Comments of eTRUST Concerning Consumer On-Line Privacy - P954807
eTRUST requests to participate in "Session Two: Consumer Online Privacy" and "Session 3: Children's Online Privacy" at the June FTC hearings. eTRUST wishes to present its self-regulatory privacy initiative, which will be launched concurrently with the hearings. In addition, eTRUST will provide and discuss the results of the consumer and merchant privacy surveys conducted in collaboration with the Boston Consulting Group, and the Pilot program which eTRUST has conducted over the past several months.
Growing concerns about the security and privacy of personally identifiable information are threatening to constrain the growth of electronic commerce. The goal of the eTRUST program is to increase consumer trust and confidence in electronic transactions, and to provide an industry driven solution to the problems of online privacy. In addition, the eTRUST project will educate consumers and industry about online privacy issues.
eTRUST's first project addresses online privacy. The organization has developed and will license recognizable and credible symbols, "trustmarks" of privacy and security to Online merchants. In order to increase the level of confidence in online privacy, eTRUST will provide assurance and monitoring (through both active and passive means) of the business practices of entities that have the ability to collect, use and distribute personal information.
eTRUST is a global initiative which was launched in July 1996 by the Electronic Frontier Foundation (EFF) and a group of pioneering Internet companies. CommerceNet and the EFF then partnered in October 1996 to move forward in implementing the initiative.
eTRUST has conducted a consumer study which reveals that privacy of personal information on the Internet is a consistent, significant concern for consumers--greatly limiting their commercial Internet activity and impeding growth of electronic commerce. According to the eTRUST Internet Privacy Study, conducted by the Boston Consulting Group, over 70 percent of the 9,300 consumers who responded to an online survey are more concerned about privacy on the Internet than they are about information transmitted by traditional media such as phone and mail.
The survey also indicates that consumers' mistrust often leads them to either refuse to provide information on the Internet or to give inaccurate information:
Over 41 percent of respondents report leaving Web sites when asked to provide registration information on the Internet.
In addition to the above, another 27 percent of respondents provide false personal information on Web site registration forms.
eTRUST has also conducted a Pilot program to test the guidelines, the assurance process, and the "branded" system of disclosure and informed consent. Over 50 companies, both domestic and international, have participated in the eTRUST Pilot. In addition, over 500 Sites have currently applied to become members of the eTRUST program. eTRUST has received consistent positive feedback from both consumers and Pilot participants, and will present the results of the Pilot at the June hearings.
eTRUST wishes to present the findings of the BCG study and the eTRUST Pilot in response to questions 2.4, 2.6, 2.7, 2.10. They are enclosed with this letter.
Session Two and Three: Consumer Online Privacy
2.4 What surveys, other research, or quantitative or empirical data exist about consumers perceptions, knowledge, and expectations regarding (1) whether their personal information is being or should be collected by Web site operators and the extent of such collection; (2) The benefits and risks associated with the collection and use of this information; (3) appropriate uses of such information; and (4) whether certain categories of information should never be collected or disclosed to others.
eTRUST has conducted an extensive survey of over 9300 consumers and 70 merchants in conjunction with the Boston Consulting Group. This Survey addresses all of the above concerns, and is attached herein.
3.11 What industry principles, recommendations or guidelines have emerged since the June 1996 Workshop (in regard to self-regulation of children's sites). Please discuss whether they are permissive or mandatory, whether they include sanctions for noncompliance, and to the extent to which they have been implemented within the industry.
eTRUST has not yet addressed the issue of children's online privacy. However the eTRUST system of disclosure, assurance, and enforcement could easily be extended to apply to sites which deal with children, if the member sites attested to specific guidelines. As of yet, eTRUST has avoided creating guidelines of any kind; instead eTRUST simply requires that companies disclose what information they are collecting, with whom they share information, and for what purpose the information is collected. eTRUST then monitors the sites to ensure they have complied with their stated policies.
However, eTRUST anticipates that it may eventually design or recommend privacy profiles for sites which target children, and is eager to engage in this dialogue.