The News – 09/10/01

In this Issue:

The Right to Privacy?

Recently, in a discussion group I participate in, someone asked, “What happened to our right to privacy?” He was appalled at a recent judicial decision that, he claimed, stated “that phone calls you place and take in your own home cannot be considered private.”

While I certainly agree with the sentiment, I must point out that there’s nothing in the Constitution that guarantees privacy. The 4th Amendment guarantees citizens’ security of “persons, houses, papers, and effects, against unreasonable searches and seizures,” but doesn’t guarantee privacy. In fact, the word doesn’t appear anywhere in the Constitution or the amendments.

There are some laws on the books regarding privacy, however, but most only concern the federal government. In 1998 the White House issued a memorandum on Privacy and Personal Information in Federal Records, saying: “Privacy is a cherished American value, closely linked to our concepts of personal freedom and well-being. At the same time, fundamental principles such as those underlying the First Amendment, perhaps the most important hallmark of American democracy, protect the free flow of information in our society.” The memorandum directs Federal agency heads to “assure that their use of new information technologies sustain, and do not erode, the protections provided in all statutes relating to agency use, collection, and disclosure of personal information,” and that they follow the Privacy Act of 1974. One wonders why it was necessary to direct government agencies to obey the law!

There is one bill, the Gramm-Leach-Bliley Act , enacted in late 1999 with a compliance date of July of this year, that does regulate what financial institutions can do with non-public information about you. It’s because of this law that you’ve been receiving the privacy policies of the various financial institutions in your life. These institutions must, “Provide an opt-out notice, with the initial notice or separately, prior to a financial institution sharing nonpublic personal information with nonaffiliated third parties.” So now’s your chance to opt out.

Also this year, the privacy provisions of the Health Insurance Portability and Accountability Act of 1996 became effective, with a compliance date of April 14, 2003. The original 1996 law gave Congress until August 21, 1999, to pass comprehensive health privacy legislation. When Congress did not enact such legislation after three years, the law required the Department of Health and Human Services (HHS) to craft such protections by regulation. The regulations basically protect your health information from being disclosed without your consent. However, since medical establishments share information all the time in the process of caring for you, this gets a bit sticky. The rules are expected to cost $17.6 billion over 10 years to implement, while generating significant offsetting savings.

Despite some recent advances, and despite the cherished nature of privacy, there are few rules is binding on non-financial or non-health institutions. Private citizens really have no right to privacy in other arenas. Sure there’s a lot of talk about privacy, and about the EU privacy rules, but, as you can see from Congress’ HIPAA foot dragging, our government really has little interest in proactively enacting laws to protect our privacy from non-governmental entities. The FTC has created the elements of fair information practices (notice, choice, access, security, and contact), but there’s no enforcement mechanism. There’s a lot of interest in trading in online information (failed dot-coms trying to sell client lists), but these challenges tend to stand on the concept of the contractual nature of a site’s voluntary privacy policy.

Sun CEO Scott McNealy said a couple of years ago, “You have no privacy. Get over it.” Is this our fate? Must we stand by while private companies amass tremendous databases of information (don’t get me started on Microsoft’s Passport!) on us? Or should we make our elected representatives aware that we’d just as soon keep our private matters private? Will it take being turned down for a job because you have a genetic predisposition to cancer to bring the point home? And while we’re at it, as marketers, what is our responsibility to refrain from infringing on privacy? We need answers to these questions soon, IMHO. I’m interested in your thoughts on these matters. Send them in and I’ll publish them in a future SNS.

Privacy Backgrounder

Briefly Noted

• Shameless Self-Promotion Dept.: I’ve added some functionality to the Marketing section of the StratVantage Web site. Among other things, you can now track airline flights. I’m planning on making this page a dumping ground, er, demonstration area for the best (and some of the worst) of the online marketing techniques around. After all, any traffic to your Web site is good traffic, right? Wrong, spam-breath! If you have a hosting company that throttles your Web site if you have too many visitors (like I do), you don’t need lots of lookie-Lou’s. And speaking of Web site throttling, my hosting company has finally admitted that they’ve been turning away users of the StratVantage Web site erroneously, due to a bug in their traffic monitoring software. Consequently, they’re moving the site to their new UNIX servers, and that will solve the problem (yeah it will!). So if you can’t get to my site over the weekend or early next week, that’s what’s happening.
  StratVantage Marketing
• Web Site Liability: Alert SNS Reader Andrew Hargreave sends along this item: According to Margaret Jane Radin, director of Stanford’s Program on Law, Science and Technology, the owners of a hacked Web site could be liable for whatever problems arise from the malfunction or downtime of the site. Radin concludes that “there is a ‘significant risk’ that in the near future targeted Web sites will be held liable to their customers for harm arising from distributed denial-of-service attacks.” Since most Web hosters have some sort of Service Level Agreement (SLA), make sure they don’t wiggle out of their share of responsibility for downtime.
  NWFusion
• Get ‘Em While They’re Young: The state of Arizona is planning on delivering more than 7,000 software titles to 850,000 students in all 1,200 of its schools statewide using an Application Service Provider (ASP) approach. Access to the applications will cost $8.16 per student per year. The ASP deal involves an unprecedented agreement concerning the use of Microsoft Office: Students can use the both in school and at home on a round-the-clock basis. “Typically, if you want to use [Office] in two places, they want to charge you for that privilege,” according to Gartner analyst Neil MacDonald. As great an idea as this is, it will be difficult to run applications like Excel or Word over 56Kbps dialup connections. Enter Cox Business Services, which plans to push high-speed cable modem service to the home to provide students with the required bandwidth. Alert SNS Reader Andrew Hargreave also sent this item.
  ComputerWorld
• A Sneaky Way to Increase Wireless Revenue: Australian telecom Telstra sent voice messages to millions of its mobile phone customers promoting a new service. Innovative marketing, you say? Well, perhaps, but the company charged its customers to retrieve the message. Any time you can get your customers to pay for your marketing efforts, that’s a good thing, right? Wrong again, direct marketing breath! This sort of thing is not unprecedented, however, as many dialup Internet users have to pay to receive spam email, a fact that has spawned many different bills in Congress aiming to clean up spam. I guess our representatives better worry about voice spam as well.
  Australian Broadcasting Corporation
• Signs You Live in the Year 2001: Here’s a bit of a giggle. I particularly like reason number 11: “Leaving the house without your cell phone, which you didn’t have the first 20 or 30 years of your life, is cause for panic and turning around to go get it.” I’ve been there.
  Big Muddy
• New Times, New Art: I don’t know if the Surveillance Camera Players are still a going concern, but I just love the concept: a troupe of players who put on little dramas in front of surveillance cameras. Talk about narrowcasting! This is performance art at its finest. Unfortunately, all the links to movies of their performances, such as Samuel Beckett’s Waiting for Godot, performed at the Astor Place subway station, Manhattan, don’t appear to work. But their Web site was updated at the end of August, so perhaps we can hope that the troupe is still out there keeping it real.NotBored
• Loudcloud Makin’ Some Noise: Qwest Communications and Loudcloud inked a five year preferred partner deal to co-market and sell each other’s services. Loudcloud will host in Qwest CyberCenters and use Qwest’s network. Qwest expects the alliance to generate about $260 million of service sales during the next five years. As I have said in the past , I don’t think telecoms will succeed in the ASP space without a lot of help. Despite their considerable potential and many relevant capabilities, telecoms lack several key assets, like customer service and an understanding of business applications other than voice. Qwest is one of the most clueful Baby Bells, having been an entrepreneurial long distance competitor before taking the baffling step of acquiring one of the most clueless RBOCs, USWest. Loudcloud makes a good match, and I think they’re feeling the heat of sky-high expectations (founded by Marc Andreesen) and diminished accomplishments (after debuting at $6, Loudcloud is now trading under two bucks). It remains to be seen whether this alliance will succeed, but it looks like a smooth move for Qwest.
  InternetWeek
• VoiceXML 2 held up for intellectual property issues: The more than 500 Voice XML Forum members need to work out some way to cross license the technology. The forum was started by AT&T, IBM, Lucent and Motorola two and a half years ago to create a common specification for writing applications that respond to voice control.
  InfoWorld
• Report from Burning Man: Alert SNS Reader Andy Stevko took the plunge and visited the Burning Man festival, a bustling temporary city of some 25,000+ people in the middle of the Black Rock Desert in Nevada that has become the techies’ pilgrimage/Disneyland/end of summer bacchanal. Just like the bikers return to Sturgis each year, so do techies, artists, and fellow travelers return to the stinking alkali desert to be “part of an experimental community, which challenges its members to express themselves and rely on themselves to a degree that is not normally encountered in one’s day-to-day life.” The result is temporarily Black Rock City, home to the Burning Man event. Frankly, the experience can’t really be described, although Bruce Sterling took a great stab at it, but Andy’s got pictures, at the link below.
  Hotu-Matua

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