Protecting online privacy

Federal legislation: Industry group, consumer coalition press for enforceable Internet standards.

January 29, 2001

WITH THE HIGH-TECH industry and consumer groups both demanding federal regulations for online computer privacy, chances of enacting protective legislation have greatly improved.

Previous congressional attempts to protect privacy of Internet users foundered on industry opposition and White House preference for self-regulation. There's also an overlying concern about the unintended consequences of laws trying to define a rapidly evolving electronic world.

While President Bush has no clear record on the issue, Congress seems prepared to bridge past differences over numerous competing bills and seriously address Internet privacy legislation.

Pollsters identified privacy as a major issue in the last presidential campaign. E-commerce analysts estimate a yearly loss of $16 billion in sales because of users' fears about security and privacy.

The American Electronics Association this month asked for federal law to govern how businesses use personal data collected over the Internet. The nation's largest high-tech trade group said it favors uniform privacy standards to preempt a patchwork of state laws. A coalition of consumer groups, including the American Library Association, also urged federal action to prevent misuse of data collected by Internet Web sites.

Any effective federal law must balance protection of a user's personal information with ease of electronic commerce. But responsible law must include conspicuous notice of privacy policies, consumer choice on use of personal data, access to correct erroneous information and security of data.

A key issue is how consumers agree to the use of information collected. Industry favors the "opt-out" method, where consumers are presumed to agree unless they seek out and click the "no" option. Much better is the "opt-in" method, where Web sites must get a consumer's OK before doing anything with this personal data.

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