WASHINGTON-The mobile phone industry is expected shortly to unveil a privacy policy to guide carriers as they reinvent business plans to capitalize on the Internet and new location-based wireless technology.
Michael Altschul, vice president and general counsel of the Cellular Telecommunications Industry Association, said the privacy policy being crafted would be presented to CTIA’s board of directors soon for their endorsement.
“There’s a bunch of legal and policy issues we are struggling with,” said Altschul.
Indeed, the evolution of the Internet as a vehicle for electronic commerce, the convergence of Internet and wireless technologies and the development of location-based wireless technology for emergency and commercial applications have given rise to a plethora of privacy issues that have attracted close attention by Congress, the Federal Trade Commission and privacy advocates.
Location technology presents one such challenge for the wireless industry. While location-based services are touted as an essential component of mobile phone business in the future, it is not at all clear how it will be marketed.
Under the 911 bill enacted into law last year, use of wireless location information is restricted to emergency situations. As such, carriers wanting to offer location-based m-commerce have to seek prior consent from subscribers.
What form prior consent will take is unclear. It could be included in a service agreement, though the industry is moving away from contracts. Altschul said consent could come in the form of a “shrink wrap agreement,” a mechanism employed by computer software vendors.
“There is a baseline legal requirement that consumers must give carriers prior express consent,” said Altschul.
However, Altschul said there are wireless location technologies that can work separately or even in conjunction with mobile-phone networks that do not require prior consent as required by the 911 law.
Rob Hoggarth, senior vice president of government relations for the Personal Communications Industry Association, said the trade group is developing its own set of privacy policies for wireless data devices.
“The key is to promote a level of comfort for users without overbearing government intrusion,” said Hoggarth.
For sure, it is a balancing act for industry and policy-makers. If consumers are not confident that their privacy is protected and that their transactions are not secure, e-commerce will fail to live up to expectations.
At the same time, wireless and dot-come firms-and even government policy-makers-are reluctant to impose regulations that could have the unintended consequence of chilling the development of wireless Internet.
“It’s up to the marketplace because if consumers don’t have confidence, they won’t use the services,” said Hoggarth.
But Congress has signaled it is not willing to leave privacy completely to the marketplace. While no Internet privacy legislation will move in the waning weeks of Congress, lawmakers have teed up the issue for next year.
“We may not all agree abut the specific details of a legislative proposal, but we all agree that the time has come to enact legislation to protect consumers’ privacy,” said Senate Commerce Committee Chairman John McCain (R-Ariz.) at a hearing last Tuesday. “We must move forward through the difficult process of reaching compromise and forging legislation.”
