC is not calling for legislation, however, if the industry does not step up to fix the problem, the FTC believes that a legislative solution will be needed.

The newly elected Senator from Connecticut, Richard Blumenthal, who is currently the State’s Attorney General, has already gone on record as calling for a “Do Not Track” list, similar in nature to the “Do Not Call” list for telephone marketers.  This would put the burden on the consumer to tell the “industry” that they do not want their information collected.

The major web browser makers including, Google, Microsoft and Apple have all tried some form of a blocking system in the past or are currently trying to put one in place.  The FTC has described these as a blunt instrument, which does not fix or control the problem.  The focus has been put on the browser developers and on the private users.

What about the companies that collect and track the data?  Where do the advertisers fit into the equation?  As could be expected the data collection companies and the advertising industry are against any form of limiting data collection.  A company already exists that allows consumers to “Opt Out” of receiving targeted ads.  Their position is that if all data collection stops or is greatly curtailed, then the companies that provide “free content” based on the fact that advertisers will reach their target audience directly will not continue.  This seems like a reasonable outcome. 

It seems to me that we are headed for another system like cable TV or Satellite Radio, where some content is free and some content is paid for.   If privacy is your overriding concern then you may have to pay an extra fee to have all your information blocked.  If getting free information is more important to you then you will put up with the ads and data collection.  As we have seen from several recent scandals that involve public figures, once you put something on the web it’s here forever.  Almost anyone can find it and almost anyone can use it.  So do we get to decide or is the government going to decide for us. 

One thing I think we can all agree upon is that the collection of data on minors without parental consent should be prohibited and the penalties should be sizable.  Fining a giant corporation several thousand dollars for failure to follow the law is simply a nuisance and not a deterrent.  The statements and the policies must be clear and easily understood by an average person.  It can be quite a problem to have a pre-teen or a teenager complaining about not using a site because the adult, often quite educated, cannot understand the privacy policy.  Educational and informational sites that schools are recommending for students to use should also be protected.

We can all see that as soon as you start to regulate the system the question now shifts from “should we regulate?” to “how much do we regulate?”  This begins to show the problems associated with the issue at hand.  It appears that the FTC may have the right idea.  Let the industry with some government oversight develop its own methods for controlling the problem.  Give the consumer the options to control who can track their date and how much data they can track.  Build the blocking options into the browser from the start.  Then let the advertisers choose the way that the content will be provided.  The market will always dictate to the businesses how it wants its information.  The current opt out system prevents the collection of data for advertising not the collection of tracking data altogether.  The main flaw in the system as I see it is that I do not know who is tracking my data and for what purpose.  Big Brother are you watching?

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