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TELECOM Digest     Sat, 12 Mar 2005 22:53:00 EST    Volume 24 : Issue 110

Inside This Issue:                             Editor: Patrick A. Townson

             Special Report on Privacy
    A Decade of Disappointment - Part I (Patrick Townson)

[TELECOM Digest Editor's Note: I went to that web site and read
entirely the essay mentioned (A Decade of Disappointment) and found
it well worth the time to reprint here for inclusion in our archives.
But it is _quite large_ so it will appear in two parts; much of it
will appear in this issue, the balance in the next issue.  PAT]


From: Patrick Townson <>
Subject: A Decade of Disappointment - Part I
Date: Sat, 12 Mar 2005 15:43:22 -0600

  Privacy Self Regulation: A Decade of Disappointment
  By Chris Jay Hoofnagle
  March 4, 2005

  A hi-resolution version report is available in PDF (2.5 MB).

  [Front Cover: Lists of personal information for sale from website

  [Inside Front Cover: Letter forwarded to EPIC explaining that an
   individual has no rights in personal information held by the company,]


  The Federal Trade Commission (FTC) is capable of creating reasonable
and effective privacy protections for American consumers. There is no
better example of this than the Telemarketing Do-Not-Call Registry.
The Registry, which was created and is now run by the FTC, makes it
easy for individuals to opt-out of unwanted telemarketing.  Now, more
than 80 million numbers now no longer ring at the dinner hour.

  Prior to the creation of the Registry, the telemarketing industry
created self-regulatory protections that were largely useless.  One
had to write a letter to opt out of telemarketing, or pay to opt out
by giving their credit card number to the Direct Marketing Association
(DMA). The industry's self-regulatory efforts didn't even cover all
telemarketers-only those that were members of the DMA.  At its peak,
the self-regulatory opt-out system had less then 5 million

  FTC's success in the telemarketing field demonstrates that it can
protect Americans' privacy effectively and fairly. However,
telemarketing was a 20th century problem.  This report argues that it
is time for the agency to move into the 21st century.  It is time for
the agency to apply the principles of telemarketing privacy regulation
into the online world.

  The FTC can protect privacy better than the industry can with
self-regulation. We now have ten years of experience with privacy
self-regulation online, and the evidence points to a sustained failure
of business to provide reasonable privacy protections.

  New tracking technologies exist that individuals are unaware of, and
old tracking technologies continue to be employed. Some companies
deliberately obfuscate their practices so that consumers remain in the
dark.  Spyware has developed and flourished under
self-regulation. Emerging technologies represent serious threats to
privacy and are not addressed by self-regulation or law.

  Self regulation has failed to produce easy to use anonymous payment

  And finally, the worst identification and tracking policies from the
online world are finding their way into the offline world. In other
words, the lack of protection for privacy online not only has resulted
in a more invasive web environment, but has also started to drag down
the practices of ordinary, offline retailers.

  EPIC calls upon the Federal Trade Commission and Congress to
seriously reconsider its faith in self-regulatory privacy approaches.
They have led to a decade of disappointment; one where Congress has
been stalled and the public anesthetized, as privacy practices
steadily worsened.  We call on the government to create a floor of
standards for protection of personal information based on Fair
Information Practices.

  I. The FTC Registry Is Better Than Market Alternatives

  The Federal Trade Commission's (FTC) Telemarketing Do-Not-Call
Registry was a stunning privacy success.  Americans enrolled 10
million numbers in the Registry in its first day of operation.  Now,
the phone has stopped ringing on the more than 60 million numbers that
were enrolled by the public.  The nuisance of telemarketing will now
be a thing of the past.  Those who wish to receive telemarketing may
still do so, but others have an easy option to preserve the dinner
hour from interruption.

  When one analyzes the decisions made by the FTC, it reveals that the
agency took steps to effect consumers' desires.  The FTC publicized
the existence of the Registry and gave it a simple name and URL on the
Internet.  The FTC allowed people to enroll free by telephone or by
the Internet.  The FTC minimized "authentication" burdens.  That is,
the FTC made it easy for people to enroll by not requiring the
consumer to jump through unnecessary hoops. Some from the industry
suggested that only the line subscriber-not even a spouse or
roommate-could enroll.

  The Do-Not-Call Registry was a success because the FTC took the
opposite approach from the self-regulatory system created by the
Direct Marketing Association (DMA).  In every respect, the FTC ensured
that the Registry would be easy to use and fair, while the DMA's
opt-out mechanism was difficult to use and relatively unknown.

  For starters, the DMA's system only applied to the industry
association's members.  Telemarketers who had not joined the group
were not bound to comply with consumers' desire to opt-out.  The FTC's
approach applied to a much broader group of telemarketers.

  Second, the DMA's list was named the "Telephone Preference Service."
The name and acronym, "TPS," had no meaning to the public.  To some,
it could mean a list of people who preferred to be telemarketed.  The
FTC approach, on the other hand, was sensibly named and assigned a
easy to remember URL,, on the Internet.

  Third, the DMA's list required the consumer to actually write a
letter for free enrollment.  To enroll online, the consumer had to pay
a fee and give their credit card number to the DMA.  The FTC's
approach allows free Internet, mail, and telephone enrollment.

        The FTC's Registry is universal, free, and easy to
use. Individuals could enroll online or by phone.  The DMA's only
applied to its members, cost money to enroll online, and was difficult
to find. It's no wonder why the DMA's list only had 5 million
enrollments, while the FTC's has more than 80 million.

  These forces combined to make the DMA's market approach to
telemarketing ineffective.  The numbers speak for themselves.  USA
Today commented in 2002 that: "In 17 years, just 4.8 million consumers
have signed up with the DMA's do-not-call list. By contrast, just five
states -- New York, Kentucky, Indiana, Florida and Missouri -- have
signed up roughly the same number in far less time."[i]

  Today's self-regulatory approaches to Internet privacy are much like
the failed ones employed by the DMA for telemarketing.  They are
difficult to use, confusing, and often offer no real protection at
all.  This report details the current state of privacy on the
Internet, and illustrates the myriad ways in which threats to privacy
are becoming ever more grave, as new technologies are developed, new
practices become commonplace, and companies are not held accountable
for disregarding privacy risks.  Collection of personal information on
the Internet runs rampant, both through direct and indirect means,
both in the open and in secret.  It is imperative that the FTC act now
to correct these market failures.  The FTC effectively and fairly
corrected the failures of a 20th century nuisance-telemarketing.  It
is time for the agency to move into the 21st century and correct the
failures of self-regulation to meaningfully protect Internet privacy.

  II. Ten Years of Self-Regulation and Still No Privacy In Sight

  EPIC has completed three Surfer Beware reports assessing the state
of privacy on the Internet. "Surfer Beware I: Personal Privacy and the
Internet," a 1997 report, reviewed privacy practices of 100 of the
most frequently visited web sites on the Internet.  It checked for
collection of personal information, establishment of privacy policies,
cookie usage, and anonymous browsing.  The inquiry found that few
sites had easily accessible privacy policies, and none of these
policies met basic standards for privacy protection.  However, at that
time, most of the sites surveyed allowed users to access web content
and services without disclosing any personal data. The report ended
with a recommendation of continuing support for anonymity and the
development of both good privacy policies and practices.

  In 1998, EPIC produced "Surfer Beware II: Notice Is Not Enough," a
report based on a survey of the privacy practices of 76 new members of
the Direct Marketing Association ("DMA"), a proponent of
self-regulation of privacy protection. The DMA released guidelines in
1997 that would require all future members of the DMA to publicize
privacy policies and provide an opt-out capability for information
sharing.  Of the 76 new members surveyed, only 40 had web sites, and
only 8 of these sites had policies satisfying the DMA's requirements.
The report concluded that DMA's self-regulation efforts were not

  The 1999 report "Surfer Beware III: Privacy Policies without Privacy
Protection" assessed the privacy practices of the 100 most popular
shopping web sites on the Internet. It examined whether these sites
complied with common accepted privacy principles, used profile-based
advertising, and employed cookies. The survey determined that 18 of
the sites had no privacy policy displayed, 35 of the sites used
profile-based advertising, and 86 of the sites used cookies. None of
the companies adequately addressed Fair Information Practices,
commonly-accepted responsibilities covering collection, access to, and
control over personal information. Surfer Beware III concluded that
current practices of the online shopping industry provided little
meaningful privacy protection for consumers.

  The Federal Trade Commission ("FTC") has given self-regulation a
decade to produce reasonable privacy protections online.  The FTC
first visited online privacy in 1995, and with minor fluctuations
since then, has adopted a policy that embraces the idea that
self-regulation is "the least intrusive and most efficient means to
ensure fair information practices online, given the rapidly evolving
nature of the Internet and computer technology."[ii] It certainly is
the least intrusive approach for companies exploiting personal
information, but it has not efficiently ensured Fair Information
Practices.  Of the five Fair Information Practices[iii] endorsed by
the FTC-notice, choice, access, security, and accountability-only
notice can be said to be present as a result of privacy statements.

  The first fluctuation in the FTC's commitment to self-regulation
occurred in 1998, after the agency's survey of online practices showed
that the lowest level of protection for consumer, notice of privacy
practices, was not widely implemented.  In a survey of 1400 web sites
conducted by the Commission, 92% of the commercial sites collected
personal information but only 14% had privacy notices.  Of the
commercial sites, only 2% had a "comprehensive" privacy policy.[iv] In
reaction to these findings, the FTC was "still hopeful" that industry
efforts would produce adequate privacy protections.[v] At the time,
Chairman Pitofsky recommended that Congress pass legislation if
self-regulation failed to produce significant progress.[vi]

  A year later in testimony to Congress, the FTC renewed its faith in
self-regulation, noting that many web sites had adopted privacy
policies.  But protections beyond mere disclosure of practices lagged
behind.  Only a small number of surveyed sites had incorporated
choice, access, and security into their practices. No meaningful
avenue for enforcement existed at all.  Commissioner Sheila Anthony
concurred with the report's findings but dissented from its
recommendations, noting, "industry progress has been far too slow
since the Commission first began encouraging the adoption of voluntary
fair information practices in 1996. Notice, while an essential first
step, is not enough if the privacy practices themselves are toothless.
I believe that the time may be right for federal legislation to
establish at least baseline minimum standards."

        "Notice, while an essential first step, is not enough if the
privacy practices themselves are toothless."

  In 2000, a 3-2 majority of the FTC formally recommended that
Congress adopt legislation requiring commercial web sites and network
advertising companies to comply with Fair Information Practices.[vii]
However, a year later with the appointment of a new FTC Chairman, the
FTC embraced self-regulation again.  Chairman Muris decided to focus
the Commission's attention on enforcing existing laws rather than
create new legislative protections for online privacy.[viii] Chairman
Muris indeed has expanded privacy protections through the creation of
a do-not-call list and with application of the agency's powers to
prevent unfair and deceptive trade practices.

  The overall effect of the FTC's approach has been to delay the
adoption of substantive legal protection for privacy. The adherence to
self-regulatory approaches, such as the Network Advertising Initiative
that legitimized third-party Internet tracking and the Individual
References Service Group principles that concerned sale of SSNs,
allowed businesses to continue using personal information while not
providing any meaningful privacy protection.  Ten years later, online
collection of information is more pervasive, more invasive, and just
as unaccountable as ever-and increasingly, the public is anesthetized
to it.

  It doesn't have to be this way. The FTC has been effective in
protecting privacy when dealing with 20th century nuisances.  It's
time for the FTC to apply the lessons from telemarketing and other
efforts to address the 21st century problem of Internet privacy.

  III. Today's Tracking Methods Are More Pervasive and Invasive

  Seven years ago, EPIC's report Surfer Beware I reviewed the status
of Internet users' privacy rights and protections on the 100 most
frequently visited web sites.  The report was concerned primarily with
the solicitation, collection, use, and protection of personal
information obtained either from user-input forms or cookies.

  Today, there are many more methods through which users can be
tracked, profiled, and monitored in the online world.  Cookie
technology has matured-cookies are widespread and new uses have been
developed. Entirely new technologies have emerged as well, some of
which are all but unknown to consumers.  Few of these methods are
regulated, either internally by industry or externally by
government. Without privacy legislation to protect Internet users from
improper use of the information collected on the web, companies are
unlikely to voluntarily cease privacy-invasive practices.


  Surfer Beware I discussed an Internet tracking technology over which
there was "a great deal of controversy"-cookies.  It found that about
a quarter of the most frequently visited web sites used
cookies. Today, many websites use cookies for one reason or
another. In addition, there are several new wrinkles in the use of
this tracking technology.

  Third Party Cookies

  Today, websites that a user explicitly visits are not the only
entities which place cookies in your web browser-many web sites
contain advertising served by outside commercial providers, and these
providers may also send a cookie to your browser.  These are known as
"third party cookies."  Some web browsers, such as Firefox allow users
to block third party cookies.

  Many web pages today have arrangements with third party ad servers
that serve advertisements to their pages.  For example, the MSN
Privacy Statement lists two dozen third party ad networks that may
place cookies in a user's browser.[ix]

  Privacy policies (such as MSN's) tend to frame these third party
cookies as a benefit to the user, allowing advertisers to "deliver
targeted advertisements that they believe will be of most interest to

  Persistent Cookies

  A persistent cookie is one that remains on a user's computer after
she has quit the browser.  These cookies can be used to set and
remember a user's web site preferences, settings, and passwords from
one browser session to the next, but can also be used for tracking and
monitoring purposes.  A troubling recent trend is to design these
cookies to remain not just for many browser sessions, but for many
years.  Google's search cookie, for example, will not expire until
January 17, 2038.  This kind of long range tracking of users raises
significant privacy risks.

  Web Bugs

  A web bug is a graphic on a web page that allows tracking and
monitoring of visitors to that page. Web bugs are usually invisible,
"clear" images only 1-by-1 pixel in size. They are capable of
transmitting, back to the bug's originating server your Internet
Protocol ("IP") address, the page you visited, the time you visited,
browser information, and information from existing cookies in the

        For market approaches to work, consumers must grasp both
technology and practices.  But in a Pew Internet Report, 56% surveyed
couldn't identify a cookie.[x]

  Web bugs are sometimes used for the innocuous purpose of counting
how many times a particular page is viewed and gathering statistics
about browser usage and web site usage. There are, however, much more
invasive uses, such as compiling a detailed web-browsing profile of a
particular user.

  Web bugs are designed specifically to be secret and invisible.  Many
Internet users today are aware of cookies, and may perceive them from
the appearance of visible advertisements.  There are also tools to
manage cookies. Web bugs, however, can transmit information and set
cookies even when there is no telltale banner advertisement on the
website tipping off a user that information might be collected about
them. Furthermore, just one "allowed" cookie from an ad network opens
the door for all web bugs within that network to collect browsing
information about that user.  With companies such as DoubleClick,
providing advertising to countless web sites, this risk is
significant. For instance, if a user with a DoubleClick cookie in
their browser loads a web page with a DoubleClick web bug on it, that
bug can grab the identifying information in the cookie and transmit it
back to the server along with the other information collected by the

  Google's Gmail Content Extraction

  On April 1, 2004, Google announced the launch of their new Gmail
service.  Gmail is a web-based e-mail service offering one-gigabyte of
e-mail storage to users.  Gmail is supported by advertisers who buy
keywords, much like the Google search engine's AdWords advertising
program, which lead to targeted advertisements displayed alongside an
e-mail message in a Gmail user's inbox. Gmail uses "content
extraction" (a term from Google's patents) on all e-mails sent to and
from a Gmail account in order to target the advertising to the user.

        "If Google ogles your e-mail, will Ashcroft be far behind?"[xi]

  Many privacy advocates hold the position that the Gmail service
violates the privacy rights of both Gmail users and non-subscribers.
Non-subscribers who e-mail a Gmail user have "content extraction"
performed on their e-mail even though they have not consented to have
their communications monitored, nor may they even be aware that their
communications are being analyzed.

  This is a significant development in Internet tracking technology
because it is one of the first with the capacity and the structure to
monitor and record not just transactional data and personal
information, but the content of private communications.


  Spyware and adware are extremely invasive and annoying technologies
that have flourished in the self-regulatory world of Internet
privacy. Both can be broadly described as pieces of software placed on
a user's computer by a third party that perform unwanted
functions. Spyware and adware collect information about the user,
sometimes in complete secrecy without the knowledge of the user.  Some
programs display pop-up ads on the user's monitor, while others track
and record everything the user does online.  Information is sometimes
collected by the programs for the sole purpose of sending that data
back to an advertiser, and other times used to immediately serve
pop-up ads to the user. Users often inadvertently download and install
spyware and adware along with other desired computer programs, most
commonly file-sharing applications.  McAfee, an Internet security firm
that sells popular virus protection and other personal computer
security programs, reported more than 2.5 million "potentially
unwanted programs" on its customers' computers, as of March 2004.[xii]

TELECOM Digest     Sat, 12 Mar 2005 23:53:00 EST    Volume 24 : Issue 111

Inside This Issue:                             Editor: Patrick A. Townson

    A Decade of Disappointment - Part II (Patrick Townson)

(Another article on same topic in this issue)

    Why Pay to be an Identity Thief? CMU Will Show You How (Marcus Falco)

This is part 2 in a 2-part essay written by Chris Jay Hoofnagle on
Privacy.  The first part appeared in the issue before this. The
two parts will be merged into a longer essay for the Telecom Archives.

  Privacy Self Regulation: A Decade of Disappointment
  By Chris Jay Hoofnagle
  March 4, 2005

  IV. More Invasive Tracking Mechanisms Are on the Horizon

  There are several new and emerging technologies that have the
potential to present significant privacy problems as they become more
advanced and more widely used.

  Digital Rights Management

        "Digital copyright management systems.are not some remote,
futuristic nightmare.they will enable an unprecedented degree of
intrusion into and oversight of individual decisions about what to
read, hear, and view."[xiii]

  Digital Rights Management (DRM) systems use technical means to
protect an owner's interest in software, music, text, film, artwork,
etc.  DRM can control file access (number of views, length of views),
altering, sharing, copying, printing, and saving, through either the
software or hardware of a computer or device.

  Some DRM technologies are being developed with little regard for
privacy protection.  These systems require the user to reveal his or
her identity in order to access protected content. Upon authentication
of identity and valid rights to the content, the user can access the
content. Widespread use of DRM systems could lead to an eradication of
anonymous consumption of content.

  DRM systems could lead to a standard practice where content owners
require all purchasers of media to identify themselves.  DRM can also
link or tie certain content inextricably to one particular user.
Windows Media Player, for example, has an embedded globally-unique
identifier that can track users and the content they are viewing.

  Trusted Computing

  Trusted computing is a platform for pervasive DRM in personal
computers.  The Trusted Computing Group, an industry consortium with
members Microsoft, Intel, Hewlett Packard, and Advanced Micro Devices,
is overseeing the creation of industry-wide specifications for trusted
computing hardware and software.

        Computer freedom itself is at stake here.  DRM can convert a
flexible, user-controlled computer into an inflexible,
copyright-owner-controlled surveillance device.  Your next computer
may really be a TV that watches you.

  Trusted computing systems combine hardware and software elements to
create a platform that gives software vendors an incredible amount of
control over what users do with their computers.  These systems have
been developed to protect the security of the computer from its owner
when she uses proprietary or copyrighted information.

  While trusted computing does enable a number of important security
and privacy-enhancing functions, it also creates new threats to
privacy and anonymity that should be seriously considered.  For
example, by augmenting the security functions already present on
personal computers, trusted computing may offer greater protection
from malicious programs or remote exploits.  On the other hand,
Trusted Computing could make it difficult or impossible for users to
access content anonymously.

  As trusted computing technology develops, it could have significant
impact on computer users' privacy in the digital and online world.

  Single Sign On Services

  "Project Liberty" is an online identification and authentication
system.  It allows individuals to use a single sign-on in order to
access many different web pages, and is being developed by a coalition
of companies.  A similar system has been designed by Microsoft, known
as Passport or .NET Passport.

  Identification and authentication systems present privacy risks for
individuals.  They can become virtual tollbooths for the Internet,
requiring identity before one can view web pages. This violates a
fundamental principle of privacy-the idea of collection limitation. It
is illegitimate to collect information unless it is actually necessary
to complete some function. However, with a proliferation of
authentication systems, it becomes easier to compel individuals to
identify themselves for no legitimate reason. These systems also
enable profiling, which results in more spam, direct mail, and
telemarketing for individuals.

  V. The Privacy Friendly Are Mimicking the Privacy Invasive

  In Surfer Beware I, EPIC noted that news web sites usually did not
require disclosure of personal information in order to access their
content, a practice that enhances privacy.  The report stated that
many of the top web sites allow "users to visit without giving up
personal information.  Anonymity plays a particularly important role
for those sites.that are providing news and information to the on-line
community."  EPIC thought that it was especially appropriate for news
sites not to attempt to identify site visitors, as anonymous access to
political information shields individuals from law enforcement
scrutiny and politically-motivated retribution.

  But the ability to view the news anonymously is dramatically limited
now.  More and more news websites are requiring disclosure of personal
information in various forms in order to access news articles.

  EPIC conducted a survey of the websites of the top twenty-five US
newspapers (by daily circulation).[xiv] Thirteen of these top
twenty-five sites require disclosure of some personal information in
order to access content.  Seven newspapers (including three of the top
five) actually require "registration." All seven of these sites
require disclosure of personally identifiable information.  The other
five sites require only disclosure of information which is not, on its
own, personally identifiable (gender, postal code/country, and birth

  Internet users are becoming increasingly frustrated with the
prevalence of registration requirements on Internet sites. Evidence
suggests that users will go out of their way to avoid divulging
personal information on news sites.  Many users who don't want to
divulge personal information in order to read the news online are
engaging in "privacy self defense," as they enter false information in
registration pages, or turn to services such as
Bugmenot is a website through which users can "share" personal login
information, and as of August, 2004, claims to have "liberated" more
than 18,000 pages from the confines of required registration.

  Online users have strong reservations about the use and abuse of
their personal information. Surveys show that people value anonymity,
especially on the Internet, and simply don't want to give up their

        A 2003 Annenberg Survey found that 57% of those polled
believed that if a company has a privacy policy, the company will not
share information with other entities.[xv]

  The mere existence of a "privacy policy" also does not ensure that a
person's information will remain "private" in the common sense of the
word-both the LA Times and Chicago Tribune websites do not allow users
to opt out of information sharing, advertising and communications from
the newspapers and their "affiliates" (although you can opt out of
sharing of your information with their advertisers and other third
parties).  There is also some indication that some newspapers have
been checking the data provided at registration against third party
commercial databases for accuracy.[xvi]

  Compulsory site registration is likely to become a "vicious cycle"
of privacy violations-increasing prevalence of privacy self-defense
through providing "bad" or incorrect information might result in an
increased tendency on the part of newspapers to require more invasive
information from users, and to compare this information to commercial
databases to ensure accuracy.

  VI. Previous Self-Regulatory Initiatives Have Failed

  Instead of driving towards legally accountable privacy frameworks,
the FTC has a predilection towards self-regulatory initiatives.  One
notable effort was the NAI-The Network Advertising Initiative.  The
NAI was announced in 1999 shortly after DoubleClick, an online target
advertising company, was the subject of a FTC investigation.  The
investigation was spawned by reports that the company was planning to
link its anonymous surfing data with detailed offline customer
profiles from Abacus Direct.  Public protest led them to suspend their
plans to merge their anonymous data with the personal information they
had purchased.

  Strong public opposition to online profiling caused Congress and the
FTC to make efforts to address the practice.  In November 1999, the
FTC and Department of Commerce announced the formation of the NAI at a
Workshop on Online Profiling.  Less than a year later and with little
involvement from consumer and privacy groups, the self-regulatory NAI
principles were publicized.

  The NAI standards were too weak to provide privacy commensurate with
surfers' expectations.  They encompassed only notice, opt-out, and
"reasonable" security. NAI members could transfer information amongst
themselves to an unlimited degree, so long as it is used for
advertising.  No meaningful enforcement mechanism was incorporated.

  Even where the NAI set privacy standards, they were burdensome for
individuals to exercise.  For instance, users who didn't want to be tracked
by DoubleClick's cookies had to download and leave an "opt-out cookie" in
their browser.  For those who think that deleting their cookies enhances
their privacy protections, they will have to repeatedly remember to download
the cookie.

  Further contributing to the irrelevance of NAI is the fact that its
membership has depleted to two: DoubleClick and Atlas DMT.

  New Tracking Methods Undermine the Already Weak NAI Provisions

  Behavioral targeting is becoming increasingly popular with web ads
that follow users as they browse the web.  These ads can be targeted
to a visitor's online habits.  Many of these ads rose in popularity
from keyword searches, however, more omniscient tactics are also at
work.  Revenue Science, for instance, offers their customers web bugs
to collect user information.  Individual sites can determine which
data gets used for targeting and the information collected does not
get shared among different sites using the service.  Customers of
Revenue Science include ESPN, Reuters, Dow Jones, Newsweek, The Wall
Street Journal and many others.

  As more network advertisers benefited from electronic espionage, the
relevancy of the NAI dwindled as the two member companies no longer
controlled the industry.  Companies such as Google, Overture,
Aquantive and Omniture are all influential stakeholders in the
targeted advertising market and profiling business.  Although they are
not NAI members, the common theme of self-regulation has remained
popular.  Not surprisingly, the core of the weak NAI principles can
still be identified throughout the privacy policies of the major
network advertisers.

  The NAI Principles Didn't Provide Privacy Then and Don't Provide it

  The NAI principles have not contributed to an environment where
privacy is protected.  Only notice has effectively been conveyed
online.  Although consent varies depending on opt-out/opt-in policies,
most advertisers operate on a no consent or opt-out model.  While
access is often provided for, a user is often only given access to the
information that they have voluntarily provided to the company.
However, in order for meaningful access to be attained, a user must
able to receive the same electronic profile that is of value to the
marketer.  Accountability and enforcement are equally meaningless
concepts without a central authority to monitor and impose the
standards.  Without enforceable rights, Internet users will continue
to be tracked and profiled as they become pawns of the advertising

  IRSG: Freeing the Commercial Data Brokers From Privacy

  The Individual Reference Services Group (IRSG) Principles were
developed by commercial data brokers in the late 1990s in order to
manage fomenting criticism regarding their business model.  These data
brokers sold Social Security Numbers and detailed dossiers on
Americans to marketers, insurers, private investigators, landlords,
and law enforcement.

  The IRSG Principles set forth a weak framework of protections.  They
allowed companies to sell non-public personal information "without
restriction" to "qualified subscribers."  The problem is that everyone
with an account is "qualified."

  Under the IRSG Principles, individuals can only opt-out of the sale
of personal information to the "general public," but commercial data
brokers don't consider any of their customers to be members of the
general public.  For instance, data broker ChoicePoint gives
individuals no right to opt out and claims that "We feel that removing
information from these products would render them less useful for
important business purposes, many of which ultimately benefit

  The IRSG Principles have been carefully crafted in order to ensure
maximum flexibility for data brokers. They represent another
self-regulatory failure that has resulted in easy access to detailed
dossiers on Americans by both commercial and law enforcement
interests.  By turning a blind eye to the commercial sector, Congress
allowed commercial data brokers to become "Big Brother's Little
Helpers."  They have created a national data center of personal
information for law enforcement.[xvii]

  NAI and IRSG Were Successful-For Those Invading Privacy

  These self-regulatory initiatives served their purpose-to stop
Congress from creating real, enforceable rights while allowing
privacy-invasive activities to continue.  They placated the FTC,
causing Congress not to act.  The end result has been that the FTC
hasn't taken action to address traditional network advertisers or
newer forms of privacy invasive tracking.  Similarly, since Congress
didn't act on data brokers, the IRSG has dissolved, and its member
companies continue to sell personal information widely.

  VII. Anonymous Purchasing Options: Another Market Failure

       A list of Internet shoppers who paid with an American Express
card.  The company offering the list, American List Counsel, offers to
segment the consumers by age, estimated income, dollar amount per
order, and annual purchase amount.  Even if a given online retailer
extends strong privacy protections to customers, popular payment
methods are not anonymous and provide an avenue for online profiling.
Credit card companies use and sell personal information for target
marketing, and provide an easy trail for law enforcement access to
purchasing information.

  Currently, there are not ubiquitous and easy to use anonymous online
purchasing mechanisms. Companies in recent years have offered
anonymous purchasing services based on various models, but these
approaches tend to be cumbersome and costly.

  In testimony to Congress in 1997, the Federal Trade Commission
discussed anonymous payment systems and recommended that: "federal
government should wait and see whether private industry solutions
adequately respond to consumer concerns about privacy and billing
dispute resolution issues that arise with the growth of electronic
payment systems, and then step in to regulate only if those efforts --
be they market-created responses, voluntary self-regulation or
technological fixes, or some combination of these -- are
inadequate."[xviii] How much longer does the consumer have to wait for
user-friendly, ubiquitous anonymous payment options?

  VIII. Information [In]Security

  One of the five fair information practices endorsed by the FTC is
security-the responsibility that data collectors take reasonable steps
to assure that information collected from consumers is secure from
unauthorized use.[xix]

  Collection of personal information creates security risks for
individuals.  As companies amass personal information or send it
elsewhere for processing, the databases become attractive targets for
malicious actors.

  It is difficult for individuals to assess the security and integrity
of data collectors' systems.  And recent events indicate that security
in the data collection and processing industries falls fall short of
being "reasonable."  A recent case in point involves Acxiom, a
publicly-traded corporation that sells personal data and processes it
for client companies.  In a written statement to the FTC in June 2003,
Acxiom's CEO assured that its security practices were "exceptional"
and multi-leveled: ".it must be noted that Acxiom undertakes
exceptional security measures to protect the information we
maintain.and around the information we process for our clients to
ensure that information will not be made available to any unauthorized
person or business."[xx]

  A month after making this statement, Acxiom was informed by law
enforcement officials that an Ohio man was able to download and crack
Acxiom's password database.  The method of stealing the personal
information shows that Acxiom did have extraordinary security
measures-the problem was that they were extraordinarily sloppy.  The
man, using FTP access operated for Acxiom's clients, was able to
browse around Acxiom's system and download a single file containing
all the passwords.[xxi] In the course of the Ohio investigation,
Acxiom learned that a second man used the same technique to access
over 8 gigabytes of personal information from April 2002 to August

        Acxiom did have extraordinary security measures-they were
extraordinarily sloppy.

  And, while the SSNs and credit card numbers of 20 million were
accessed, the identities of companies that provided the personal
information to Acxiom remain secret.

  Other indications of information insecurity abound thanks to a
California law that took effect in July 2003.  That law requires data
collectors to notify individuals when their data has been stolen.  As
a result, the public has heard of many information security breaches
that normally would have been kept secret.

  The first publicized notice of a security breach involved a banking
consultant who had financial details on his computer.  An office
burglar stole the computer, which had credit line information, Social
Security Numbers, and other bank account information.[xxiii] Since
then, news of security breaches routinely appear in the national

  IX. Bad Online Practices Are Leeching into the Offline World

  The trend of collecting personal information and monitoring purchase
habits is not strictly limited to the on-line environment.
Increasingly, merchants are requiring consumers to produce
identification or reveal personal information at the point of sale or
when they wish to return or exchange an item.

  What's Your Phone Number?

  Increasingly, cashiers are asking individuals for their phone
numbers.  This places individuals at risk that they will receive
telemarketing based on the most trivial of purchases in the offline

        Consumers don't realize that giving a phone number to a
cashier invites telemarketing under the "established business
relationship" loophole to the Telemarketing Do-Not-Call Registry.

  But the problem extends beyond a cashier's request for information,
rather, it is the presumption that the disclosure of personal
information has become a precondition of sale.  While a customer may
feel uneasy about revealing this information, many do not know that
this disclosure is voluntary.  And because individuals want to shield
their personal information from disclosure, some data companies have
developed stealth information collection techniques for offline
retailers.  For instance, Trans Union, a credit reporting agency,
offered "Translink / Reverse Append," a product that gave retailers
name and address information from credit card numbers collected at the
register.[xxiv] Consumers are not actually asked for their address,
and probably are not aware that their address is discoverable.

  The exact purpose for this information collection varies from store
to store.  Nine West asks for customer information in order to create
a database of transaction histories for each customer, containing shoe
size and width.  Victoria's Secret has recently begun asking
customer's for their telephone numbers so that they may be informed of
promotions. Sometimes, it is difficult to find out how the information
is being used.

  Grocers Get Loyalty and We Get Less

  Frequent shopper or loyalty card programs vary depending on the type
of retailer or service.  Generally, grocery stores will offer loyalty
cards where a customer reveals a significant amount of personal
information in exchange for a card which makes them eligible for
in-store discounts. There is a high privacy risk associated with these
cards as a great deal of personal data is revealed and all purchased
are tracked.

  Consumers are led to believe that they saving money when in reality,
the prices at non-savings card stores are often lower.

        The Wall Street Journal reported that, ".according to industry
experts.[loyalty] cards are designed to make customers feel like they
got a bargain, without actually lowering prices overall."

  A 2003 Wall Street Journal study found that "most likely, you are
saving no money at all [from supermarket shopping cards]. In fact, if
you are shopping at a store using a card, you may be spending more
money than you would down the street at a grocery store that doesn't
have a discount card."[xxv]

  The Wall Street Journal study surveyed card and non-card grocery
stores in five different American cities and concluded that "In all
five of our comparisons, we wound up spending less money in a
supermarket that doesn't offer a card, in one case 29% less."[xxvi]
The author further wrote that ".according to industry experts, our
shopping experience was typical, because cards are designed to make
customers feel like they got a bargain, without actually lowering
prices overall. 'For many customers, the amount of money saved has not
risen,' says Margo Georgiadis, a specialist in loyalty programs at
McKinsey & Co. The difference is that stores now make you carry a card
to get the discounts, whereas before they just offered plain old sale

  Making a Return? Your Papers Better Be in Order

       A receipt from H&M, a popular clothing store, which now
requires government issued photo identification for all returns.

  A review of the return policies of select retailers indicates that
asking for identification for returns, even when an original receipt
is present, is becoming a common practice.  In some situations, this
requirement is even printed on the receipt while other merchants fail
to post any notice of this condition.  While some retailers simply
take the identification to match the name and contact information,
others go as far as to enter the driver's license number into their
computer system.  Often, a customer might not even know that this is
occurring, or they may feel as though the recording of their driver's
license number is a necessary step.  Given the sensitivity of the
information contained on a driver's license, when combined with credit
card information that is often available at a return, this practice
places the customer at risk of identity theft.

  Consumer Returns Database

  Some point of sale return information is being added to a
little-known system known as the "Consumer Returns Database."[xxviii]
The database is offered by The Return Exchange which offers a
standardized return system to retailers. It operates in real-time by
monitoring consumer return patterns it helps merchants identify
fraudulent or abusive customers.

  It is unclear what standards are applied to identify an abusive
customer, or the rights that a customer has to access and correct the
database.  A list of the retailers who participate in the database is
not publicly available.  By the time a customer is aware that negative
information exists about them in the database, it is because they have
already been branded as a fraudulent or abusive returner.

  Firing the Customer

  Combined, collection of returns information and loyalty behavior can
tip the balance of power between the consumer and the retailer.  Left
unchecked, this data will be used for customer exclusion.  As the
Boston Globe recently put it, slow service or unattractive prices are
being used "as a behavior modification tool to transform an
unprofitable customer into either a profitable customer or a former

        "Filene's banned two sisters from all 21 of its stores last
year after the clothing chain's corporate parent decided they had
returned too many items and complained too often about

  There is a growing movement in the "customer relationship
management" or profiling industry where businesses are encouraged to
eliminate customers who complain or who return goods.  Jim Dion,
president of retail consulting firm Dionco Inc., recently urged
storeowners to create disincentives for certain customers.[xxx] Dion
characterized 20% of the population as "bottom feeders," who complain
and have low-levels of loyalty.  Businesses, he argues, should try to
eliminate these customers: "It'd be cheaper to stop them at the door
and give them $10 not to come in."[xxxi] An article in DMNews quotes
Dion as suggesting that retailers "should consider a
preferred-customer database-prefer that they don't shop here."[xxxii]

  And major businesses are adopting these recommendations.  Best Buy's
consumer exclusion tactics were recently detailed by the Wall Street
Journal.  Literally, Best Buy is trying to eliminate its most savvy
customers, ones that recognize good deals, in favor of less thrifty
customers that the company can charge more.[xxxiv] Other companies
engage in consumer exclusion in more subtle ways, for instance,
Harrah's casinos automatically identifies callers and charges them for
hotel rooms based on their perceived profit potential.[xxxv] The
company hides the profiling system because consumers, if fully
informed, would find the practices creepy.

  First-Degree Price Discrimination

  "First-degree price discrimination," a practice where businesses
attempt to "perfectly exploit the differences in price sensitivity
between consumers," is a growing problem resulting from collection of
consumer information.[xxxvi] As Professor Janet Gertz has explained:
"By profiling consumers, financial institutions can predict an
individual's demand and price point sensitivity and thus can alter the
balance of power in their price and value negotiations with that
individual. Statistics indicate that the power shift facilitated by
predictive profiling has proven highly profitable for the financial
services industry. However, there is little evidence that indicates
that any of these profits or cost savings are being passed on to
consumers. For this reason, and because most consumers have no
practical ability to negotiate price terms for the exchange of their
data, many characterize the commercial exploitation of consumer
transaction data as a classic example of a market failure."[xxxvii]

  First-degree price discrimination is a goal of some in the
information business.  CIO Insight Magazine recently published an
article discussing pricing ceilings where price discrimination is
described as a goal for the industry: "The ideal strategy? To capture
the value of the product or service for a particular customer or
customer segment."[xxxviii]

  X. Recommendations

  The FTC has to move into the 21st century and meaningfully address
Internet privacy.  Ten years of self-regulation has led to serious
failures in this field. The online privacy situation is getting worse,
so bad that offline retailers are emulating the worst Internet

  The FTC certainly is capable of protecting privacy online. It has to
rise to the challenge and exercise more skepticism in the market as a
proxy for consumer interest.  Sometimes the market advances consumer
interests, but when it comes to privacy, the market has been a driving
force in eroding both practices and expectations.  In order to rise to
the challenge of effectively protecting individuals' privacy, we
recommend the following:

    a.. The FTC should abandon its faith in
self-regulation. Self-regulatory systems have served to stall Congress
while anesthetizing the public to increasingly invasive business
practices.  Self-regulation has only been reliable in promoting
privacy notices, the least substantive aspect of privacy protection.
The public's, and even the FTC's own conception of Fair Information
Practices, commands a broader array of privacy protection including
access, choice, security, and accountability.  b.. The FTC should
reexamine the Network Advertising Initiative in light of the
agreement's dwindling membership and the existence of new, more
invasive tracking measures.  c.. The FTC should reexamine the IRSG
Principles to ensure that they provide some measure of meaningful
privacy.  d.. The FTC should investigate the emerging technologies
identified in this report, including digital rights management,
trusted computing, and single sign on services.  e.. The FTC should
investigate the emerging offline business practices identified in this
report, including unnecessary requests for information at point of
sale or return, customer return databases, customer exclusion, and
first degree price discrimination.  f.. The FTC should work with the
banking agencies to develop a unified mechanism for opting out under
the Gramm-Leach-Bliley and Fair Credit Reporting Acts.  Just as it
made no sense for individuals to opt-out of every telemarketing call,
it currently makes no sense for an individual to have to contact every
single financial institution separately to protect privacy.

  *This report was written with assistance from EPIC Internet Public
Interest Opportunity Program (IPIOP) Clerks Dina Mashayekhi, Tara Wheatland,
and Amanda Reid.

  [i] Consumers deserve stronger shield against telemarketers, USA Today,
Sept. 17, 2002.  In just one year, the New York DNC list amassed 2 million
enrollments.  Telemarketing's Troubled Times, CBS News, Apr. 1, 2002, at

  [ii] Self Regulation and Privacy Online, Before the House Commerce
Subcomm. on Telecom., Trade, and Consumer Protection, 106th Cong., Jul. 13,
1999, available at

  [iii] FTC, Staff Report: Public Workshop on Consumer Privacy on the Global
Information Infrastructure, Dec. 1996, available at

  [iv]FTC, Privacy Online: A Report to Congress, Jun. 4, 1998, available at

  [v]FTC, Self-regulation Is the Preferred Method of Protecting Consumers'
Online Privacy; Jul. 21, 1998, available at

  [vi] Consumer Privacy on the World Wide Web, Before the House Comm. on
Commerce Subcomm. on Telecommunications, Trade, and Consumer Protection,
105th Cong. (Jul. 21, 1998) (statement of the FTC), available at

  [vii]FTC, Online Profiling:A Report to Congress Part 2 Recommendations,
Jul. 2000, available at

  [viii] Timothy J. Muris, Protecting Consumers' Privacy: 2002 and Beyond,
Remarks delivered at the Privacy 2001 Conference, Oct. 4, 2001, available at

  [ix] Ad4Ever; AdCentric Online; Ad Dynamix;  AdSolution; Avenue A;
BlueStreak; BridgeTrack; DoubleClick; efluxa; Enliven; Flycast; i33;
Mediaplex; PlanetActive; Pointroll; Profero; Qksrv; RealMedia; RedAgency;
TangoZebra; TargetGraph; TrackStar; Travelworm; Unicast.

  [x]Pew Internet & American Life Project, Trust and Privacy Online: Why
Americans Want to Rewrite the Rules, Aug. 20, 2000.

  [xi] Company Needs to Engage Privacy Advocates in a Thorough Debate, San
Jose Mercury News, Apr. 15, 2004.

  [xii] David McGuire, States Speed up Spyware Race, Wash. Post, May 13,
2004, available at

  [xiii] Julie E. Cohen, A Right to Read Anonymously: A Closer Look at
"Copyright Management" in Cyberspace, 28 Conn. L. Rev. 981 (Summer 1996).

  [xiv]BurrellesLuce, Top 100 Daily Newspapers in the U.S. by Circulation

  [xv] Joseph Turow, Americans and Online Privacy: The System is Broken,
Annenberg Public Policy Center, June 2003.

  [xvi] Rachel Metz, We Don't Need No Stinkin' Login, Wired Jul. 20, 2004,
available at,1377,64270,00.html

  [xvii] Chris Jay Hoofnagle, Big Brother's Little Helpers, 29 N.C.J. Int'l
L. & Com. Reg. 595 (Summer 2004).

  [xviii]FTC, Wait, Watch Closely and See is Right Stance for Government on
Privacy Issues for Electronic Payment Systems, Says FTC Official, Sept. 18,
1997, available at

  [xix]FTC, Online Profiling:A Report to Congress Part 2 Recommendations,
Jul. 2000, available at

  [xx] Information Flows, Before the FTC, Jun. 18, 2003, available at

  [xxi] Robert O' Harrow, Jr., No Place to Hide 71-72, Free Press (2005).
DOJ, Milford Man Pleads Guilty to Hacking Intrusion and Theft of Data Cost
Company $5.8 Million, Dec. 18, 2003, available at

  [xxii]DOJ, Florida Man Charged with Breaking Into Acxiom Computer Records,
Jul. 21, 2004, available at

  [xxiii] Customer Data Was on Stolen PC, Wells Fargo Says, Reuters, Nov.
21, 2003.

  [xxiv] In re Trans Union, 2000 FTC LEXIS 23 (2000).

  [xxv] Katy McLaughlin, The Discount Grocery Cards That Don't Save You
Money, Wall Street Journal, Jan. 21, 2003, at,,SB1043006872628231744,00.html.

  [xxvi] Id.

  [xxvii] Id.


  [xxix] Bruce Mohl, Facing their demons: To face demons, firms dump maxim,
Boston Globe, Jul. 27, 2003.

  [xxx] Mickey Alam Khan, Technology Creates Tough Environment for
Retailers, DMNews, Jan. 13, 2003.

  [xxxi] Id.

  [xxxii] Id.

  [xxxiii] Joshua Freed, The customer is always right? Not anymore, San
Fran. Chron., Jul. 5, 2004.

  [xxxiv] Gary McWilliams, Analyzing Customers, Wall Street Journal, Nov. 8,

  [xxxv] Christina Binkley, Taking Retailers' Cues, Harrah's Taps Into
Science of Gambling, Wall Street Journal, Nov. 22, 2004.

  [xxxvi] Anthony Danna & Oscar H. Gandy, Jr., All That Glitters is Not
Gold: Digging Beneath the Surface of Data Mining, 40 Journal of Business
Ethics 373, 381 (2002).

  [xxxvii] Janet Dean Gertz, The Purloined Personality: Consumer Profiling
in Financial Services, 39 San Diego L. Rev. 943, 964-5 (Summer 2002).

  [xxxviii] Amy Cortese, Price Flexing: How the Web Adds New Twists, CIO
Insight, at,3959,43528,00.asp.

  [Inside Back Cover: Personal information sold by magazines. Some segment
their subscribers by age, sex, religion, and whether there are children in
the household.]

  [Back Cover: More lists of personal information sold based on Internet
registrations. List brokers sell personal information en masse segmented by
age, sex, sexual orientation, and race.]

[TELECOM Digest Editor's Note: This report came to us from EPIC, and
you can examine the several good reports at their web site:, or read the original report at its URL:
Page URL: .

In the archives, these two parts (last issue and current issue) will 
be merged into one.    PAT]

(Another similar article in the same issue V24_#112)

Date: Sat, 12 Mar 2005 22:43:29 -0500
From: Marcus Didius Falco <>
Subject: Why Pay to be an Identity Thief? CMU Will Show You How

    ------ Forwarded Message
    From: Steven Cherry < >
    Date: Sat, 12 Mar 2005 02:33:41 -0500
    To: "David J. Farber" < >
    Subject: Why Pay to be an Identity Thief?


We just posted an article I think of interest to IP:

Why Pay to be an Identity Thief? Experimental Software Makes It Free

By Steven Cherry

Thieves purchased sensitive personal data from ChoicePoint, but a
Carnegie Mellon University researcher can get the same information
free on the Web

    Steven Cherry, +1 212-419-7566
    Senior Associate Editor
    IEEE Spectrum, 3 Park Ave,  New York, NY 10016

    ------ End of Forwarded Message

Why Pay to be an Identity Thief? Experimental Software Makes It Free

By Steven Cherry

Thieves purchased sensitive personal data from ChoicePoint, but a Carnegie
Mellon University researcher can get the same information free on the Web

11 March 2005 -- The U.S. database industry is under a legal microscope
following the pilfering of information that could allow thieves to
steal the identities of hundreds of thousands of people. In a hearing
yesterday, senators threatened legislation to regulate large brokers
of financial and other data such as Lexis Nexis, Bank of America, and
Choicepoint all of which have disclosed problems in the last two
months. It was the incident at Alpharetta, Ga.-based ChoicePoint that
kindled the current concern in Washington, D.C. In mid-February the
firm, whose data is used to check the legitimacy of the potential
customers of other companies, revealed that it had been tricked into
selling the records of 145 000 people to thieves posing as legitimate
ChoicePoint customers.

But why should an identity thief bother with an expensive charade?
Carnegie-Mellon University associate professor of computer science,
Latanya Sweeney, has found an even simpler way than paying a company
in the personal database industry, which critics say is
underregulated. She's found a way to extract all the data she wants
for free from the World Wide Web. For over a decade, Sweeney has been
exploring the intersection of technology and privacy. Her latest work
builds on earlier Web-searching tools that create software agents to
extract names, address, birth dates, and Social Security numbers from
resumes posted online; everything you need to apply for a new credit
card in someone else's name. Sweeney will report= her findings at a
symposium devoted to national security sponsored by the American
Association for Artificial Intelligence and held at Stanford
University, in California, 21 - 23 March.

With her software, Sweeney can gather the key data with just a little
Web surfing. She starts with a filter that searches for documents
likely to be resumes and then extracts the key data values: name,
social security number, address, and date of birth. R=E9sum=E9s are
found in a two-part process: first, a program Sweeney wrote last year
finds long lists of names. Then a specialized Google search filter
looks for resumes associated with those names that contain Social
Security numbers.

Social Security numbers and the other needed fields, such as birth
date, are isolated using a combination of techniques. For example,
dates can be formatted in several different ways, but there are now
standard techniques for parsing them. If a resume has all the needed
data except a birth date, the software grabs it from one of the many
sites that offer them, such as Social Security
numbers have a distinctive format: nnn-nn-nnnn. Another program of
Sweeney's, SSN Watch, checks the numbers that are found.

How important are those Social Security numbers? Last September, the
commissioner of the U.S. Federal Trade Commission told Congress that
they play "a pivotal role in identity theft. Identity thieves use the
Social Security number as a key to access the financial benefits
available to their victims."

Obviously, if people are posting their Social Security numbers to the
Web, and if doing so leaves them highly vulnerable to identity theft,
then they ought to stop. Sweeney's work addressed that issue. The
Identity Angel project, which she launched earlier this year, looks
for e-mail addresses in those resumes, and sends individuals automated
notices that their identity information was found online. She says a
follow-up study showed that more than 90 percent of the people
subsequently removed the information from the Web.

Nonetheless, even with a digital Samaritan patrolling the ether, U.S.
identities remain at risk. A November study by the U.S. Government
Accountability Office found that "Social Security numbers appear in
any number of records exposed to public view almost everywhere in the
nation, primarily at the state and local levels of government."

The GAO reported that many states and hundreds of the nation's 3141
counties put Social Security numbers directly on the Internet and that
"this could affect millions of people." The agency concluded that the
risk of exposure for Social Security numbers in public records "is
highly variable and difficult for any one individual to anticipate or

That risk is much lower across the Atlantic, where a 1995 European
Union directive on data privacy ensures that personal data is kept
secret by default.

According to Stephen J. Kobrin, a professor of multinational
management at the University of Pennsylvania, in Philadelphia, this
represents a fundamental difference between the United States and
Europe. "In America privacy is seen as an alienable commodity subject
to the market," he wrote in 2002 report. In contrast, he says, in
Europe, privacy is considered to be "a fundamental human right." Not
only do explicit privacy statutes exist there, but they are also
enforced by dedicated regulatory agencies.

In other words, the current U.S. crisis of identity theft is a result
of policy choices that Americans have made, sometimes implicitly,
sometimes explicitly. They are choices that can be revisited anytime.

NOTE: For more telecom/internet/networking/computer news from the daily
media, check out our feature 'Telecom Digest Extra' each day at . Hundreds of new articles daily.

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