The Download - February 2012

Edited by Stuart P. Ingis and Michael A. Signorelli

INDUSTRY DEVELOPMENTS

DAA Launches a Consumer Education Campaign

In January 2012, the Digital Advertising Alliance ("DAA") launched an education campaign to inform consumers about interest-based advertising and how to take greater control of their online privacy. The DAA is a coalition of the nation's leading media and marketing trade associations, including the Association of National Advertisers, the American Advertising Federation, the American Association of Advertising Agencies, the Direct Marketing Association, the Interactive Advertising Bureau, and the Network Advertising Initiative. The DAA administers a self-regulatory program that calls for entities engaged in online behavioral advertising to provide enhanced transparency via the Advertising Option Icon and consumer control.

The campaign, known as "Your AdChoices," was created pro bono by the Salt Lake City office of MRM, a member of McCann Worldgroup. The campaign builds upon the DAA's two-and-ahalf year effort to develop and implement cross-industry best practices and effective solutions for providing notice and choice with respect to collection and use of data through its Advertising Option Icon (see image below).

The campaign includes banner advertising that links to an information website, www.youradchoices.com, which features three educational videos and a user-friendly consumer choice mechanism. The consumer choice page enables consumers to opt out of interest-based advertising from the companies that participate in the DAA's Self-Regulatory Program. Companies that participate in the Program are donating ad inventory space to deliver the banner ads to consumers across the Internet. DAA expects to deliver hundreds of millions of ad impressions in 2012.

HEARD ON THE HILL

House Energy & Commerce Subcommittee Identifies Legislative Priorities for 2012

Rep. Bono Mack (R-CA), Chairman of the Commerce, Manufacturing, and Trade Subcommittee of the House Energy and Commerce Committee, recently identified her priorities for the Subcommittee for 2012. She said the Subcommittee will continue to examine Internet privacy issues and to evaluate whether legislation is necessary. In 2011, the Subcommittee held several hearings on consumer privacy and data security. Chairman Bono Mack is expected to continue to press to move the SAFE Data Act – a data breach notification bill she introduced last year.

Other priorities for the Subcommittee include stimulating manufacturing in the United States, creating new jobs, and spurring innovation. The Subcommittee will also focus on streamlining the U.S. government's federal agencies and regulatory codes. The Subcommittee will explore ways to eliminate unnecessary regulation to foster a business friendly environment.

Rep. Markey Releases Draft Mobile Device Privacy Bill

In the wake of questions about software developed by CarrierIQ, Congressman Ed Markey (D-MA) has prepared a draft "Mobile Device Privacy Act." As drafted, the legislation would task the Federal Trade Commission ("FTC") with setting a host of regulations on "monitoring software" for mobile phones.

The bill defines "monitoring software" broadly, as software that "has the capability automatically to monitor the usage of a mobile telephone or the location of the user and to transmit the information collected to another device or system, whether or not such capability is the primary function of the software or the purpose for which the software is marketed." The bill would apply even if the software is not activated or used. However, information transmitted from a phone to that phone's commercial mobile or mobile broadband service provider would be excluded.

Within one year, the FTC would be required to promulgate regulations requiring clear and conspicuous disclosures to consumers about "monitoring software" installed on mobile phones. These disclosures would be provided at the time of device sale, service sale, or software installation, and would be provided by phone vendors, service providers, phone manufacturers, operating system providers, or website and online service operators as appropriate.

The FTC would also promulgate regulations requiring such companies (1) to obtain consumers' prior express consent to any data collection or transmission by such software; (2) to establish an information security program for any data received from such software; and (3) to file, with both the FTC and Federal Communications Commission ("FCC"), a copy of any contract for sharing data from such software between companies.

The bill would create a private right of action allowing plaintiffs to seek up to $1,000 in statutory damages for each violation, or treble damages for willful or knowing violations. The new requirements could also be enforced by state authorities, the FTC, and the FCC.

Senate Subcommittee Holds Hearing on Video Privacy

The Senate Judiciary Committee's Subcommittee on Technology, Privacy and the Law held a hearing on "The Video Privacy Protection Act: Protecting Viewer Privacy in the 21st Century" on January 31, 2012. The hearing follows House passage of H.R. 2471, which would amend the Video Privacy Protection Act ("VPPA"). The VPPA generally prohibits the disclosure of certain customer records by a "video tape service provider." Under the House legislation, the VPPA would allow consumer consent to the disclosure of video rental records to be obtained online in advance of the disclosure, either for a set period of time or until the consent is withdrawn...