State Eyes Do-Not-Track Legislation

Wed, Apr 6, 2011 at 5:16 pm

    Senate bill could put California in the forefront of the fight over online privacy.

    SACRAMENTO AND SAN FRANCISCO, CA — California is putting itself in position to lead the fight for increased online privacy by trying to pass the country’s first so-called do-not-track law to keep personal data from being grabbed off the Internet.

    Legislation by state Sen. Alan Lowenthal (D-Long Beach) would create a mechanism to allow users of smartphones, tablets, computers and any other device that accesses the Internet to tell website operators they don’t want their online habits monitored.

    As California did with do-not-call efforts to block telemarketers, he said, the state should be out front in blocking online tracking. “We will lead and provide stimulus to the rest of the nation,” Lowenthal said. “It’s much more difficult to get something like this through Washington.”

    Momentum is growing for do-not-track legislation, either as a stand-alone protection for consumers or part of more comprehensive privacy reform, privacy experts say. California’s bill signals that the final push might come from the states, not the federal government.

    “The states have been quiet in this area for a couple of years,” said Mike Zaneis, general counsel of the Interactive Advertising Bureau, a trade group for the $23-billion online industry. “Leave it to California to jump in.”

    Lowenthal said he believed a law could be enacted quicker in California because Democrats control the Legislature and the governor’s seat. Even so, he said, protection of Internet privacy is not a particularly partisan issue, because all lawmakers’ constituents are concerned about privacy for themselves and their children.

    “I’m interested in this, and I think there may be some abuses in this area,” said state Sen. Tom Harman (R-Huntington Beach), a member of the Judiciary Committee, which will hold an initial hearing on the Lowenthal bill on April 26. “California does have a track record of leading the way on privacy issues.”

    The proposed legislation is similar to federal Internet privacy bills introduced this year in Congress by Rep. Jackie Speier (D-Hillsborough) and others.

    Speier’s proposal stems from a Federal Trade Commission report in December that urged the Internet industry to give consumers a means to keep personal information private.

    The FTC is exploring whether consumers should be able to control the kinds of online ads they see or to stop websites from monitoring where they go and what they do on the Web. Online advertisers favor self-regulation. For example, Google Inc. and Yahoo Inc. offer ways for consumers to see how they are being “targeted and to opt out of that targeting.”

    Lowenthal’s bill would empower the state attorney general to issue regulations requiring a simple, user-friendly method that allows users to block programs that track online information, including addresses and names. Violations could be targeted with civil lawsuits filed by individuals and the state attorney general.

    “Nearly 80% of Californians use the Internet and nearly 45% use Facebook, including myself,” Lowenthal said. “But, today, millions of Californians are unaware that their online behavior is being tracked, their data collected and sold to advertisers.”

    Passage of a California bill could reignite the national debate over electronic privacy, said watchdog Jeffrey Chester, executive director of the Center for Digital Democracy in Washington.

    “California has pioneered protecting consumer privacy, including for the Internet, often helping create a model used for subsequent federal legislation,” he said.

    “Bringing the do-not-track debate to the Golden State places new pressure on Google, Facebook and other online marketing giants who have been fighting against new privacy rules,” he said.

    Chester and other proponents of do-not-track laws point to California’s 2002 passage of a do-not-call telemarketing bill as a precedent. However, the California law never took effect because the federal government issued its own do-not-call regulations in mid-2003.

    Pressure from both Washington and Sacramento could force Silicon Valley executives “to consider supporting some form of compromise on privacy,” Chester said.

    Some of those changes are underway.

    Three major Internet browsers — Google’s Chrome, Mozilla’s Firefox and Microsoft’s Internet Explorer 9 — now offer features that can block online tracking. But Lowenthal noted that the features can be cumbersome to use and that individual websites are not required to

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    Google declined to comment on the bill. Yahoo said only that it was reviewing the bill and would address lawmakers’ concerns.

    The industry has been fighting do-not-track efforts, which it said could cripple online advertising networks, Web publishers and technology companies if a vast majority of online users chose not to have their Internet activity tracked.

    Yahoo and many of its competitors get much of their sales from advertising based on which sites users visit. Google would be less affected because it generates most of its revenue from search advertising, which doesn’t involve tracking.

    Online advertisers argued that consumers want their data shared to customize news sites, to store shopping preferences and to retrieve relevant content on the Web. Knowing more about consumers also allows advertisers to show ads to consumers who are more likely to want to see them, such as Viagra ads targeted to men.

    Advertisers also warned that restricting the monitoring of consumers on the Internet could impede its growth and reduce consumers’ access to free content supported by advertising.

    Zaneis, of the industry trade group, said he had not seen the California bill but believed it would be a “pretty cut-and-dried case of unconstitutional restriction on interstate commerce.”

    Under the legislation, the California attorney general’s office would end up writing technical restrictions for the entire Internet because almost every commercial website is available to a California resident, Zaneis said.

    If other states pass similar laws, the Internet could be hobbled by a patchwork of different legal restrictions, he said.

    The bill conforms with the state Constitution’s specific creation of the right to privacy, said Jamie Court, president of Consumer Watchdog, a Santa Monica advocacy group.

    A number of recent public opinion surveys have shown support for do-not-track mechanisms. Consumer Watchdog said a poll commissioned last summer showed that 84% of respondents wanted to prevent online companies from tracking personal information without a person’s explicit, written approval.

    “Do-not-track has been a wonderful lever and a great conversation starter,” said Ryan Calo, director of the Consumer Privacy Project at Stanford Law School.

    “It grows out of the recognition that the current state of affairs can’t stay,” he said. “Consumers either don’t know they are being tracked or understand they are but don’t know what to do about it.”

    Contact the authors at [email protected] and [email protected]

    Times staff writer Jim Puzzanghera contributed to this report.

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