FTC hopeful on Web self-regulation

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The Federal Trade Commission will hold off issuing new demands for regulations covering privacy and children's content on the Internet, and instead give new industry initiatives more time to take effect, Chairman Robert Pitofsky said last week.

Mr. Pitofsky said the self-regulation efforts demonstrated at June FTC hearings warrant his agency going slowly on recommending new regulations or laws.

"There has been so much progress," he said, noting changes since the FTC held a hearing a year ago into some of the privacy and children's issues.

An FTC report on the June hearing due out at month's end will likely discuss areas of concern but it will, for the moment at least, apparently await industry efforts.

INDUSTRY EFFORTS CONTINUE

Those industry efforts continued last week, with one coming from the Children's Advertising Review Unit of the National Advertising Division of the Council of Better Business Bureaus.

CARU said it has contacted more than half of major marketers cited by the Center for Media Education as collecting data from children at their Web sites, and all but one are halting the practice.

An FTC decision to give the industry more time to act would put the agency in agreement with a Clinton administration position paper on how the U.S. should best deal with the Internet to assure the Web's future as a generator of commerce. President Clinton and Vice President Al Gore personally unveiled the "Framework for Global Electronic Commerce" position paper last week.

Prepared by Ira Magaziner, senior adviser to the president for policy development, the paper tries to offer a comprehensive U.S. policy for negotiating with other governments on Internet issues--for instance, opposing Internet-only taxes or content restrictions; urging that copyright issues be examined; and recommending treaties be signed that would guarantee the Internet's future.

Two of the issues the paper examined were some of the same privacy rights and children's content issues the FTC faced.

PROTECTING KIDS

The paper says children who lack the ability to recognize privacy concerns need to be protected, but urges industry and consumer groups to use technology, self-regulation and education.

"This problem warrants prompt attention. Otherwise, government action may be required," it says of the privacy issues, while urging adoption of ratings systems and filtering technologies for content issues.

The stance somewhat surprised ad groups that had expected the Clinton administration to push a more regulatory approach.

"We are pleasantly surprised," said Hal Shoup, exec VP of the American Association of Advertising Agencies.

SUPPORT FROM MARKEY

U.S. Rep. Ed Markey (D., Mass.), an administration stalwart who has offered his own legislation to regulate unsolicited commercial e-mail and several other issues, expressed strong support for the administration. The congressman, however, said he would not withdraw his legislation.

FTC Commissioner Christine Varney said she would still like to see the FTC report call for greater action on children.

"The industry has dealt with the needs of adults," she said, "but what should be for kids is what our report will speak to in the end of July."

Copyright July 1997, Crain Communications Inc.

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