Privacy 2010

Update on the FTC Roundtables Update on the FTC Roundtables Update on the FTC Roundtables Update on the FTC Roundtables Update on the FTC Roundtables Update on the FTC Roundtables Update on the FTC Roundtables Update on the FTC Roundtables

and Congressional and Congressional and Congressional and Congressional and Congressional and Congressional and Congressional and Congressional ActionActionActionActionActionActionActionActionand Congressional and Congressional and Congressional and Congressional and Congressional and Congressional and Congressional and Congressional ActionActionActionActionActionActionActionAction

March 18, 2010March 18, 2010March 18, 2010March 18, 2010March 18, 2010March 18, 2010March 18, 2010March 18, 2010

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The Past is Prologue

1999-20001999-2000

1999♦ FTC Conference on Online Profiling♦ OECD Consumer Protection Guidelines♦ Network Advertising Initiative

2000♦ FTC Report to Congress

1999-20001999-2000

19991999 20002000 20012001 20022002 20042004 20062006 20072007 20082008 20092009 20102010

A Call for RegulationA Call for Regulation

• Commends NAI but . . . but . . .

• [Recommends] legislation that would set forth a basic level of privacy protection for all visitors to consumer-oriented commercial Web sites with respect to profiling.respect to profiling.

–– Basic standards of practice governing the collection and use of information Basic standards of practice governing the collection and use of information online for profiling, and provide an implementing agency with the authority to online for profiling, and provide an implementing agency with the authority to promulgate more detailed standardspromulgate more detailed standards

–– [Including] authority to grant safe harbors to self[Including] authority to grant safe harbors to self--regulatory principles which regulatory principles which effectively implement the standards of fair information practices articulated in effectively implement the standards of fair information practices articulated in the legislation and subsequent rulemaking. the legislation and subsequent rulemaking.

2001-20052001-2005

2001♦ FTC Conference on Consumer Data♦ NAI adopts opt-out cookie♦ New Chairman Muris – legislation “premature”

2002♦ “Dewey the Turtle”

2001-20052001-2005

20002000 20012001 20022002 20032003 20042004 20052005 20062006 20072007 20082008 20092009

Behavioral Targeting

PAGE TWO

34!34!34!34!SEATTLE’S SOGGY SODSSEATTLE’S SOGGY SODSSEATTLE’S SOGGY SODSSEATTLE’S SOGGY SODS

CITY BREAKS RECORD FOR

Seattle Beacon Seattle Beacon Seattle Beacon Seattle Beacon March 18, 2010March 18, 2010March 18, 2010March 18, 2010


CONSECUTIVE RAINY DAYS

SEATTLE. Forget Spain, the rain falls mainly in Seattle as the Emerald City “enjoyed” its 34th consecutive day of rain breaking the 1953 record. Sonny Smith, President of the Visitors and Convention Bureau was quick to point out that even with the record, the city still gets far less total rain than cities such as Miami. In fact, Seattle is not even among the top 101 cities for total rainfall. So remember, it could be worse – you could be in Miami.

We got plenty

in Palm Springs

www.sunsunsun.com

PAGE TWO

34!34!34!34!SEATTLE’S SOGGY SODSSEATTLE’S SOGGY SODSSEATTLE’S SOGGY SODSSEATTLE’S SOGGY SODS


Seattle Beacon Seattle Beacon Seattle Beacon Seattle Beacon March 18, 2010March 18, 2010March 18, 2010March 18, 2010

12TH Annual

Chainsaw Juggling

Convention


CONSECUTIVE RAINY DAYS

SEATTLE. Forget Spain, the rain falls mainly in Seattle as the Emerald City “enjoyed” its 34th consecutive day of rain breaking the 1953 record. Sonny Smith, President of the Visitors and Convention Bureau was quick to point out that even with the record, the city still gets far less total rain than cities such as Miami. In fact, Seattle is not even among the top 101 cities for total rainfall. So remember, it could be worse – you could be in Miami.

FRIDAY MARCH 19THFRIDAY MARCH 19THFRIDAY MARCH 19THFRIDAY MARCH 19TH

KING COUNTY HOSPITAL & KING COUNTY HOSPITAL & KING COUNTY HOSPITAL & KING COUNTY HOSPITAL &

CONVENTION CENTERCONVENTION CENTERCONVENTION CENTERCONVENTION CENTER

25

30

35

40

45$44.0

By the Numbers

Increased Click-through rates

670% to 1000%

Increased Conversions

0

5

10

15

20

25

20052008

20102012

10.7 14.2 16.8

$0.2

$7.8

$17.0

Pct of Display Ads US Ad Spending ($100MM)

Increased Conversions

400 to 900%

BUTBUTBUTBUT . . . 66% of consumers do not want websites they visit “to show you ads that are tailored to your interests

Renewed Focus on BT

2006-20072006-2007

2006♦ CDD Files FTC Complaint Attacking BT

2007

♦ Merger Mania♦ ehavioral Advertising Workshop♦ CDD “Do Not Track” Proposal♦ FTC Proposes BT Self-Regulatory Guidelines♦ Facebook’s Beacon Program

20062006 20072007 20072007 20072007 20072007 20072007 20072007 20082008 20092009 20102010

♦ Facebook’s Beacon Program

20082008

2008♦ Industry Pushback on Self Regulatory Principles♦ NAI Updates Principles♦ NebuAd and BT 2.0 Blow up on Capitol Hill♦ FTC Workshop on Mobile Marketplace

20082008 20082008 20082008 20082008 20082008 20082008 20082008 20082008 20082008 20092009

20092009

JAN-AUG 2009

♦ FTC Releases Revised BT Guidelines♦ Leibowitz Repeated Warnings to Industry♦ House hearings, explore BT♦ IAB, DMA, AAAA Release BT Guidelines

JANJAN FEBFEB MARMAR JUNEJUNE JULYJULY SEPTSEPT NOVNOV DECDEC DECDEC DECDEC

FTC’s Revised Proposed Self-Regulatory Guidelines (2009)

� Every website where data is collected for behavioral advertising should provide a clear, concise, consumer-friendly, and prominent statement that

� data about consumers’ activities online is being collected at the site for use in providing advertising about products and services tailored to individual consumers’ interests, and

� consumers can choose whether or not to have their information collected for such purpose.

� consumers can choose whether or not to have their information collected for such purpose.

� Reasonable Security, and Limited Data Retention, for Consumer Data

� Affirmative Express Consent for Material Changes to Existing Privacy

� Affirmative Express Consent to (or Prohibition Against) Using Sensitive Data for Behavioral Advertising

20092009

SEPT - DEC 2009♦ FTC Announces Roundtable♦ Privacy Wars♦ Facebook Revised Privacy Policy♦ FTC Panel on Newspaper Industry♦ FTC/OECD Conf. on 10th Anniv. Of Guidelines♦ First FTC Roundtable

JANJAN FEBFEB MARMAR JUNEJUNE JULYJULY SEPTSEPT NOVNOV DECDEC DECDEC DECDEC

Industry Self Regulatory Principles

� Education

� Transparency

� Consumer Control

Data Security� Data Security

�Material Changes

� Sensitive Data

� Accountability

Round One

December 7th, 2009December 7 , 2009Washington, D.C.

FTC Chairman LeibowitzFTC Chairman Leibowitz

•• We're at another watershed moment in privacy, We're at another watershed moment in privacy, •• We're at another watershed moment in privacy, We're at another watershed moment in privacy, and the time is right for the commission ... to take and the time is right for the commission ... to take a broader look at privacy . . . Our minds are a broader look at privacy . . . Our minds are open.open.

•• We all agree that consumers don't read privacy We all agree that consumers don't read privacy policies, or EULAs for that matter. I've been a policies, or EULAs for that matter. I've been a supporter of optsupporter of opt--in for quite some timein for quite some time..

I believe action has not been a high I believe action has not been a high enough priority to date. [The] United enough priority to date. [The] United States needs comprehensive privacy States needs comprehensive privacy legislation. If we continue the piecemeal legislation. If we continue the piecemeal approach to privacy in this country, we approach to privacy in this country, we merely push aside the underlying issues. merely push aside the underlying issues.

FTC Commissioner Commissioner Jones-Harbour

merely push aside the underlying issues. merely push aside the underlying issues.

Industry attempts to provide notice and Industry attempts to provide notice and choice to consumers have been choice to consumers have been insufficient thus far. insufficient thus far.

We have strayed far from the Fair We have strayed far from the Fair Information Practices that should serve as Information Practices that should serve as a baseline for any comprehensive privacy a baseline for any comprehensive privacy legislation. legislation.

Shift in Focus – Use not Collection

` We are taking a look at a number of technologies and business practices—including social networks, cloud computing, mobile, cloud computing, mobile, data broker relationships, and behavioral advertising—and will assess both the benefits and risks of those practices.

Christopher OlsenAsst. Director - Division of Privacy and Identity Protection

20092009

2010♦ Edith Ramirez and Julie Brill Confirmed♦ Google Buzz and Facebook Investigations♦ Netflix Settlement♦ Second and Third Roundtable♦ Waiting for Godot Stearns

20092009 20102010 20102010 20102010 20102010 20102010 20102010 20102010 20102010 20102010

Round Two

January 28, 2010January 28, 2010UC Berkeley School of LawBerkeley, California

Vladek Warns of Enforcement Actions

� Consumers don’t understand commercial information-collection practices (ex: data brokers, behavioral targeting).

Lengthy policies are not effective; � Lengthy policies are not effective; and

� FTC is preparing to launch enforcement actions against companies engaged in “practices that undermine the tools that consumers can use to opt out of behavioral advertising.”

David Vladek

Director, Bureau of Consumer Protection

Round Three

March 17, 2010March 17, 2010Washington, D.C.

“Irresponsible Practices”

Commissioner JonesCommissioner JonesCommissioner JonesCommissioner Jones----HarbourHarbourHarbourHarbour

� Google’s Buzz and Facebook Privacy Policy change “irresponsible”.

� Concerned that “technology companies are learning harmful lessons from each other’s attempts to push the privacy envelope. continue to launch products where their guiding privacy principle appears to be, ‘Throw it products where their guiding privacy principle appears to be, ‘Throw it against the wall, see if it sticks – and if not, we can always pull it back.’ Deeds speak louder than words, and this is turning into a dangerous game of ‘copycat’ behavior. And unlike a lot of tech products, consumer privacy cannot be run in beta.”

� Calls for FTC to adopt position of intolerance towards such behavior.

� SSL security should be default standard in cloud computing.

What’s Next?

FTC not certain where it will go and plans to "sit back" and think about the detailed record before making public a set of

“I have a sense, and it’s still

amorphous, that we might head

toward opt-in.”

David Vladek Chairman Leibowitz

before making public a set of detailed recommendations by June or July.

CONGRESS

???

New Commissioner Julie Brill

� Senior Deputy Attorney General and Chief of Consumer Protection and Antitrust for the North Carolina Department of Justice

� Co-chair of the National Association of Attorneys General Privacy Working Group and Fair Credit

� Assistant Attorney General – Vermont

Congressional Limbo

� March 13, 2009: Privacy bill a top priority

� May 6, 2009: Working on draft privacy bill.

� October 1, 2009: “Privacy legislation � October 1, 2009: “Privacy legislation affecting the online advertising industry could be submitted by November . . . [a]ccording to statements made recently by Rep. Rick Boucher.”

� January 28, 2010: Boucher "very close" to finishing a discussion draft of the legislation.

Rep. Rick Boucher (D-Va)Chairman House Energy and Commerce Committee’sSubcommittee on Technology and the Internet.

Internet Law Center100 Wilshire Blvd., Suite 950Santa Monica, CA 90401

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Santa Monica, CA 90401www.internetlawcenter.net

Bennet Kelley(310) [email protected]

♦ Consumer Data Ecosphere Slides

About the Internet Law Center

Appendix

♦ About the Internet Law Center

♦ About Bennet Kelley

Consumer Data Ecosphere

The Internet Law Center is dedicated to helping businesses navigate the evolving legal standards for today’s digital economy, while also contributing to the development of the policies of tomorrow. The firm serves a diverse client base that includes startups and public companies both online and offline across North America and Asia.

The professionals of the Internet Law Center possess years of

About the Internet Law Center

The professionals of the Internet Law Center possess years of practical experience as lawyers and entrepreneurs with internet companies and have played a leading role in shaping Internet law and policy. This unprecedented combination of business, legal and policy experience makes the Internet Law Center uniquely qualified to provide the professional advice needed to address emerging issues of internet law in an uncertain economy.

Sign up for the Cyber Report – our award winning newsletter which was named one of the Top 100 Internet Law Resources. It is also available on our blog (along with other materials).

Bennet is one of the nation’s leading Internet attorneys and founder of the Internet Law Center. He is Co-Chair of the California Bar Cyberspace Committee and a frequent speaker on the latest developments in Internet law at conferences throughout North America. Bennet also is a regular guest on Webmaster Radio’s “InBoxed”.

About Bennet Kelley

Bennet has played a leading role in shaping Internet law and policy having testified and lobbied on Internet issues in Washington and Sacramento, winning praise from a key Congressional committee for his contributions to federal spyware legislation.

In addition, the Internet Law Center’s bi-weekly newsletter, Cyber Report, was named one of the top 100 Internet law resources and recognized by the LA Press Club.