Tech trade group questions FTC privacy settlements

A technology industry trade group that counts Google, eBay and Microsoft among its members questioned the length of recent privacy settlements reached by the Federal Trade Commission with firms accused of violating consumers' privacy.

The Computer & Communications Industry Association issued a statement Wednesday in response to the settlement between Facebook and the FTC that requires the social network to implement a comprehensive privacy program and submit to 20 years of outside privacy audits. A similar settlement between Google and the FTC earlier this year covers the same time frame.

“Regardless of the merits of this latest settlement, we have some concern that the 20 year oversight provisions seem to be becoming the norm. This may be unnecessarily long when dealing with dynamic companies that have competitive reasons to be responsive to the privacy demands of their customers," said CCIA president Ed Black. 

The settlements bar both firms from misrepresenting their privacy practices. Facebook cannot change its privacy settings to make user data public without first obtaining users' consent. Every violation can subject the company to a fine of $16,000 per violation per day.

The drumbeat for consumer privacy legislation on the Hill has grown louder over the past year, particularly in the Senate, where several bills have been introduced. The FTC also has pressured browser manufacturers to come up with a way for consumers to avoid being tracked or face new regulations.

The settlement was roundly praised by lawmakers after the announcement, but some said it was further evidence of the need for more clarity in the law. CCIA argued that if new regulations are needed they should be developed with public input.

“Today’s announcement by the Federal Trade Commission is a step forward in giving American consumers a greater say in how their data and personal information is shared. But in many ways, this settlement clearly demonstrates that the privacy debate in Washington remains unresolved," said Rep. Mary Bono Mack (R-Calif.) in a statement.

"Most importantly, privacy policies should be transparent and understandable to everyone, and consumers should have an easy-to-understand way to opt out of sharing information, if they choose to do so. Today, there are still a lot of unanswered questions."

"If more extensive regulation of the Internet privacy world is the intent, we would hope to get there through a transparent process rather than a series of potentially ever expanding consent decrees," Black said.

"CCIA recognizes that finding the right balance that protects privacy while allowing innovation to flourish in rapidly evolving industries will likely remain an ongoing challenge for years."

---