Why the FTC's Myspace case matters to your business: Part 3

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The terms of FTC law enforcement actions apply just to the company in question and the proposed settlement with social network Myspace for alleged privacy-related glitches is no exception. But how should other businesses respond?

Some will scan the headline to make sure their company isn’t named and then do that fingers-in-the-ears la-la-la thing. But savvy executives know that understanding where another company might have gone wrong is a good way to keep their company in the right. What tips can your business take from the FTC’s settlement with Myspace and other recent privacy cases?

Assurance policy. You may be tired of hearing it, but it bears repeating: Review your privacy policy and double-check that what you promise — expressly or by implication — comports with your day-to-day practices. Like any other claim, what you say about how you handle information has to be truthful and backed up with solid proof. The FTC’s lawsuit alleges that Myspace’s policy made assurances the company didn’t honor. Sure, have your legal eagles review it, but include your operations people in the conversation. They’re more likely to know what's really happening behind the scenes. Simply put, promise only what you know for a fact you deliver.

Default lines. Myspace’s default settings allowed users’ full names to be publicly accessible. Of course, each site is different, but give your default settings serious consideration. Don’t make those decisions by, uh, default. If people have choices about what information will be shared, make it easy for them to understand how and where they can exercise their options.

Everything but the kitchen sync? According to the FTC’s complaint, Myspace made it possible for ad networks to match up — or sync — a user’s Friend ID with other data in a way that gave them access to a user's personal information, including in many cases his or her full name. The FTC says that flew in the face of promises Myspace made in its privacy policy. Smart companies think about how easy it might be for others to sync information in a way that would render their privacy promises misleading. (FTC Chief Technologist Ed Felten talks more about that in his Tech@FTC blog.)

May I take your order? Once a company is under FTC order, compliance is legally enforceable. But many provisions in recent orders just make good business sense and cost next to nothing to put in place. For example, the Myspace order, requires the company to designate someone to be responsible for implementing and carrying out the mandated privacy program. Of course, data security and privacy are every employee’s responsibility. But now that you’re building them into your daily operations, doesn’t it make sense for businesses of all sizes to name an in-house point person to coordinate those efforts?




It makes sense that a company should appoint a person to be in charge of implementing Privacy Policy and safeguard Data Security. This in-house arrangement should be subject to constant monitoring by FTC to ensure promises made to consumers are kept at all times.

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