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Privacy questions loom as wireless grows


(IDG) -- For policy makers, wireless e-commerce is emerging as both a devil and a saint: It's capable of delivering very helpful, location-specific information while also building detailed, Big Brother-like profiles of an individual's travel patterns and other habits.

"There are huge, looming privacy issues in the wireless space because of the collection and aggregation of new information," said Alan Davidson, staff counsel at the Center for Democracy and Technology, a privacy advocacy group in Washington.

Over time, location information gathered by businesses could create "a very detailed and invasive dossier of a person's movements," he said.


As wireless is becoming more pervasive, it's ushering in a host of location-based services that could, for instance, let companies send advertisements to people as they approach a store. In that context, if a wireless end user's location isn't available, "your smart device becomes meaningless," said Lawrence Ponemon, a partner at PricewaterhouseCoopers in New York. "You need very significant personalization to have success in the wireless environment."

Those opinions were shared at a workshop held by the Federal Trade Commission (FTC) last week. The FTC is examining the privacy issues in advance of a federal law that will require police, fire departments and other emergency services to have the ability by October to locate people via their wireless handsets.

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The FTC, which has been urging Congress to set privacy standards for online commerce, hasn't taken a position on wireless mobile commerce.

But the incoming Bush administration could have an impact on the FTC's emphasis on regulation. Commission Chairman Robert Pitofsky, whose term is set to expire next fall, is one of three Democrats on the five-member commission. A likely replacement as chairman may be Commissioner Orson Swindle, who, unlike Pitofsky, has generally opposed regulation.

Providers of wireless services are pushing for self-regulation. But unlike the self-imposed standards that are being sought for the wired world, the privacy standards advocated by wireless trade groups such as the Cellular Telecommunications Industry Association in Washington appear to be more rigorous in that they require end users to "opt in" by actively contributing to data collection. The "opt-out" standard -- where users typically uncheck a box on an online form -- is considered a looser standard.

"We seem to be moving toward an agreement in [the wireless] space that the standard should be opt-in," said David Sobel, general counsel of the Electronic Privacy Information Center, a Washington-based privacy group. "I think there's a lot of common ground that has been expressed."

User Consent Needed

Mark MacCarthy, senior vice president of public policy at Foster City, Calif.-based Visa International, said specific user consent will be needed for location finding.

"You're going to have to have some form of opt-in. There is no other way to do it," MacCarthy said.

John Pollard, director of business travel and mobile services at online travel agency Expedia Inc. in Bellevue, Wash., said location-based information helps customers feel as though Expedia is their travel agent.

Every aspect of the service is opt-in, and the product works better with more consumer information, said Pollard. There are a lot of services that people want personalized, and "anonymity doesn't get you there," he said.

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(Network World Fusion)

Federal Trade Commission
Center for Democracy and Technology

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