Thursday, March 19, 2009

OnlineSpin: Privacy Protection Is Now A Centrist Issue

Last week Dave wrote "The Pace Of Technology Innovation Is Accelerating."

Patrick O'Heffernan wrote in response, "This is a surprise?

One of my first classes for my doctorate at MIT was on the pace of knowledge and how it accelerates in a constant feedback loop.

The Internet has been a major accelerator, moving the pace of innovation orders of magnitude faster.

There are pros and cons to this, probably discussed at the conference: It is a constant murmur at TED."

Thursday, March 19, 2009
Privacy Protection Is Now A Centrist Issue
By Dave Morgan

The issue of protecting online consumer privacy is about to get a lot more attention in Washington, D.C. While I've written about this subject a number of times in the past, it has never been with the immediacy that I write about it today. Privacy is about to take center stage with our federal legislators and regulators -- an occurrence I, and many others, don't think we're ready for.

The issue has been with the online ad industry for years. We had the public concern and regulatory backlash after the DoubleClick/Abacus merger. We have had organizations like the Network Advertising Initiative, TRUSTe, and more recently the Interactive Advertising Bureau working to develop self-regulatory programs to help the industry manage privacy. Many of us have been called to testify on privacy issues before the Federal Trade Commission and Congress.

In the past, most of the advocates calling for tougher privacy laws represented relatively extreme views. They were privacy advocates representing organizations that no one -- even those inside the beltway -- had heard of. No more.

Events during the past three weeks have changed the outlook for privacy legislation that could impact our industry.

First, FTC member Jon Leibowitz was named by President Obama to be the commission's new chairman. Not only is he a passionate consumer advocate, but he has stated many times he believes the online industry is giving short shrift to protecting consumer privacy. He does not believe that online ad companies do a good job of telling the public what user information they capture and what they do with this info. He is right.

Second, Representative Rick Boucher, the new chairman of the House Subcommittee on Consumer Protection, announced that he will be introducing legislation to regulate online privacy. While he recognizes that the FTC recently released an advisory report calling for continued self-regulation, he is on record that he doesn't believe most online ad companies are complying with the FTC's advice. He is right.

Leibowitz and Boucher are no Luddites. Nor are they fringe privacy zealots. They are both among the most tech-savvy in Washington and are quite centrist and pragmatic, certainly relative to those normally calling for more regulation or legislation in this area. No longer is the fight against governmental privacy protection a fight against the fringe. It is now a fight against the middle.

What should we do? Now is the time for online ad companies to get truly serious about self-regulation. The industry may not be able to avoid legislation in this area, but it can work to insure that the impact of any legislation is minor.

There is no question that many of our companies are vulnerable in this area. A number of companies try to be good actors, but don't pay enough attention to protecting privacy to realize that they are doing a bad job giving appropriate notice and choice to their users concerning data capture on their sites. We also have a number of companies out there that are just plain bad actors, who hide behind those that are ignorant. And, finally, we have a number of folks out there with a mindset that just because we can offer "better" services by capturing user data, and just because many younger users don't seem to worry too much about privacy, we don't have a problem.

We do have a problem. It is about to move beyond our control. Will you help fix it?

Dave Morgan is the CEO of Simulmedia. Previously, he founded and ran both TACODA and Real Media.

Online Spin for Thursday, March 19, 2009:

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