This is the second, and final, post in a series on the FTC’s recent report “Protecting Consumer Privacy in an Era of Rapid Change” and their proposal of a “do not track” function to block the collection of certain consumer information online.

The FTC is a regulatory organization, so it’s unsurprising that their instincts would point them towards restriction. The proposed “do not track” option, which is a bit more nuanced than their “do not call” initiative, is a proposal that makes sense from a consumer standpoint. In an ideal world, all Internet and mobile users would be up to snuff on the issues discussed in the aforementioned report. In an even more ideal world, companies doing business online would take those questions into consideration and ensure that consumers don’t have to worry about the data they share – knowingly or unknowingly.

In this world, consumers probably aren’t going to take the time to actually dig into questions of privacy other than to sound the alarm if they feel their privacy has been violated. In the same world, as has been the case, companies are not willing to meet consumers all the way.

As Stephanie Miller writes in the ClickZ article “FTC Recommends More Government Regulation for Marketers,” and as many others have written, questions of privacy go far beyond safeguarding personal information and blocking unwarranted (sometimes intrusive) prods into an individual’s daily life. Browsing histories and the information we input online inform our entire experience, from the search results and paid advertising we receive to the delivery of even more useful, personalized information.

Could businesses have done more to safeguard consumer information, ensuring that tracking did not extend beyond bounds?

Yes.

Is it too late for the online business community to grab for the reins?

Maybe not, however, if the recent Gawker password leak did anything (other than put personal information from hundreds of thousands of people up for grabs online) it showed the fragility of our information systems.

In this case, doing better business would have directly benefited both Gawker and their community.

Even faced with all of this, the notion of a “do not track” button is scary for a few reasons. For one, it’s an extremely simple solution to a complex problem. It doesn’t account for all of the nuances associated with questions of consumer tracking.

The FTC would likely say that this is where informed consumers come in, but they’ve already noted that these same consumers are unlikely going to read through large amounts of explanatory content – especially when a simple, easy-to-understand option, like “do not track” is presented.

So where can we do better?

A little adversity almost never hurts anyone and, in most cases, forces creative and conscious shifts towards a better end. For businesses that do a brisk trade online, the threat of being cut off (or severely restricted) may force a move towards more consumer-conscious information collection. Like most good things, there may be a little bit of regulation thrown in to kick-start the process. Hopefully, like the best things, we won’t have to rely solely on forced adherence.

The FTC is open to suggestions, comments and concerns. If you’re serious about affecting the outcome of this issue, then get involved by commenting on the proposed legislation.

ClickZ is also offering itself up as a median for discussion. (See: Anna Maria Virzi’s “Do-Not-Track: What’s Your Call to Action?”) If you’re concerned about the effect of a “do not track” initiative, then affect it. Now is your chance.

It’s a computer fantasy
it is waiting for you and me.
Living – living on video
Trans X – “Living on Video” (1984)

On Tuesday, Newsweek pegged “the end of privacy” as one of the worst trends of 2010. One of the biggest complaints was that nearly everything we do online is tracked and, in some cases, that information is traded or sold to companies without our permission. The sort of information gathered online, mostly behind the scenes, ranged from prescription histories to reading preferences.

Newsweek isn’t the only party disgruntled by the state of activity tracking and information sharing on the Internet. Earlier this month, the Federal Trade Commission (FTC) released the massive report “Protecting Consumer Privacy in an Era of Rapid Change.” Part of that report is a proposal for “do not track” functionality on Web browsers, giving Internet users the ability to cut off the activity tracking that many companies use to develop online marketing plans and deliver customized content.

The privacy question isn’t a new concern for the FTC and, honestly, we shouldn’t be that surprised it’s coming up. Neither is it an issue which the advertising industry has completely ignored. In early October, the Interactive Advertising Board (IAB) announced the launch of a self-regulatory program endorsed by heavy hitters like the Better Business Bureau and the American Advertising Federation.

If you’re interested, you can read the IAB’s response to the FTC report and the proposal of a “do not track” list.

Even with efforts by companies and groups like the IAB, self regulation has been a bit of a mixed bag. The FTC has long advocated a “privacy by design” approach, asking companies to be upfront about what information they’re collecting, how they’re using it and taking the appropriate steps to safeguard that data.

They’ve also asked businesses to be transparent, giving consumers clear explanations and, when appropriate, the choice to opt out of information collection. While some companies have taken this charge seriously, others have continued to play ball on a considerably broader field.

However, and the FTC acknowledges this, the collection of consumer information can lead to many positive user experience upgrades. In our next blog post, we’ll discuss some of the potential downsides to the FTC’s plans for “do not track” implementation and limited consumer tracking.