June 23, 1999
from the Friends-of-the-Revolution dept
28th AmendmentHave you ever submitted personal information to a web-site? Do you use myYahoo? Do you have any idea what information web-sites have, track, and sell about you? The privacy question has been a hot topic ever since Netscape implemented the browser "cookie" and developers started hooking web-sites to databases. Various governments have taken different stances on the subject and the issue is far from being resolved.
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Friends of the Revolution 28th Amendment: The Right to Privacy by Brian Day The Coming Storm ================ Have you ever submitted personal information to a web-site? Do you use myYahoo? Do you have any idea what information web-sites have, track, and sell about you? The privacy question has been a hot topic ever since Netscape implemented the browser "cookie" and developers started hooking web-sites to databases. Various governments have taken different stances on the subject and the issue is far from being resolved. Does it seem strange that a majority of the US based Internet companies are basing their businesses on the acquisition and sale (in direct or indirect manners) of this information? Does this make anyone nervous? What can our government do to help? East vs. West ================== Everyone agrees that people's personal privacy should be respected and protected, but there is a difference in opinion in how to achieve this goal. The two sides of the argument are those who believe that government should stay out of the picture, putting the decision in the hands of the consumer and those that think the government should play an active role. As you might expect, the US is main proponent of the hands-off policy. Ira Magaziner (Clinton's previous Internet advisor) suggested that industry be responsible for creating tools to make it easy for individuals to manage and protect their personal information. On the other hand, the European Union believes that government should create legislation that will protect consumers from misuse of their private information and punish companies that violate these rules. The Domino Effect ================= The US policy has completely failed. Web-sites can do whatever they want with information given to them, and they are free to track and save your every movement. Industry is no closer to developing a software solution than they were 2 years ago (I'm not buying into ECML). Especially since Firefly (the previous leader of the open profiling standard) was gobbled up by Microsoft for a meager $34 Million a year ago. The current champions are a slow moving standards body (W3C) and Microsoft (please!). In Al Gore's recent report on privacy he made it clear that they would give industry one last chance to get their act together. On the contrary, the EU has created many laws including one which disallows companies from sending information across countries borders. (For example: Citibank Europe cannot send customer information to the US for processing.) The EU platform has recently been adopted by Canada, and there are hints of "EU like" legislation starting to pop up in the US at the state level. (California is proposing a law that will not allow grocery stores to keep track of what you buy.) So it appears that we may be on the verge of privacy legislation. Running with scissors? ====================== So if that is the case why are there so many new companies basing their business model on the use of customer information? Yahoo! has customer profiles on 40 Million users and uses that information to deliver customized ads as well as sell targeted products and services. Buy.com sells products below cost and makes up the difference through targeted advertising and understanding consumer's buying habits. A new company called TiVo that has a digital VCR product records your TV watching habits and sends them back to their central database. Are these companies in trouble if legislation passes? Yes and no. Yes - The wild west =================== Most of these web-sites have collected information without the user's consent and without the disclosure of its use. They have inked deals with partners to share customer information and have promised advertisers access to their rich customer base. Their computer systems have been built from scratch on shoestring budgets and jolt cola. If they are required to come clean with their users and/or change some of their business relationships it will require a lot of work that will require a lot of money which they do not have. No - Don't kill the cash cow ============================ Seeing how this is the case it is not likely that the US government will carelessly create laws that will slow down the US high tech machine. Furthermore, I believe that most consumers understand the implicit exchange that is currently occurring (personal information for customized services) and are not likely to stop their current Internet behavior. Finally, most of the information that web-sites are sharing is in aggregate form and advertisers are only able to access consumer information by proxy (anonymously). What to do ========== The danger is that in a global economy where the Internet is the global system, the global rules are currently being set by the EU. If the US government continues to do nothing the rules will be dictated to us. It is clear that Industry is not capable of solving this problem. It cost too much money to develop, and ultimately they have nothing to gain. Here are some ideas: 1. Government Funding - If the government can pay for the development of the B2 bomber and the Alaskan pipeline, perhaps they could pay for the development of open source software that can be used to protect consumer's privacy on-line. 2. A Strong Policy Statement - The government should release a policy statement describing good business practices on the Internet. They are starting to move in this direction, asking all web-sites to post privacy statements describing how they use personal information. 3. Global Consensus - Government should work globally to begin forming global standards of conduct. 4. Cautiously legislate - The government needs to demonstrate the seriousness by cautiously creating laws to protect consumers rights. ================================================================== Friends of the Revolution by Brian Day A column that comes out every so often, and talks about something or another... If you would like to subscribe or unsubscribe, or maybe subscribe more than once let me know via e-mail at bcd2@cornell.edu. Past issues can be found at https://www.techdirt.com/fotr The information contained in this newsletter reflect the opinions of Brian Day, and do not represent actual fact. Any decisions made based on these opinions is your own fault. blah... blah... blah... ==================================================================
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28th Amendment
Business is subject to corrective influence because of media coverage, legislation, tort, consumer avoidance or boycott.
Government is a far larger concern as it is largely indifferent to media coverage, can generally scoff at legislation it doesn't like and is not subject to consumer avoidance as people generally don't have a choice when it comes to government.
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