Caught between a rock and a hard place: How do you make online privacy policies stick?

By Sean M. Dugan, InfoWorld |  Business

Net Prophet

ARE PRIVACY POLICIES worth the bits they're printed with? Online privacy policies are inherently mutable things: Changes in management, company direction, or ownership can mean that what's the rule today is just a memory tomorrow. This enrages privacy advocates and befuddles consumers. So maybe it's time to draw up some privacy policies with teeth.

Privacy is a perennial sore spot with consumers. Until we live in a transparent society where the word "privacy" is as anachronistic as "horseless carriage,"consumers will have mixed feelings about data gathering. It's a fundamental law of Internet commerce that privacy and convenience are at loggerheads: To gain one, you must sacrifice the other.

E-commerce companies find themselves in a bind. E-commerce is plagued by complaints of a cold, nonpersonal experience. Where's the love? But a company can't very well give you a personalized experience without knowing something about you.

Hence the privacy policy, which is the company's promise to only gather data about you in the interest of serving you better -- never to sell as marketing or demographic data.

But the privacy policy is more of a playground "spit and shake on it" kind of promise, not a binding document. In the real world, policies change. A privacy policy is a snapshot of a moment in time, reflecting the management philosophies of that particular moment. And if we know one thing, it's that things change in e-business.

Take two recent examples. When Toysmart went belly-up, there was a fire sale on its assets. One of those assets was the data it had about its customers. That data went on the auction block along with the rest of the company, which caused a great hue and cry from outraged privacy advocates. The Federal Trade Commission started making unwanted advances and now Toysmart and Disney -- Toysmart's parent company -- are trying to make nice.

Then you may have received the e-mail from Amazon.com saying they were amending their privacy policy. The previous policy basically promised the world, and the new one basically says, "Hey, things might happen." Again, privacy advocates are up in arms, calling for yet another Amazon boycott. There's an irony here: The new policy more explicitly spells out Amazon's policy -- a good thing for consumers. But the fact that Amazon changed the policy and admitted that data might be sold upsets people for some reason.

But it does raise the question of how consumers can make an educated decision on data gathering if the rules of the game themselves are a moving target. It's like learning to play soccer and showing up on the field only to discover it's suddenly all right to tackle players. Actually, it's more like being in the middle of the soccer game when the tackling starts.

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