The Voice of the eCommerce Industry: A Gift for the Man Who Has Everything

Today, a distinguished US Senator who was once concerned that the Internet had become the “number one national hazard” held a hearing on online privacy. During the hearing, Senator John Rockefeller (WV) added these informed judgments on ad-supported Internet innovation and business models:

On mobile applications that are already subject to laws against unfair or deceptive practices, he said, “these apps are totally unregulated.”

On free websites that collect user interests to drive targeted advertising: “making money off the information” is “cynical” and an “abuse.”

On Facebook’s founder Mark Zuckerberg, “21 year olds have no social values.”

It’s no wonder we’re a bit worried that Senator Rockefeller wants to lead the federal government’s effort to impose new laws on the online world.

Witnesses at the hearing included NetChoice members ACT and Facebook, who both explained industry efforts to protect consumer privacy. ACT announced its Privacy Working Group designed to help apps developers generate privacy policies. Facebook explained how they work with parents and teachers to prevent cyber-bullying, and how Facebook is working with Microsoft to help protect missing and exploited children. In addition, Apple testified that its apps must obtain opt-in consent before using geo-location data.

As this hearing showed, legitimate online businesses strive to meet consumer expectations about privacy because to do otherwise would be very bad for business. Moreover, it could also be against the law to mislead users about privacy of their data.

During the hearing, the FTC’s David Vladeck explained how his bureau of consumer protection uses existing laws to prosecute websites over privacy violations. Vladeck explained how the FTC recently imposed a $3 million civil penalty against an online company for the unlawful collection and disclosure of personal data.

Vladeck closed his remarks with an emphatic plea for “more enforcement resources” to go after those who ignore existing laws-- just as they’ll ignore new laws.

Despite all that, Senator Rockefeller still believes the answer is to pass new laws, such his own Do-Not-Track Online bill introduced last week.

Why such a disconnect between the US Senate and the reality of what’s happening online? It could be that Congressional hearings aren’t the best way to educate lawmakers about how the Internet works for Americans today.

Maybe some Senators don't understand how the Internet gives the information you want, when you want it. Could be they haven't seen how location-based technology adds even more value since this info can be tailored to where you are. But even if our Senators know these things, it's possible they don't understand how and why advertisers are paying for most of the content and services we get for free.

So maybe what we should do is ask for a waiver of Senate gift-giving rules, so we can give Sen. Rockefeller something he really needs — an iPad.

That way the Senator can see for himself how legitimate websites let users decide how location data and interests are shared with advertisers. He might even begin to appreciate how interest data lets advertisers pay for all those free apps and mobile web services that regular Americans have grown to love.