It Project Manager

Introduction

This study examines several Internet policies and whether the communication of these policies to the user or customer of the service provided by a company providing a service or merchandise has significantly changed during a three-year period between 1999 and 2001. Five characteristics of these Internet policies were studied based on the published policies appearing on the Internet sites of these companies. These examined policies included statements regarding privacy, security, shipping, returns, and warranty. The primary focus of this study was to determine if Internet companies are concerned about providing their customers with the best possible service and at the same time addressing the above issues. One criterion used to measure these parameters was to see if these companies have made significant changes regarding the communications of their company policies during the three-year period of this study.

The use of the Internet is growing rapidly every year, due to the decrease in computer costs and the availability of free Internet access (Lechner and Hummel, 2002). This growth has been accompanied by increase in concerns from privacy advocates, consumers, and legislators regarding the guarantee of privacy on the Internet. Despite the increase in popularity of the Internet, a number of the Internet companies studied had gone out of business or are no longer offering online purchasing. The remaining companies, as well as others that were currently in operation, were studied to determine whether the communication of these policies has significantly increased.

Internet privacy: the current situation

"Basically, right now, there are no legal guarantees of privacy on the Internet. Companies can and may attempt to get away with as much as they can," states Andrew Shen, a policy analyst for the Electronic Privacy Center, based in Washington. "A lot of it is very invisible and a lot of it will pass under the radar of Internet users" (Shadid, 2001). US Senator John F. Kelly, Democrat of Massachusetts, recently mirrored Shen's concerns when he said, "Too many online customers feel insecure about the privacy in the online world. This insecurity is the biggest threat to the new economy" (Stoughton, 2001).

Billions of ads are posted on the Internet today, many of them delivered by the network advertising companies that manage and provide advertising for numerous unrelated Web sites. The three largest, DoubleClick, Engage and 24/7 Media, estimate that more than half of online customers have seen one of their ads, according to an FTC report (FTC, 2000). DoubleClick itself delivered 61 billion ads in one month last year. All three compile data, often by following Internet users from Web site to Web site, to create profiles on consumers. When you visit your favorite Web site, a small text file known as a "cookie" can be placed on your computer, one of dozens probably installed without your knowledge. It acts like a barcode, tracking what pages you visit, which ads you see and how long you see them.

The network advertisers take it a step further. If DoubleClick (http://www. doubleclick.com/us/) runs an ad on CBS SportsLine, it can place a cookie on your computer, then track you as you leave CBS SportsLine to Women's Financial Network, History Channel, Cheap Tickets, or any of the other thousands of Web sites it serves. The tracking comes without ever clicking on an ad. This information is usually anonymous and is the building-block for the profiles that allow advertisers to tailor their message, making advertising more effective (Shadid, 2001). Engage (http://www.engage.com/), for instance, says it has compiled 84 million anonymous profiles with 800 interest categories. DoubleClick has even more and alarmed privacy advocates last year when it proposed linking those files with names and identities compiled by Abacus Direct (http:// www.abacus-direct.com/). Through details on purchases from mail order catalogs, Abacus has built the largest database of consumer information, more than 90 million US households. However, in March of this year, in the face of protests, DoubleClick retreated on its plan, saying it would first wait for the government and industry to reach an agreement on privacy rules for the Internet (Shadid, 2001).

Few people recognize that personal computers can download data to manufacturers or that the cell phone with the built-in global positioning system is a Big Brother, who keeps a constant eye on people. The government appears to have become attuned to the apparent growing concern. The era of unregulated collection of consumer information may be threatened more by legislation than consumer activity (Johnston, 2000).

More than 20 privacy bills were introduced in Congress last year. Although only two passed, it is expected that more will be passed in the future. The two passed were the Health Insurance Portability and Accountability Act, which protects the confidentiality of consumer health care, and the Children's Online Privacy Protection Act of 1998, which bars collection of personal information from children. Legislation is pending that limits email Spam and invasive direct marketing tactics, mandating that companies honor customers' requests to be removed from their mailing lists (Kanner, 2000). The McCain-- Kerry legislation would require sites to give notice when information is collected and provide a mechanism, known as "opting out," so that users can elect not to have their personally identifiable information used for marketing or sold to third parties. The Hollings bill provides more aggressive protection. In addition to notice, it requires that Web sites get the approval of users before collecting or using any such data. In addition, it requires that sites provide consumers access to their information and the ability to correct or amend it.

So far, the Hollings bill has drawn support from privacy advocates. Meanwhile, some industry heavyweights, America Online, Hewlett-Packard, and Walt Disney, have thrown their support behind the McCain-- Kerry proposal, seeing some form of regulation as inevitable. A few parties view increased legislation as a hidden blessing by helping inspire confidence in a market that seems to be stunted by privacy concerns. Forrester Research, in a survey last year, found that, without privacy fears, consumers would have spent $12.4 billion more on e-commerce (Shadid, 2001).

Vendors using the Internet argue that proposed restrictions on how companies collect and use consumer information would not only trigger higher prices for Internet shoppers but also put a damper on the slowing national economy. A report by catalog apparel