For proof that privacy is issue No. 1 with Internet users, look
no further than last month's goof by America Online.
The country's largest online service had quietly altered its
user terms of service - the rules subscribers agree to abide by
when they sign up - so that it could rent out members' telephone
numbers to telemarketing partners such as membership buying club
CUC International Inc. and TeleSave Holdings Inc., a discount phone
The new telemarketing scheme, which wasn't publicly announced,
was to take effect July 31. But when reporters and AOL subscribers
found out, it instantly made headlines. After widespread protests
by customers and electronic-rights advocates - and a one-day, 2.6
percent dip in the company's stock price - AOL Chairman Steve Case
capitulated and canceled the policy. But AOL may still make
telemarketing calls for its partners, the company said.
The incident points out how seriously Internet users take their
Selling lists of consumer names, addresses and phone numbers is
the norm in the direct-marketing industry. But the Internet is held
to a different standard, according to Christine Varney, outgoing
Federal Trade Commission commissioner.
On the Internet, where companies such as America Online can
track a person's online behavior and match it with other
demographic data, using that information "is so much more an
invasion of privacy," said Varney, speaking at an electronic
privacy gathering in San Francisco held the same day that AOL
canceled its telemarketing plan.
That's not to say the government should step in and regulate
what information companies can gather online, said Varney, who will
leave her post in September to practice Internet law.
"Government solutions are burdensome and oftentimes an
invasion," she said. "We need the government to act as a floor.
When it comes to children, we should have laws regarding collection
of information without a parent's consent."
But regulating junk "spam" mail and other commercial uses of
the Internet could chill innovation and challenge freedom of
speech, Varney said.
Instead, Varney and other free-market advocates support the use
of technology to solve the privacy problem.
One solution: using software to block "cookies," Web-site
technology that tracks a visitor's password, shopping purchases and
other data and stores it on the person's computer hard drive for
future reference. Cookie filtering programs include Pretty Good
Privacy's Cookie Cutter ( http://www.pgp.com), Barefoot
Productions' CookieMaster 2.0, available from ZDNet's Hotfiles
shareware library (http://www.hotfiles.com), and The Limited
Software's Cookie Crusher, also available from Hotfiles. …