Academic journal article Communications of the IIMA

Online Privacy Policy of the Thirty Dow Jones Corporations: Compliance with FTC Fair Information Practice Principles and Readability Assessment

Academic journal article Communications of the IIMA

Online Privacy Policy of the Thirty Dow Jones Corporations: Compliance with FTC Fair Information Practice Principles and Readability Assessment

Article excerpt


Privacy policy in corporation's business refers to a statement or a legal document that discloses some or all of the ways a party gathers, uses, discloses, and manages a customer or client's personal data such as name, age, address, gender, email, etc. ("Privacy Policy," 2012). While online privacy policy (or online privacy) emphasizes on the right or mandates of personal privacy concerning the storing, repurposing, providing to third-parties, and displaying of information pertaining to oneself via the Internet ("Internet Privacy," 2012). In the age of the internet, sharing information, communication, and working through the internet, especially the flow of information between companies and customers has caused a growing concerns regarding online privacy policy. For example, Google, as one of the most popular search engine in the world, has a well-known reputation and vast of cooperation with third parties. However, an announcement from Maryland Attorney General Douglas Gansler and attorneys general from thirty-five other states indicated that Google had tracked people using computers and mobile devices based on its new privacy components (published on March first, 2012) such as searching history without opt-out choice for customers (Acohido, 2012).

From customer's view a disclosed online privacy would satisfy customer's concerns letting her/him know what information the company collected, what information the company may share with third parties, and how the company may secure her/his information. As mentioned above, the new online privacy of Google revealed the information that Google has been tracking customer's information. Few customers would like to be monitored all the time by Google; however, customers would be like walking on the thin ice without notice if there was no online privacy. In 1998, the United States Federal Trade Commission (FTC) reported a study of online privacy concerns to Congress. In this report, FTC described a widely-accepted Fair Information Practice Principles (FIPs) of Notice, Choice, Access, and Security1 (Landesberg et al., 1998). And FTC also defined the Enforcement principle to provide sanctions for noncompliance as a critical component of any governmental or self-regulatory program to protect online privacy.


In July 1997, FTC conducted a survey about consumer privacy on the World Wide Web. The survey includes six sample groups: 1) comprehensive, 2) health, 3) retail, 4) financial, 5) children, and 6) most popular. Only fourteen percent of all sites in the Comprehensive Sample (sample size = 674) posted any disclosure about privacy. Only seventy-one percent of all sites in Most Popular Sample (sample size = 111) have some type of information disclosure about privacy (Landesberg et al., 1998). Furthermore, a study by George Milne, Mary Culnan, and Henry Greene showed that online privacy has grown in length as well as declined in readability (Milne et al., 2006). Even though a company discloses its online privacy and complies with FIPs, the unreadable privacy is still impractical for customers. Few people would like to spend half an hour or even a couple of hours to read the online privacy notice, especially when she/he is shopping online. Therefore, FIPs compliance and improving readability seems to be more and more intensive in terms of current online privacy policy.

Significance of the Project

On March 30th 2012, Nicole Perlroth from the New York Times reported that approximately one million to three million Visa and MasterCard accounts were exposed at Global Payments. Credit card numbers as well as cardholders' personal information had been hacked when payments were processed. Nicole also mentioned this was the second breach already at Global Payments in the last twelve months. Additionally, Heartland Payment Systems disclosed a breach which caused 130 million credit card to be hacked during two years from 2007 to 2009 (Greenberg & Schwartz, 2012). …

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