The government should rely on private industry to protect the privacy of consumers who use the Internet, business leaders told the Federal Trade Commission Wednesday.
"We should give self-regulation an opportunity to work," said William M. Randle, senior vice president at Huntington Bancshares and a member of the advisory group to the Banking Industry Technology Secretariat.
"Industries like banks have their customer interests at heart as part of their livelihood," he said. "Because it is key to our industry, we will protect privacy more aggressively and tenaciously than the government."
A study released Tuesday by the think tank Privacy and American Business, however, raises new doubts about whether the public will trust corporate America to keep data confidential.
The survey of 1,009 computer users found that 58% wanted the government immediately to regulate how information is collected and used on the Internet and 24% wanted the government to recommend privacy standards to industry. Only 15% said the government should allow industry to develop voluntary privacy standards.
The study, which was presented at the FTC hearing, found that computer users who are not active on-line are the strongest proponents of government regulation; those described as heavy Internet users were least likely to call for new laws.
"The call for government to pass laws is clearly prompted by the findings that on-line and Net users do not see companies or their on-line services telling them how they will collect and use personal information," said Alan F. Westin, a Columbia University professor who helped organize the study.
Industry leaders tried to persuade the FTC that corporate initiatives would protect consumers.
H. Robert Wientzen, president of the Direct Marketing Association, said his group has published guidelines instructing companies not to use data collected on the Web without the consumer's consent.
"Self-regulation will allow on-line communication to reach its potential," Mr. Wientzen said. "This isn't a matter of altruism. The reason this makes sense is because without the consent of consumers we are not going to create a new system of on-line commerce."
Esther Dyson, chairman of Trust e Corp., unveiled a product to help consumers learn how companies will use data supplied to Web sites. Companies that complete a certification program will be allowed to display one of three logos. The first logo signifies that the site does not collect any data from consumers; the second indicates that the company collects data for its own uses; and the third warns that the company shares consumer data with other corporations.
