Unlike another privacy bill draft circulating recently, a bill introduced yesterday received some positive reviews from both sides of the privacy issue.
The online privacy bill introduced yesterday is a step in the right direction, according to both online ad industry players and privacy advocates. While a similar bill draft from Virginia Rep. Rick Boucher floated in May was largely met with negativity from both sides, the bill sponsored by Rep. Bobby Rush of Illinois is seen by industry and consumer privacy wonks as a starting framework from which to craft legislation that balances consumer protection and rights with industry goals.
Still, both sides are troubled by aspects of the bill, which will be discussed Thursday during a House hearing.
At first pass, Mike Zaneis, Interactive Advertising Bureau's Public Policy VP, saw the bill as a step in the right direction. In particular, he said a safe harbor provision in the Rush bill for companies participating in an industry self-regulatory program - such as one the IAB and a coalition of advertising trade groups are developing - is "a huge concession to the industry's work towards building an [online behavioral advertising] self regulatory program."
Rush's bill is "much more palatable than the Boucher proposal," said Zaneis. The bill establishes the Federal Trade Commission as the agency responsible for setting processes for implementation and compliance with provisions. Rush's H.R. 5777 "advances the discussion," said Jeff Chester, executive director of the Center for Digital Democracy. The CDD is part of a coalition of privacy and consumer rights groups lobbying to strengthen consumer protections in the bill. "The key conclusion about the Boucher bill was that it wasn't clear that the Federal Trade Commission would have clarity around rulemaking authority," he said, suggesting the Rush bill does provide more clarity.
Chester indicated that privacy advocates are pleased with stipulations that give states and individuals the ability to take civil action against companies that collect, store, and use consumer data that they believe are in violation of requirements to provide opt-out consent for collection and use of personal information. However details of that provision, removing liability for some companies, may not be considered adequate by consumer protection advocates. The bill gives safe harbor from private legal action to companies in compliance with the would-be self-regulatory program.
The bill calls for the program - subject to FTC approval - to require companies collecting and using consumer data to provide a "clear and conspicuous opt-out mechanism" prohibiting said companies from disclosing personal data to third parties. The bill also suggests that industry self-regulation could provide a tool for consumers to manage preferences, including "online behavioral advertising preferences."
It also requires establishment of procedures for compliance assessment of companies in the program, as well as establishment of consequences for failure to comply. Those might include public notice of noncompliance, suspension or expulsion from the program, or referral to the FTC for enforcement, states the bill.
The FTC would be required to set up guidelines and processes for the program no later than 18 months after enactment of the law. The bill also calls on the FTC to conduct a consumer education campaign to notify people of their related rights.
Chester called the fact the bill gives the FTC control over setting parameters a good thing. "We recognize there's a role for safe harbor," Chester said, adding, "We also believe in and support a role for online advertising." One concern among privacy advocates lies in the amount of leeway government gives the digital ad industry. Overall, suggested Chester, the bill should help reduce the amount of user data collected and give consumers more control over that collection and data usage.
Although additional progress on the bill could be made during a House subcommitee hearing scheduled for Thursday, it is likely that not much more will be done before Congress breaks for recess between August 9 and September 12. Even if the bill does eventually become law, it would not take effect for two years after its enactment.
Join the Industry's Leading eCommerce & Direct Marketing Experts in Chicago
ClickZ Live Chicago (Nov 3-6) will deliver over 50 sessions across 4 days and 10 individual tracks, including Data-Driven Marketing, Social, Mobile, Display, Search and Email. Check out the full agenda and register by Friday, Oct 3 to take advantage of Early Bird Rates!
Kate Kaye was Managing Editor at ClickZ News until October 2012. As a daily reporter and editor for the original news source, she covered beats including digital political campaigns and government regulation of the online ad industry. Kate is the author of Campaign '08: A Turning Point for Digital Media, the only book focused on the paid digital media efforts of the 2008 presidential campaigns. Kate created ClickZ's Politics & Advocacy section, and is the primary contributor to the one-of-a-kind section. She began reporting on the interactive ad industry in 1999 and has spoken at several events and in interviews for television, radio, print, and digital media outlets. You can follow Kate on Twitter at @LowbrowKate.
IBM Social Analytics: The Science Behind Social Media Marketing
80% of internet users say they prefer to connect with brands via Facebook. 65% of social media users say they use it to learn more about brands, products and services. Learn about how to find more about customers' attitudes, preferences and buying habits from what they say on social media channels.
An Introduction to Marketing Attribution: Selecting the Right Model for Search, Display & Social Advertising
If you're considering implementing a marketing attribution model to measure and optimize your programs, this paper is a great introduction. It also includes real-life tips from marketers who have successfully implemented attribution in their organizations.
September 23, 2014
September 30, 2014
1:00pm ET/10:00am PT
October 23, 2014
1:00pm ET/10:00am PT