FTC Report Pushes Companies, Congress To Improve Online Privacy

Earlier today, the Federal Trade Commission released the results of its two-year look into what needs to be done about protecting the privacy of American consumers. It all seems to make good sense, but will anyone actually follow the FTC’s recommendations?

The FTC report [PDF] calls for increased online privacy protections and oversight, including a renewed call for a “do not track” tool to tell marketers to stop tracking your Internet browsing.

The commission sets forth a number of recommendations for how companies that handle consumer data can make that information more secure:

Privacy by Design – companies should build in consumers’ privacy protections at every stage in developing their products. These include reasonable security for consumer data, limited collection and retention of such data, and reasonable procedures to promote data accuracy;
Simplified Choice for Businesses and Consumers – companies should give consumers the option to decide what information is shared about them, and with whom. This should include a Do-Not-Track mechanism that would provide a simple, easy way for consumers to control the tracking of their online activities.
Greater Transparency – companies should disclose details about their collection and use of consumers’ information, and provide consumers access to the data collected about them.

“This is a good report that reflects the growing concerns about online privacy among consumers, especially the fact that we need better tools and information to decide how our personal information is used,” explains Ioana Rusu, regulatory counsel for Consumers Union. “When we talk about online privacy, we’re talking about trust. A company needs customers to trust that their personal information is going to be treated with respect. If you don’t trust that a company is going to use your information responsibly, you’re going to be much less likely to adopt new services, and that hurts innovation.”

The report also urges Congress to take up baseline privacy legislation.

“There are a lot of good initiatives in play that could help protect consumers’ privacy, but ideally, we need a law to make sure everyone is playing by the same rules,” says Rusu.

With the market for mobile apps exploding, the FTC says it will host a workshop on May 30 to address how mobile privacy disclosures can be “short, effective, and accessible to consumers on small screens.”

Rusu applauds this move, saying, “We clearly need to spell out the limits on the treasure trove of data that’s being collected by these apps.”