It’s no surprise that the issue of online privacy rights has been the topic of discussion in recent months, following the announcement of two new bills regulating the collection of data online. On April 12th, 2011, Senators McCain and Kerry introduced the long-awaited Commercial Privacy Bill of Rights, which covers the control of retention, collection, and use of online data. By May 9th, Senator John Rockefeller introduced the Do-Not-Track Online Act of 2011 (pdf).

Following a review of an interview with Director of the FTC’s Bureau of Consumer Protection, David Vladeck, interesting points were raised during their discussion of Congress’ latest privacy bills, social networks, and the online advertising and marketing industry.
When asked about the FTC’s current stance in the newly imposed privacy bills, Vladeck addresses the support FTC has in legislation, but points out that the efforts of these bills anticipate a long process that the FTC has yet to take a formal position in.

It’s important to understand that the FTC pursues companies that violate their own privacy terms, and are therefore held liable for their deception. The FTC has built their framework on this foundation, but also brings to light unfairness and half-truth deception cases. Vladeck also mentions the importance of civil penalties on data breaches and stresses that data security is the FTC’s legislative agenda on privacy.

So, what does this mean for online advertising and marketing efforts? Where is the line drawn between fair marketing behavior and what kind of marketing behavior invades privacy? It will be interesting to observe the result of privacy protections and how it affects online marketing and customer relationship management, not to mention social networks.
There is speculation that industry professionals may face detrimental effects on their CRM systems, used to learn about the behavior and buying patterns of clientele. However it seems that this issue may not be as much of a problem as some may think. There is a strong level of support among those in the industry and many believe that privacy and data collection is already adequately regulated.

The industry has definitely began to move forward with these initiatives, and only time will tell whether self-regulatory and tracking innovations are moving in the right direction.

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