Did The White House Just Thread The Needle On Privacy?

An Awkward Dance, For Sure, But One That Seems to Be Working

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Data-Driven Marketing: I'm too complicated for you. I don't think we work well together. Already it feels like you're all over me.

Administration: Maybe I came on a little strong. But give me some time. I think we can be friends.

That's the backdrop for the recent White House announcement and report on "Consumer Data Privacy In A Networked World." So what to make of this new two-step in the ongoing dance between government and industry over how to regulate the burgeoning data economy in the U.S.?

As with anything coming out of D.C., we should start with the political angle. And this should play as good politics. First off, heading into a re-election campaign, who's not in favor of consumer privacy? While not rising to puppy-dog and apple-pie status, the idea of digital privacy appeals to the average voter, so delivering this report through a more forceful White House announcement and brand enables the President to add it to the litany of issues he took on in his first term.

The White House also handled the legislative angle with skill. In the context of the eight (by my count) different pieces of privacy legislation currently pending in Congress (which appear to be going nowhere), the White House report calls for its "Consumer Bill of Rights" to be passed into law. At the same time, it gives equal billing to a parallel effort to reflect that Bill of Rights in a self-regulatory code of conduct. Emphasizing this dual track, the White House included the industry umbrella group, the Digital Advertising Alliance, of which Lotame is a member, in the White House event and trumpeted an agreement reached with the DAA to require its members to honor Do-Not-Track headers.

The announcement offered something for everyone. It enables industry to promote the self-regulation and the positive role played by the DAA. It promises privacy advocates a push for legislation and further talk about strengthened enforcement. It gives the FTC credit for paving the way toward an agreement on Do-Not-Track. And it leaves the Department of Commerce as the central player shaping the administration's approach.

Those are the optics. How's the substance? On first pass, the report carries over many of the positive aspects of the initial Department of Commerce Green Paper. For starters, the recommended frameworks are principle-based; it prescribes no soon-to-be-obsolete technical standards or tools. Given the constantly changing landscape of technologies, business models, business and consumer practices and consumer expectations, that 's a wise course. In addition, the report devotes quite a bit of airtime to the goal of increasing global interoperability. (Good luck on that one, but at least the report recognizes how difficult it will be for digital businesses to understand and meet compliance standards outside the U.S.) The report also recognizes the nuances involved in implementing the major concepts of the Bill of Rights (for example, the fact that consumers need to take responsibility for evaluating and exercising their choices).

Beyond that , the report largely validates the current state of play. For example, we already have multi-stakeholder processes yielding enforceable codes of conduct – most notably, the DAA's self-regulatory principles for Online Behavioral Advertising and Multi-Site Data — and these existing codes reflect many of the principles underlying the Bill of Rights. As for another policy prong – strengthening the FTC's enforcement authority to prohibit unfair and deceptive acts or practices – the FTC already has that authority, and exercises it actively. Even the industry's agreement to honor Do-Not-Track headers simply formalizes what the most progressive companies have been doing for months. Or, as Direct Marketing Association CEO Larry Kimmel put it, "We're delighted that the Administration agrees that our industry's Self-Regulatory program should continue to be the standard of consumer protection and the free, advertising-supported internet."

More to tell as we get past "flash analysis" to "fine-tooth-comb" review of the 50 page report. But one thing we know for sure: with the fallout from the White House report, and the next FTC report scheduled to arrive soon, the dance will continue. Hopefully industry's legs will be fresh enough to keep up with all of the twists and turns, so the Internet can continue to be the "engine of innovation, business growth, and job creation" acknowledged in the White House's announcement.

Adam Lehman , a registered Independent, is COO and General Manager at Lotame.
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