ONLINE TRACKING: Time running out on self-regulation

Privacy groups and some members of Congress are up in arms, andrightfully so, over a study revealing that many online advertisingcompanies continue to follow people's Web activity, even after usersbelieve they have opted out of tracking.

Consumers have legitimate worries about the information that'sbeing collected and used online. It's time for the Internet industryto come to a collective agreement about the privacy protections itwill guarantee.

If innovators do not find a way to police online tracking,Congress will feel compelled to regulate the industry. Washingtondoes not have a good track record when it comes to imposing rules ontechnology; too often it has either slowed innovation or donesignificant damage to tech firms' bottom line. But there is littleconfidence the industry will do the right thing, either.

One of the leading proponents of a "Do Not Track" law is Rep.Jackie Speier, a Hillsborough Democrat who calls the notion ofindustry self-regulation "a joke." And the executive director of theCenter for Digital Democracy, Jeff Chester, told the San JoseMercury News that self-regulation "is deliberately designed to notbe effective. It's designed to give the appearance of protectingprivacy, while actually enabling data collection to proceed fullforce."

To battle that perception, which was buoyed by the recent report,consumer advocates and Internet companies must agree quickly onwhat, if any, data collection remains permissible even after aconsumer opts out of tracking. The agreement should clearly barcompanies from selling information about users to third parties.Both sides must acknowledge that consumers should be able to haltads that are targeted based on the sites they surf and theirdemographic. And consumers should have some recourse when theserules are broken.

It's less clear whether Web firms should be prevented fromcollecting data to prove to advertisers their ads have beendelivered. Internet companies need the capacity to performreasonable business functions that don't intrude on consumerprivacy.

The ultimate goal should be a one-click option for consumers thatprotects their privacy without the need to install complex softwareor read the fine print of a wordy disclosure statement.

Consumers know that Internet companies legitimately earn vastamounts of revenue from advertising and data collection. Many don'tmind sharing their information if it means they can continue to viewwebsites for free, and they may prefer seeing ads targeted to theirspecific interests. This kind of agreement won't kill the industry.

The Do Not Call registry, enacted in 2005, shows that Congresscan act when consumers' privacy is in jeopardy. The Internetindustry must move quickly to assure lawmakers and the public thatit is capable of responding to these legitimate consumer concerns.