DISADVANTAGES — CONSUMER/INTERNET — HURTS BUSINESS� 417

LINK: OPT-IN PLANS

OPT IN PROPOSALS WILL DAMAGE E-COMMERCE

Jeffrey Rosen, associate professor at the George Washington University Law School, The New York Times April 30, 2000, SECTION: Section 6; Page 46; TITLE: The Eroded Self // acs-EE2001

In the hope that the political tide may be turning, Senator Robert Torricelli has introduced a bill that would forbid a Web site from collecting or selling personal data unless users checked a box allowing it to do so. This "opt in" proposal has been vigorously and successfully resisted by the e-commerce lobby, which insists that it would cripple the use of online profiling and cause advertising revenues to plummet.

OPT-IN PROPOSALS WOULD DAMAGE SMALL NEW BUSINESSES AND NON-PROFITS

Solveig Singleton, director of information studies at the Cato Institute, January 22, 1998 Cato Policy Analysis No. 295 PRIVACY AS CENSORSHIP: A Skeptical View of Proposals to Regulate Privacy in the Private Sector http://www.cato.org/pubs/pas/pa-295.html // acs-EE2001

The mandatory opt-in rule would favor larger and older companies at the expense of newer, smaller ones. Established companies could afford more costly lists more easily than could small companies. And established companies would also have less need for lists, since they would have been in business long enough to collect information on their own. The brunt of an opt-in law would thus be borne by small, new businesses or nonprofits struggling to establish a customer base. In one survey, 27 percent of respondents reported making a donation to a charity or a political cause in response to a mailed request.(63) About the same percentage of the population makes purchases through direct mail.(64) While that is not a majority, it constitutes a significant minority--tens of millions of people.

OPT-IN WOULD MAKE IT MORE DIFFICULT FOR VULNERABLE CONSUMERS TO GET WHAT THEY NEED

Solveig Singleton, director of information studies at the Cato Institute, January 22, 1998 Cato Policy Analysis No. 295 PRIVACY AS CENSORSHIP: A Skeptical View of Proposals to Regulate Privacy in the Private Sector http://www.cato.org/pubs/pas/pa-295.html // acs-EE2001

Under mandatory opt-in, firms that could afford to send direct mail would no longer be able to target it effectively. That would lead to fewer, more expensive options for those who shop at home--the elderly, the disabled, rural residents, and anyone without a car--because their mobility is restricted.

MANDATORY OPT-IN PROPOSALS WOULD CRIPPLE BUSINESS EVOLUTION AND INNOVATION

Solveig Singleton, director of information studies at the Cato Institute, January 22, 1998 Cato Policy Analysis No. 295 PRIVACY AS CENSORSHIP: A Skeptical View of Proposals to Regulate Privacy in the Private Sector http://www.cato.org/pubs/pas/pa-295.html // acs-EE2001

In a world without readily available, cheap marketing lists, it is doubtful that another company like Lands' End would ever be born. Mandatory opt-in could preclude, not only the development of new businesses, but the development of whole new business models and product lines designed to serve groups of customers that could never before be identified. Had mandatory opt-in rules been in place a hundred years ago, for example, consumer credit reporting might never have developed.