FTC pushes for ‘Do Not Track,’ draws comparison to ‘Big Brother’

The Federal Trade Commission, stepping confidently into the murky waters of online privacy and personal data mining, has released an amended series of best practices and recommendations for government and technology leaders alike.

The new report, “Protecting Consumer Privacy in an Era of Rapid Change,” builds on the framework established in a 2010 report, addressing concerns that have arisen from the public and private sectors over the practices outlined and language previously used.

“The final framework is intended to articulate best practices for companies that collect and use consumer data,” not to serve as the structure for future regulations or enforcement, the FTC assures in the report, though it already has a prominent detractor.

FTC Commissioner Thomas Rosch, in a public statement released alongside the report, was quick to voice his dissent with the proposed reforms, which were approved by a vote of 3-1.

“It would install ‘Big Brother’ as the watchdog over these practices not only in the online world but in the offline world,” Rosch warns. “That is not only paternalistic, but it goes well beyond what the Commission said in the early 1980s that it would do, and well beyond what Congress has permitted the commission to do.”

Key to the commission’s changes to its earlier report, the document amends a previous recommendation for companies to follow a list of five categories of acceptable collection without prompting consumer choice. Now the decision to allow consumers choices is dependent on “the context of the consumer’s interaction with the business.”

The scope of the changes has also been altered to lessen the burden on small businesses, and does not apply to companies collecting non-sensitive data from fewer than 5,000 consumers each year, unless said data are also distributed to third parties.

The report also calls for legislation addressing concerns over the breadth of data being compiled about consumers, and the general lack of control and knowledge individuals have over the information stored and used by companies. Particularly, the FTC highlights an insufficient degree of transparency by those collecting personal information for profit.

“Although some companies have excellent privacy and data security practices, industry as a whole must do better,” the report says.

For implementing the new recommendations, the FTC is putting its focus on five main points. “Do Not Track,” the proposed ability by consumers to opt out of tracking procedures, has the support of the Digital Advertising Alliance and the World Wide Web Consortium, but the FTC wants the implementation to go further. The opt-out system, similar to the “do not call” registry, would have to tread a fine line between amending privacy concerns while ensuring that valuable data are not unjustly removed from technology sectors dependent on consumer information.

The FTC is also putting its weight behind “short, meaningful disclosures” for mobile customers seeking more knowledge about the information being obtained from them. This goes hand in hand with its desire for self-regulatory codes to be established for each individual technology sector.

An interesting point in those regulatory codes is the inclusion of unfair and deceptive practices, an element that Rosch pays particular attention to.

“‘Unfairness’ is an elastic and elusive concept. What is ‘unfair’ is in the eye of the beholder,” he says in his dissent. “For example, most consumer advocacy groups consider behavioral tracking to be unfair, whether or not the information being tracked is personally identifiable and regardless of the circumstances under which an entity does the tracking.”

In what may be the most contested of the five action items, the FTC wants Congress to move forward with calls to allow consumers to access the information held about them by data brokers, and for the industry itself to establish a centralized resource through which the brokers will divulge their practices and provide greater context as to how they manage the consumer data.

Beyond congressional action, the FTC also admits that it will need the support of so-called “large platform providers,” the Googles, Facebooks and Comcasts of the tech world, in expanding public awareness of privacy issues and the industry’s adoption of more transparent standards.

But if Rosch’s early concerns over its recommendations are any indication, the FTC may need to work a bit harder to persuade the major players in the technology industry to join in with its regulatory proposals.

morgan.little@latimes.com

Original source: FTC pushes for ‘Do Not Track,’ draws comparison to ‘Big Brother’