Opponents of Internet privacy laws claim such regulations are unnecessary and would harm the Internet. As the public grows weary of this pro-business rhetoric, advocacy groups and industry organizations would be wise to embrace a forgotten but more substantial argument. New privacy laws would damage the First Amendment, and this powerful fact could permanently end the privacy regulation crusade.
On the Internet, consumer information is vulnerable if the appropriate precautions are not taken. Many web sites demand that users hand over personal information, such as their name and address, in return for access. In the United States, these sites are then free to use, distribute, or sell this information as they see fit unless they post a privacy policy stating otherwise. Regulation advocates argue this situation is leading to a privacy crisis.
Advocates claim the profit motives contradict privacy interests. If Congress doesn't grant web users the right to access sites without relinquishing information, they say, a privacy crisis will ensue. The technology industry disagrees.
Industry-backed advocacy groups such as the Online Privacy Alliance point out that profit motives actually protect privacy. Online businesses must alleviate privacy concerns or watch customers migrate to competitors. This competitive pressure spurs businesses to safeguard consumer information. These facts are demonstrated by the growing proliferation of privacy policies, which tell web surfers how sites use the information they collect.
A March 1998 study by the Federal Trade Commission found that only 14% of commercial sites posted policies. But a follow-up report last May showed this number had rocketed to 65%. This stunning progress caused the FTC to reverse course and ask Congress to postpone new privacy measures.
Legislators are taking this advice. Substantial Internet privacy laws once appeared inevitable. But now, in response to the FTC's recommendation and the technology industry's lobbying campaign, these regulations have been temporarily shelved.
Impressed with their own success, industry advocates continue to insist that government intervention would stifle self-regulation while imposing harmful costs on the small entrepreneurs driving the Internet boom. It is time to bolster this argument.
To date, the public and many legislators have been sympathetic to a young, evolving Internet industry that deserves to establish itself before regulators intervene. But as the industry gains ground on its astronomical growth forecasts, its key players are already looking more establishment than entrepreneurial. As this change becomes increasingly dramatic, industry leaders will likely confront the hostility that, with a few exceptions, characterizes the public's attitude towards big business.
This doesn't necessarily translate into more support for regulations. But it does mean that pro-business arguments will garner less sympathy, especially in consumer-sensitive areas. This is why regulation opponents should now embrace principled arguments that hold more weight and long-run appeal. The Internet privacy debate provides the perfect opportunity.
First Amendment considerations demand that privacy regulation proposals be abandoned forever. The reason privacy is not generally protected by explicit laws is because the Constitution strikes a delicate balance between privacy and free speech.
Individuals do have a limited right to keep some sensitive information, such as religious beliefs and political associations, private. But this contradicts First Amendment protections of the press's right to publicize truth, even if that truth contains sensitive, private information. Historically, the courts have given this right precedence over privacy interests in an effort to preserve free speech. Internet privacy regulations would begin upsetting this balance.
As many legal scholars have noted, regulations granting individuals new privacy rights against companies infringe on those companies' rights to use, or communicate, the information they collect. If enacted into law, this limitation of commercial speech would set a damaging precedent that could be used as a wedge to enact even broader privacy rights that would necessarily erode the First Amendment. Internet privacy regulations would be the first step down this dark path.
If this fact were etched onto the public eye, privacy regulations would be met with more skepticism, both today and in the long run. Those who doubt the public's patience for such principled debate need only look so far as the encryption battle for evidence. The civil liberties threat posed by encryption regulations has ignited stunning opposition, not only within the Internet community but also among the general public.
Regulation opponents should follow this model. Just as encryption regulations threaten privacy and security, privacy regulations threaten the free speech that Americans cherish. Unless industry groups and advocacy organizations embrace this argument as they brace themselves for the next round of privacy proposals, this threat may become reality.
*Justin Matlick is a Senior Fellow in Information Studies at the Pacific Research Institute. To learn more about PRI and the Center for Freedom and Technology, see www.pacificresearch.org.
