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Tuesday
- May 23, 2000
Dot Com Distress
According to ABC News:
"Silicon Valley is famous
as the place where new millionaires are made every day,
where people pay astronomical sums for what are ordinary
homes and where work often resembles play.
But this valley of dreams may
be undergoing wrenching and permanent change.
'The old I've got a dot-com
business plan and anybody would put money into it is probably
permanently over,' says Joe Shoendorf of Accel.
Even before the big stock sell-off
that saw so many of Wall Street's Internet high-flyers
come crashing down, many dot-com companies were already
feeling the pinch from tighter government accounting rules
and investor impatience with lack of profits..."
Click
here for the full story [Link no longer active] including
why many are returning to their old jobs.
FTC Asks for Further Internet Regulation Rights
On Monday, the Federal Trade Commission asked congress
to grant it more power to regulate the way personal
information can be used that is collected on Websites.
According to the Associated
Press, "The commission recommended that lawmakers
pass legislation to bolster its ability to oversee online
privacy, concluding that the industry has failed to safeguard
consumer privacy through self-regulation."
And according to the New York
Times, "The nation's consumer protection agency is
likely to encounter skepticism from key Republicans and
from industry groups about the government's ability to
impose regulations without stifling the innovation fueling
the new economy."
Online Privacy Legislation
Will Break In Two Separate Waves
The battle over Internet privacy will play out in two
rounds of legislation -- one in 2001 and another in 2005.
According to the new Report "The Internet's Privacy
Migraine" from Forrester Research, Inc, this process
will take place in three stages: An initial round of legislation
focused on Web sites will be passed in 2001; the issue will
go into remission from 2002 to 2004; a second, broader round
of legislation will be passed in 2005.
"Rising consumer concern,
technological advances, and business pressures will make
privacy one of the hottest areas of Internet policy debate
in the next several years," said Jay Stanley, analyst
at Forrester. "The combination of consumers' feelings
of irritation and violation, combined with the findings
of this week's FTC report and the politics of an election
year will put the privacy issue at center stage."
After an excruciating series
of fights and compromises, Forrester believes that the
first set of legislation will come later next year. The
legislation will require Web sites to provide notice of
their information practices -- with the FTC retaining authority
to take action against those who do not abide by their
own policies. It will also require consent for the sharing
of data, but that provision is complex, full of large exceptions,
and vague in key areas such as the definition of "third
party." Industry lobbying will successfully defeat
measures that require companies to provide consumers with
access to information that has been collected about them.
After quieting down in the wake
of the initial legislation, the privacy issue returns to
center stage in 2004 as a result of three factors. First,
businesses under continuing relentless competitive pressure
will increase the power and scope of their information-handling
abilities. Second, the privacy issue will spill outward
from Web sites to offline data collection as the aggregation
of data by marketers and personal information brokers becomes
more aggressive. Third, antigovernment conservatives will
join anticorporate liberals on the privacy bandwagon, injecting
new political life into the privacy issue.
Momentum for a new privacy bill
will finally crest in late 2005. Congress will pass sweeping
legislation establishing unified privacy principles that
apply to the Internet, financial institutions, and medical
providers. This legislation will also pre-empt state privacy
laws. The measure requires genuine opt-in for the sharing
of personal information with third parties, including any
business partners and affiliates, consumer access to basic
factual data being held by an institution, and severe restrictions
on data aggregators akin to those contained in the Fair
Credit Reporting Act.
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