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Online Privacy: Can Europe Force American Companies to Change?

Sep 12, 2012 Jennifer Williamson, Distance Columnist | 0 Comments

It’s possible. Europe is considering a new data protection law from the European Commission that would bar companies from gathering consumer data without their explicit consent, force them to delete the data permanently if the consumer requests it, and pay fines if they don’t comply. It’s a much tougher consumer protection strategy than is required in America—and it could have a strong impact on companies such as Facebook,, and others.

Currently, every country in Europe has different laws that govern consumer data protection. The new law would apply across all countries in the European Union, simplifying compliance for online companies in both Europe and the United States. 

The current laws governing online privacy in the US vary by state—but they are much more permissive. Often companies present their privacy policies online to customers, although these are often long, dense, and difficult to read and understand. Customers can opt out of having their data collected in some cases, but that may bar them from using
the site entirely. And if you give personal or online college data
to a website like Facebook, the site can keep your photos and
information indefinitely—even if you close your account. In
general, American firms support self-regulation instead of
strong government laws governing how they collect consumer
data—and what they do with it. 

Online Privacy

f European privacy controls become the standard, it’s possible other companies throughout the world—including those in the US—will have to invest in honoring those standards.

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It’s possible that if the law goes through in Europe, it could have an effect on how American companies collect and store data, too. In fact, it already has. The Obama Administration is currently considering the details of new “Do Not Track” legislation that allows people to protect their data online—and American companies are willing to negotiate partially because of pressure from Europe.

Do Not Track, in essence, already exists. It’s technology that lets users opt out of having their data collected at websites they visit. It can be enabled on a browser and is supposed to function like the Do Not Call registry, preventing any company from tracking the data of a user with the technology enabled. At the moment, honoring the Do Not Track software is voluntary and not widely accepted by companies. The Obama Administration is considering legislation that will force companies to honor Do Not Track, but it is doing so in negotiation with American companies. 

One criticism companies have of the new policies is that they could make it difficult for free content to be provided online. Currently, the free-content online business model relies on data tracking and data-driven advertising to pay the costs of providing free content. Some companies warn that if online privacy laws are tightened, they may no longer be able to provide free content online.

Whether new online privacy laws would have a debilitating effect on current free-content business models—or whether they would tangibly affect American consumers, remains to be seen. At the moment, however, it’s fairly clear that the difference between American and European approaches to online privacy is that America seeks to protect company freedom and interests—while Europe’s priority is to protect web users over the interests of companies.

If European privacy controls become the standard, it’s possible other companies throughout the world—including those in the US—will have to invest in honoring those standards. It could be expensive for the companies, but it’s possible the new privacy standards would be better for consumers.


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