How can the web industry leverage the incredible potential of online user data while sufficiently protecting peoples’ privacy? The Federal Trade Commission has issued today what it calls a proposed framework for business and policy makers towards that end. Among its recommendations are a proposed feature for every web browser called a “Do Not Track” setting, which would bar outside parties from tracking your browsing activity and offering you personalized ads, among other things.

Thankfully, the document published by the Commission is very thoughtful, evenhanded and places great emphasis on supporting the innovation that is made possible when technology companies do have access to user data. Instead of using scare tactics, as some media outlets have done in recent months, the FTC recognizes that different people have different levels of awareness about activity tracking and different degrees of willingness to trade-off privacy for customization and technology innovation. The Commission wisely recommends empowering users to give informed consent to whatever degree of tracking they are submitted to.

O’Reilly’s Alex Howard has some of the first and best coverage of the news. He has uploaded the framework document to the web and we have embedded it below.

-Below, from the FTC’s Protecting Consumer Privacy in an Era of Rapid Change

Some consumers are troubled by the collection and sharing of their information. Others have no idea that any of this information collection and sharing is taking place. Still others may be aware of this collection and use of their personal information but view it as a worthwhile trade-off for innovative products and services, convenience and personalization. And some consumers – some teens for example- may be aware of the sharing that takes place, but may not appreciate the risks it poses. In addition, consumers’ level of comfort might depend on the context and amount of sharing that is occurring.

The Do Not Track concept is explicitly modeled after the wildly popular Do Not Call registry, a program the FTC implemented in 2003. FTC Commissioner J. Thomas Rosch said in a statement included in today’s recommendations that Do Not Track could include some analytics of its own. “Making access to the Do Not Track mechanism depend upon consumers opting in would not only parallel the Do Not Call model,” he wrote, “it would give the Commission a much more reliable estimate of the percentage of consumers who really wish to prevent this type of tracking.”

What’s at Risk

Consumer web use data is a giant gold mine for economic and technological development that we have just begun to discover the beginning of. Never before in history have so many peoples’ reading, writing, expressions of interest and communication been quantifiably available for analysis and response, in real time. It’s an incredible opportunity that I hope the market will respond to with more than just advertisements. But clearly there are risks and people need to make more informed decisions about how much they expose.

As the FTC recognizes, supposedly anonymous data is rarely impossible to de-anonymize. People have both real and imagined privacy concerns about this data, too.

There is a risk that a campaign to inform people of an option of opting out would be dominated by fear mongers and that the pro-data side will have too little to bring to the table. That would be a big loss for the future, but we would only have our own limited imaginations to blame. Those who looked at data and saw nothing but immediate monetization possibilities and ad targeting put the future of the internet at risk of a major backlash, just like a person who sees every conversation between people as nothing but a sales opportunity probably won’t have many friends.

It’s only fair, though, to give people the choice. Let’s have the discussion about activity tracking data. Ready?

The FTC will host a Twitter chat on this topic today, beginning at noon PST.

FTC Online Privacy Report

marshall kirkpatrick