FTC endorses "do not track" legislation

December 2, 2010

Changes may be in the works in laws covering the collection or use of data that can be connected to website visitors, whether it is a specific person or simply tied to a device such as computer, or mobile phone. Yesterday, Federal Trade Commission staff issued a press release outlining the commission’s recommendations for overhauling how businesses handle online privacy issues.

“This proposal is intended to inform policymakers, including Congress, as they develop solutions, policies, and potential laws governing privacy, and guide and motivate industry as it develops more robust and effective best practices and self-regulatory guidelines,” according to the report, which is titled, “Protecting Consumer Privacy in an Era of Rapid Change: A Proposed Framework for Businesses and Policymakers.”

Until now, industry has practiced various forms of self-regulation, which the Commission finds a burden for the average website consumer. Just as the FTC addressed the problem of phone solicitations, the Commission hopes to provide an easy method for consumers to opt-out of online tracking, if they so desire.

“Technological and business ingenuity have spawned a whole new online culture and vocabulary — email, IMs, apps and blogs — that consumers have come to expect and enjoy. The FTC wants to help ensure that the growing, changing, thriving information marketplace is built on a framework that promotes privacy, transparency, business innovation and consumer choice. We believe that’s what most Americans want as well,” said FTC Chairman Jon Leibowitz.

The Commission recommend a simple mechanism to allow consumers a way to set a “persistent setting, similar to a cookie, on the consumer’s browser signaling the consumer’s choices about being tracked and receiving targeted ads.” Such a method, if added as functionality to web browser applications, would allow website visitors to essentially “broadcast” their desire to not be tracked to any website they visit, rather than requiring website operators to maintain lists of consumers.

According to a New York Times report, F.T.C. Backs Plan to Honor Privacy of Online Users:

“The recommendations, which were contained in a 79-page report, were cautiously received by browser makers including Google, Mozilla and Microsoft, who said they would examine the report and provide feedback to the commission.”

While the FTC lacks the authority to enact regulations of this nature, the new Your Times further reported that the House Subcommittee on Commerce, Trade and Consumer Protection will hold hearings later this week to review the feasibility of various options for opting out of online tracking.

While the central focus of the issue seems to be around services that track user activity across multiple websites, and then sell the data, this will certainly be a topic to watch in the coming months for all website owners and managers.