David Vladeck, Director of the FTC’s Division of Consumer Protection, this morning previewed the long-awaited FTC report that sums up months of discussion regarding the future of privacy regulation in the United States and examines the viability of a Do Not Track mechanism. Vladeck indicated at the Consumer Watchdog Policy Conference that the existing privacy framework in the U.S. is not keeping pace with new technologies. In addition, he stated that the pace of industry self-regulation, while constructive, has been too slow. According to Vladeck, the report will address several major themes, including the following:

  • There is a need to reduce the burden on consumers to allow them to control their information more effectively. Vladeck provided several examples of ways to reduce this burden:
    • Privacy by Design, which entails building privacy protections into products and services at the outset and practicing good data hygiene from the start. Vladeck noted that the more companies do on the front end, the less burden there will be on consumers on the back end.
    • Greatly simplify consumer choice, which involves streamlining choice mechanisms so consumers can focus on choices that really matter to them, such as uses of data they would not expect. Choice should be presented in a short and concise manner at the point of collection.
    • More consistent privacy policies that would allow consumers to compare companies’ privacy practices at a glance.
  • Strong protections are needed for sensitive information, which includes health, financial, children’s and geolocation data.
  • Once consumers exercise choice, it must be respected. Vladeck indicated that the FTC would not tolerate a “technological arms race aimed at subverting” consumer choice.
  • Privacy policies are here to stay. But to help promote accountability, we need better privacy policies and must reduce the current dependency on the notice and choice framework.
  • Data brokers will continue to be in the spotlight. The FTC views access to data maintained by data brokers as “a key ingredient” of accountability.
  • Consumer and business education is a critical issue. There is a need to broaden and deepen consumers’ understanding of organizations’ information practices so consumers can take steps necessary to protect their privacy.  

Recognizing that consumers want control over their data, the FTC report explores a Do Not Track mechanism where marketers would need to respect consumer choice. While acknowledging that there have been some industry efforts along these lines, Vladeck believes the options are too disparate. He stressed the need to simplify consumer choice. The FTC believes that a Do Not Track mechanism would help to achieve this goal.

Vladeck indicated that the report will mark the end of Phase One of the FTC’s “privacy rethink” project, and lays out a basic framework for moving forward. The FTC is seeking comments, which are due January 31, 2011. We will provide continuing coverage throughout the day regarding the FTC’s report, which is scheduled to be issued at 11 a.m. EST.