From: "Jim Harper" <jim.harper () policycounsel com>
To: "Declan McCullagh" <declan () wired com>
Subject: Children's Online Privacy
Date: Mon, 27 Mar 2000 14:27:41 -0500
Declan:
Appropos of the postings the other day about DoubleClick, I thought
politechnicals would be interested in what's below.
Jim
<http://www.techcentralstation.com/NewsDesk.asp?FormMode=PolicyTracksArticles&ID=19>http://www.techcentralstation.com/NewsDesk.asp?FormMode=PolicyTracksArticles&ID=19
Monday, March 27, 2000
The hidden costs of online privacy
By: James W. Harper, Founder and Principal, PolicyCounsel.Com
Earlier this month, Kevin O Connor, the Chairman and CEO of
DoubleClick,
announced that his company was retreating from its plan to
amalgamate
consumers personal information. Up until then, DoubleClick
was taking
dramatic steps to customize the advertising you see online.
This retreat
represented a turning point in the unfolding history of Internet
regulation. The online privacy debate has been joined and,
despite
yawning gaps in the quality of that debate, the press for
federal
regulation will either gain ground or recede from here.
DoubleClick s move came on the heels of a rather large
public relations
blunder. The online advertising industry has not yet made
the case for
using personal information to tailor ads, and there were
allegations that
the DoubleClick plan violated the company s own privacy policy.
Online advertisers are on the defensive and in disarray on
use of
personal information. This is leading some to conclude ---
even those
supposedly lobbying on the industry s behalf --- that
federal online
privacy regulation is inevitable.
This sense of inevitability is appropriate, but for a
different reason than
one might think: we are about to see federal online privacy
regulations
in action. There is no need to guess at what they might do. An
experiment with government privacy standards has already
begun on our
nation s children.
Congress passed the Children s Online Privacy Protection Act
in 1998.
Regulations that take effect April 21st will dictate for the
first time that
a commercial website collecting personal information from
children must
have a privacy link more prominent than other links on the site.
"Personal information" includes e-mail addresses, and just
knowing that
a child s information has been collected brings the site
under the
regulation. As a practical matter, this means that the
regulation affects
all high-traffic sites that collect information from users.
More important than dictating the appearance of every commercial
home page, the regulations require "verifiable parental
consent" before a
website operator may collect information like e-mail
addresses from
children. For the internal use of the website, this means
getting an
e-mail from the parent. For other uses, this means talking
to a parent,
or getting a parent s snail mail, fax, or credit card number.
Estimates of the price tag for serving kids online run as
high as
$100,000 dollars a year. This means that small or new
businesses will
never enter this market or create innovative content for
kids. The
Federal Trade Commission was wildly off-base when it
certified that
these regulations would not significantly impact a
substantial number of
small businesses. Predicting what we give up when we make it
hard to
serve children online is like predicting what species would
have evolved
in an ecosystem that has been lost. If the Internet has
taught us one
thing, though, it is that innovation comes faster and
stronger if small
entrepreneurs participate.
With the price of serving children on the Web going from a
few pennies
each to a few dollars or more, access for some children will
be cut off
entirely. Several companies have announced that they will no
longer
provide free e-mail for kids.
Other companies are undertaking the onerous "verifiable parental
consent" process. This hurdle will trip up many of the
children who might
benefit most from online contact and educational content.
Parents who
are absentee, do not have computer skills, do not speak
English, or do
not have credit cards will be unlikely to allow their
children access to
the online world. The children of highly educated and
credit-worthy
parents will speed through an increasingly diverse and
engaging online
world, while those outside the mainstream will languish in
ignorance.
Once again, the law of unintended consequences will have its
most
devastating effects on the most innocent, our nation s
at-risk children.
The children s privacy regulations provide a small, but
widening window
on what could come from broader regulation. Additional
federal online
privacy regulations are not an inevitability and they should
not be.
There will be debates about online privacy in the coming
months and
years. Hopefully, they will be serious enough to focus on
uses of
personal information that are both harmful and not already
illegal. They
should acknowledge that our society is premised on freedom of
information, and that each individual should have power to
define and
defend his or her own sense of privacy. And these debates should
absolutely include whether current regulations requiring
businesses to
report customers private financial information to the
government should
stand.
Most of all, before the Federal Trade Commission and
Congress institute
a new round of online privacy regulation, they should
examine the last
round, and whether children on the margins should lose
access to our
increasingly online society.
James W. Harper is the founder and principal of
PolicyCounsel.Com.
. . . .
Intro
