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Protecting Online Privacy
EDITORIAL
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Protecting Online Privacy

EDITORIAL

New York Times

December 5, 2010

The Federal Trade Commission has come up with timely recommendations to protect privacy online.

For years, data trackers have collected information about people's activities as they surf the Web, packaging it into profiles to sell to advertisers. The practice itself is not what is at issue, but rather the way it is done. Many trackers don't disclose it. Others put complex, pro forma disclosures in obscure places on Web sites. Few consumers read them. Most don't understand how much information they are sharing about their online lives.

Internet companies and advertisers insist that industry self-regulation is enough to protect consumers. But companies' many lapses — one site that allowed parents to monitor their children online, for example, sold information about the kids' activities to marketers — suggest it is time for regulators to set minimum standards that every company must follow.

The F.T.C. sets three recommendations to improve the protection of consumer privacy, starting with more transparency, including standard, simple and clear privacy disclosures to let people know who is doing what with the data about their online activities.

It recommends that companies include privacy protection in their operational goals. And most important, the F.T.C. insists that consumers be given a clear, simple option to opt out of online data tracking altogether — along the lines of the do-not-call registry — perhaps through a “do not track” button on Web browsers.

 

Advertisers argue that allowing surfers to opt out of tracking en masse would hobble the ad revenues that support most Web sites. This argument is overblown.

Giving Americans the choice to opt out of data tracking does not mean everybody will. Moreover, even if regulation limits advertisers' ability to precisely target their ads according to consumers' tastes, they will still need to advertise. They will just do it differently. Advertising spending in the United States amounted to 1.8 percent of G.D.P. last year. In 1990, before Yahoo even existed, it amounted to 2.2 percent of G.D.P. It has remained within that range over nearly two decades.

The F.T.C.'s report, which it calls preliminary, is only a first step toward better privacy protection. It is calling for public comment over the next two months, after which it will issue definitive recommendations. Yet while the commission has said it will police privacy abuses more aggressively, its proposal for a “do not track” button will probably require an act of Congress.

Fortunately, privacy protection has bipartisan support. So this is a great opportunity for Congress to prove that it can pass some meaningful legislation.