Evan Schuman's StorefrontBacktalk

On Monday (May 9), a U.S. Senator introduced a bill to limit or prevent E-tailers from capturing information about their customers without asking. Like prior Senate technology efforts, the exemptions to the bill make it unable to execute its core purpose.

Even if the bill—called the Do Not Track Online Act Of 2011 and introduced by Sen. Jay Rockefeller, D-W.Va.—didn’t suffer from those rather generous exemptions, it’s unclear how much of an impact it would have. Its telephone solicitation predecessor is the Do Not Call list. Quick show of hands: How many reading this article have signed up for that list? Of those who did, how many have continued to get lots of phone solicitations, with no practical way to make them stop? ‘Nuff said.

To further minimize worries, as of Wednesday (May 11), the bill had zero cosponsors. As such, it certainly doesn’t look like the Senate will pass the bill anytime soon. Is it possibly a news release bill, one designed to justify a news release but never be actively pursued?

Just in case it does go anywhere, here’s what the bill actually mandates. It wants the Federal Trade Commission (FTC) to create Web regulations dealing with E-tailers. (To be precise, the bill doesn’t directly say that. Its actual wording: the FTC “shall promulgate regulations that establish standards for the implementation of a mechanism by which an individual can simply and easily indicate whether the individual prefers to have personal information collected by providers of online services.” The authors can write a sentence like that and have the gumption to use the phrase “simply and easily”?)

Then the bill adds a Senate-sized loophole. E-tailers can collect and use a consumer’s personal information “notwithstanding the expressed preference of the individual” if the data is, in the opinion of the E-tailer, “necessary to provide a service requested by the individual, including with respect to such service, basic functionality and effectiveness, so long as such information is anonymized or deleted upon the provision of such service.”

Let’s break that down. “Upon the provision of such service.” In short, until you’ve finished providing the service. In an ongoing relationship—say, Amazon and a regular customer—when does that end? Wouldn’t Amazon legitimately argue that the data is necessary to create the type of service customers expect?

From Walmart.com or Target.com’s perspective, knowing who its customers are and their likes/dislikes is absolutely “necessary” to provide a service.

The anonymous part is also problematic. Most E-tailers are perfectly content to not know the name of a customer. It’s a “nice to know,” but the value is associating that person’s actions with that person. “The person who visits us from their IP address and who uses this E-mail address loves the color blue. When they show up, show them lots of blue products.” That’s still anonymous.

So much of the current E-Commerce and M-Commerce worlds are intertwined with the constant collection of all manner of data. Halting the collection is not the answer. No, what the Senate should be doing is requiring the strict protection of that data. Forget PCI. If a chain is found to have been lax in its data protection and a cyberthief breaches the company, let it face federal law violations. That will get any firm’s attention, which is a lot more than this bill is likely to do.

P.S. More proof that Sen. Rockefeller doesn’t seem to be seriously trying to make this bill go anywhere: With the split Senate, any bill’s future depends heavily on courting lots of votes from the other side of the aisle. In the news release touting this bill’s introduction by the Democratic senator, what is the verbatim list of groups cited as it attempted to curry Republican votes? “American Civil Liberties Union, Consumer Federation of America, Consumers Union, Electronic Frontier Foundation, Privacy Rights Clearinghouse, Consumer Watchdog, Consumer Action and the Center for Digital Democracy.” Yeah, that’ll do it.