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Buy-in needed for Consumer Privacy Bill of Rights to have any teeth

On the heels of proposed data protection reforms in Europe and the recently unveiled Cybersecurity Act of 2012, President Obama hopped on the bandwagon and last week proposed a Consumer Privacy Bill of Rights to protect personal information online.

Previous online consumer privacy legislation (and many other Internet-related laws, for that matter) have faced much of the same criticism: They either do not do enough to protect online privacy, or when they do it is at the expense of businesses that will spend too much time, money and resources trying to comply with the new rules. The White House promises that its proposal takes into account both sides of the equation by protecting online consumer privacy and economic growth.

The White House’s bill of rights pushes for consumer control over what personal data organizations collect and how they use it; transparency surrounding privacy and security practices; and “reasonable limits” on the personal data that companies collect and retain. In addition, a White House statement accompanying the Consumer Privacy Bill of Rights announcement noted that companies representing the delivery of nearly 90% of online behavioral advertisements — including Google, Yahoo, Microsoft and AOL — have agreed to comply with “Do Not Track” technology.

Buy-in from big names such as these will be essential to any online consumer privacy effort. The New York Times already reported that a mandatory “Do Not Track” mechanism may not stop as much online tracking as some may think. Until hard and fast rules with legal ramifications are implemented surrounding online consumer privacy, it will largely be left up to online businesses to decide how much their customers’ privacy means to them. If consumer privacy concerns are outweighed by the effects on the bottom line? One can only guess which side of the debate they would land.

One other big question surrounding the White House’s Consumer Privacy Bill of Rights proposal is that, well, it’s just a proposal. Congress would have to pass legislation to implement the rules as a law, and this would require time-consuming back and forth to debate the issue. It will be interesting to see what happens if large Internet-based companies realize business will be negatively affected by the new rules and decide to use lobbying influence to fight them. If they do, it’s an easy bet that any new online consumer privacy rules would end up watered down and leave room for more still more targeted rules to be proposed in the future.

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