The Electronic Catalog: FTC Examines Wireless Web Privacy Issues

Mobile, or wireless, commerce could be the wave of the future. So does that mean it’s time to regulate?

Just when you thought you had e-commerce nailed down, along comes another tech challenge. M-commerce — mobile, or wireless, commerce — is gradually making its debut, and many catalogers are scrambling to get their sites wireless enabled. (See “Wide Wireless World” in the December 2000 issue of I.Merchant.)

Some Websites, such as search engine Yahoo! and book seller Amazon.com, have already rolled out their wireless initiatives, which give their wireless subscribers the ability to shop, check e-mail, and scan the news from mobile devices such as cellular phones and portable digital assistants (PDAs). But these companies are not alone in their efforts to stay on top of the wireless game. The Feds have already jumped on the wireless bandwagon — sort of.

The U.S. Federal Trade Commission held an “information gathering” workshop on Dec. 11 and 12 in Washington to examine consumer protection and security issues relevant to the emerging wireless Web. But so far, no formal privacy regulations have been developed or agreed upon, says Ellen Finn, an attorney in the Bureau of Consumer Protection.

“I certainly don’t see anything regulatory on the horizon right now,” Finn says. “The goal of the workshop was to educate ourselves about emerging wireless technologies and privacy issues surrounding them.” Items on the agenda for the workshop included an overview of the wireless market in the U.S. and in Europe, wireless advertising, and self-regulatory initiatives.

A cross-section of industry executives, analysts, and privacy advocates served as panelists for the workshop. Among the panelists were Jerry Cerasale, senior vice president of government affairs for the Direct Marketing Association; Bob Lewin, president/CEO of TRUSTe, a Web privacy program; Jack McArtney, director of messaging for Verizon Wireless; and Walter S. Mossberg, author of the weekly “Personal Technology” column in The Wall Street Journal.

Though no privacy or security initiatives were drawn up, Finn says a hot topic of the workshop was location information, or the ability of wireless technologies to determine the exact physical location of a person. Location-specific advertising could enable a retailer to send a message to a customer once he was within walking distance of the marketer’s stores to entice him inside. “Location information is unique to wireless, and people are concerned how that information is generated and who has access to it,” Finn says. “At the same time, there is an emerging consensus that use of location information should be on an opt-in basis.”

While Finn says this workshop was a one-time event, it seems likely that there will be future meetings, given the Fed’s watchful eye on wireless security and privacy issues. “The technology and the industry are still evolving at this point, so it’s a matter of watching and waiting to see how things develop,” Finn says. “The marketplace is too much in its infancy for us to know what we’re going to do. This workshop is the very first step to make ourselves aware of the issues surrounding wireless.”

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