April 1997 Fear of Prying Still Hinders E-Comm

A recent study conducted by eTRUST (Palo Alto, Calif.; .http://www.eTRUST.org) reveals that privacy of personal information on the Internet is a consistent, significant concern for consumers, greatly limiting their commercial Internet activity and impeding growth of electronic commerce. According to the study, over 70% of those surveyed are more concerned about privacy on the Internet than they are about information transmitted by traditional media such as phone and mail.

Consumers' mistrust often leads them to either refuse to provide information on the Internet or to give inaccurate information. Over 41% of respondents say they leave Web sites when asked to provide registration information on the Internet. Another 27% provide false personal information on Web site registration forms.

"The study reveals that almost three in five consumers do not trust Web merchants with their personal information," said Lori Fena, executive director of the Electronic Frontier Foundation (http://www.eff.org), a civil liberties organization. "They need assurance that this information will be treated responsibly. Internet companies can provide this assurance by telling consumers exactly how and with whom their information will be shared."

The survey data also indicates that disclosure practices would raise consumers' comfort level in providing information.

"If infringements of consumer privacy on the Internet continue to proliferate, the industry will undoubtedly face the threat of government regulation," said Susan Scott, executive director of eTRUST. [Some critics already feel threatened by the long arm of the law; see " Governments Should Respect Rights to Privacy" on p. iv.] "The solution to the problem of consumer trust is informed consent &emdash; telling the consumer how their information will be used, and obtaining their consent before using it," Scott added.

To that end, eTRUSTwas founded to increase the level of trust between merchants and consumers in electronic commerce transactions. Sponsored by the EFF and CommerceNet (http://www.commerce.net), an Internet industry association, the eTRUST program includes:

• A system of logos that represent the Web site's information privacy policy for consumers' personal information, and alert consumers to how the information they reveal online will be used.
• A scaleable assurance and monitoring process involving self-assessment, community monitoring, and professional third-party auditing to ensure compliance with guidelines.
• An awareness and education program for consumers and vendors.