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Microsoft calls for broad privacy law

Posted by iNext - 2005-11-06

Microsoft Corp. on Thursday called for a broad national law to protect consumer privacy and a top Republican lawmaker said he planned to push such a bill next year, amid heightened consumer concerns about identity theft and online fraud.
"This is the time, this is the place, we believe, for the government to adopt privacy legislation on a national basis," Microsoft General Counsel Brad Smith said at a lunch event.

Texas Republican Rep. Joe Barton, who chairs the House Energy and Commerce Committee, said at a separate event that he plans to introduce a comprehensive privacy bill next year.

High-tech businesses, including Microsoft, helped block attempts to pass a national privacy law in 2001 and 2002, arguing that businesses can be trusted to handle consumer profiles responsibly.

Since then, most Fortune 500 companies have developed "privacy policies" that spell out, often in dense legalese, what they do with credit-card numbers, birthdates and other information consumers give to them.

Congress, meanwhile, has tackled a number of privacy issues, from "spam" e-mail to telemarketing to computer "spyware." Lawmakers are currently wrangling over legislation that would require businesses to let consumers know when their account information has been exposed to outsiders.

Still, several polls have found that privacy concerns have prompted some consumers to cut back on online purchases, and a rash of data breaches has exposed sloppy security practices at banks, universities and a wide range of other institutions.

Smith said a broad privacy law spelling out how businesses handle consumer information is now needed to shore up consumer confidence and simplify a legal landscape that is becoming cluttered by conflicting state and national laws.

"It's the patchwork of state laws that is causing a lot of heartburn, not any one individual law," he said.

Any legislation should allow consumers to limit how information about them is used and should apply to online and offline businesses equally, Smith said.

Online retailer eBay Inc. is also pushing for a national privacy law, a lobbyist for the company said, while computer maker Hewlett-Packard Co. has backed such a law for years.

A prominent civil liberties advocate said Smith's speech was a significant development.

"This creates some momentum for really addressing privacy legislation as early as next year," said Jerry Berman, president of the Center for Democracy and Technology.

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