FTC

As Google continues to struggle to defend its changes to its privacy policies, the company could see the whole controversy shift to a federal court.

The Electronic Privacy Information Center said Wednesday that it planned to ask a federal court to order the Federal Trade Commission to enforce the privacy settlement the agency reached last year with Google. EPIC says Google's privacy changes violate that settlement.

"We haven't yet seen the filing so [we] can't comment on the specifics," Google said in a statement in response to EPIC's court filing. "Protecting people's privacy is something we think about all day across the company, and we welcome discussions about our approach."

Google says the changes will make it easier for users to understand its privacy policies. It also denied a claim EPIC made in its court filing that the company did not obtain users consent before sharing data with third parties. Google maintains that it does not share user data with third parties and that will continue to be the case even after the privacy changes go into effect on March 1.

The Electronic Privacy Information Center Thursday urged the Federal Trade Commission to examine whether Google's new personalized search results violate antitrust laws or a privacy agreement the Internet firm reached with the agency last year.

Google's new "Search plus Your World" service uses information from its social networking service Google + and other data to provide personalized search results. In a blog post Tuesday about the new service, Google said it would make it easier for users to find more personalized information on the Web, "the people you know and things they've shared with you, as well as the people you don't know but might want to... all from one search box."

Already under scrutiny over privacy mistakes it made in the launch of its now-defunct social networking service Buzz, Google said it "set a high bar" in protecting the privacy of the personalized search results, which are not available to others and are encrypted.

But EPIC said the service still raises privacy concerns. A previous FTC complaint filed by the group against Google's Buzz led to a major privacy settlement with the company last year. The agreement required Google to build privacy into its products, establish a comprehensive privacy program and agree to periodic independent privacy audits. At the same time, the FTC is conducting an antitrust probe of Google examining whether it favors its own products in its search results.

EPIC Executive Director Marc Rotenberg said during a conference call that the rollout of the new search service has parallels with the launch of Buzz in that Google is requiring Google + users to opt out of receiving personalize search results. "Although data from a user's Google + contacts is not displayed publicly, Google's changes make the personal data of users more accessible," Rotenberg wrote in a letter Thursday to the FTC.

EPIC also said incorporating results from Google's social networking service into its popular search engine may put competitors at a disadvantage. "Incorporating results from Google + into ordinary search results allows Google to promote its own social network by leveraging its dominance in the search engine market," Rotenberg said.

In a statement, a Google spokesman said the goal of the new service is to provide users with the most relevant information. "Search plus Your World doesn't change who has access to content, it simply helps people rediscover information they already have access to," the spokesman said in a statement. "We've taken special care with our new features to provide robust security protections, transparency and control for our users."

The Senate Commerce Committee says it will vote on nominees to the Federal Communications Commission and Federal Trade Commission on Thursday.

FTC nominees include Rebecca Blank, Jon Leibowitz, and Maureen Ohlhausen. FCC nominees are Jessica Rosenworcel and Ajit Pai.

The session will begin after the first roll call vote on the Senate floor.

The Senate Judiciary Antitrust Subcommittee has scheduled its widely anticipated hearing on Google's business practices, featuring Executive Chairman Eric Schmidt, for Sept. 21.

After initially resisting the subcommittee's request to send Schmidt or CEO Larry Page to appear, Google gave in earlier this month and agreed to allow Schmidt, who stepped down as CEO in April, to testify.

The hearing, titled "The Power of Google: Serving Consumers or Threatening Competition?," will explore concerns that Google is using its dominance in Internet search and online advertising to benefit its own products and services over its competitors. Google revealed last month that the Federal Trade Commission has opened an antitrust probe of the company into these same issues.

The firm has defended its business practices, saying in a blog post at the time that, "We're committed to giving you choices, ensuring that businesses can grow and create jobs, and, ultimately, fostering an Internet that benefits us all."

Federal Trade Commission Chairman Jon Leibowitz said Thursday that wireless operators should require their customers to use a password to access the voicemail on their mobile phones. The problem for Leibowitz, as he was quick to note, is that his agency has no jurisdiction over wireless carriers.

The issue of cell phone security has gained new attention because of the cell phone hacking scandal involving Rupert Murdoch's News Corp. Reporters at some of the company's British publications have been accused of hacking into the cell phone voicemail of celebrities, politicians and even crime victims.

During a Brookings Institution forum on privacy, Christopher Soghoian, a cybersecurity researcher and former FTC technologist, noted that only some of the nation's top wireless carriers require their users to use a pin number to access their voicemail on their cell phones, adding that without such protection it's easy to hack into a user's voice mail. Soghoian demonstrated how to do it during an appearance on CBS News earlier this week.

Soghoian asked Leibowitz if he believed cell phone makers should adhere to the FTC's call for building privacy into products, a concept known as "privacy by design," and require their customers to use a pin to get voicemail on their cell phones.

"Yes. They should engage in privacy by design. I'd like to think most companies are moving in that direction," Leibowitz said, but added, "We have no jurisdiction whatsoever" over wireless carriers.

Leibowitz noted that his agency would like some jurisdiction over telecommunications carriers and that some lawmakers in Congress have floated the idea as it relates to privacy enforcement.

The Federal Communications Commission does have jurisdiction over cell phone and other telecom carriers, but Chairman Julius Genachowski has given no indication that his agency is pressing cell phone makers to make password-protected voicemail standard on all mobile phones.

During a hearing last week on privacy before a House subcommittee, Genachowski was asked about the security of cell phones in light of the hacking scandal. He noted that there are several U.S. laws that would cover any criminal hacking and said some carriers automatically require a password and some don't.

"There is no question that greater protection can be accomplished by using password protection and that this is an area that should be looked at," Genachowski said.

Google's critics Thursday were cheering a report that the Federal Trade Commission is poised to issue subpoenas against the Internet search giant as part of a possible antitrust probe.

The Wall Street Journal reported Thursday that the FTC is expected to seek more information from Google signaling the possible launch of a formal investigation into allegations the company has used its dominance of Internet search to favor its own products and services over rivals.

Neither the FTC nor Google would confirm the report. However, a source told Tech Daily Dose that the FTC has solicited information from some third-party companies in relation to their concerns about Google's behavior. The European Commission launched an antitrust probe of Google in November based on complaints from some competitors that Google manipulates its search rankings.

Among those who praised the possible FTC probe was the Fair Search coalition, which is made up of some of the firms that opposed Google's acquisition of travel software maker ITA Software such as Expedia Microsoft and Travelocity.

"Google engages in anti-competitive behavior across many vertical categories of search that harms consumers by restricting the ability of other companies to compete to put the best products and services in front of Internet users, who should be allowed to pick winners and losers online, not Google," the group said. "Google's practices are deserving of full-scale investigations by U.S. antitrust authorities, and are already the subject of reviews by the European Commission, and the Texas Attorney General."

The American Consumer Institute and Consumer Watchdog, a frequent Google critic, also applauded a potential antitrust probe of Google. "The time for an antitrust probe is long past due, and I'm optimistic the FTC investigation will lead to necessary remedies that will ensure competition in the market," Consumer Watchdog's John Simpson said.

The Senate Judiciary Committee also has been examining concerns over Google's dominance of Internet search. The committee's antitrust panel plans to hold a hearing on the issue before the August recess and has asked Google to send CEO Larry Page or Executive Chairman Eric Schmidt, who stepped down as CEO in April, to testify. So far, Google has refused, a subcommittee spokeswoman said Wednesday, but she added that the two sides are continuing to discuss the matter.

In the House, Rep. Albio Sires, D-N.J., Thursday urged the FTC to move forward with an antitrust probe. "Over time, complaints have increased regarding Google's anti-competitive behavior, in particular the use of its market power in search to push consumers to its own services. The time has come to seriously look into this issue," Sires said.

Boston University Law Professor Keith Hylton said if the FTC files a formal complaint, which it would do after studying information from Google and others, it would likely do so under Section 5 of the FTC Act, which bars "unfair methods of competition," and was the same law it used in its antitrust case against Intel, he said.

A T-Mobile subsidiary was among the groups that formally asked federal regulators to place conditions on a proposed merger between T-Mobile and AT&T.

In a petition to deny filed with the Federal Communications Commission this week, Iowa Wireless Services expresses concern about the potential effects of the merger. T-Mobile and its parent company, Deutsche Telekom, indirectly own 54 percent of Iowa Wireless.

"Iowa Wireless does not ask the Commission to deny AT&T's application on an absolute basis," according to the filing. "Rather, Iowa Wireless requests that the FCC also require AT&T to agree to certain commitments to foster the continued provision and expansion of wireless services in rural areas, should the FCC determine that the transaction is in the public interest."

Iowa Wireless asked the FCC to require AT&T to maintain networks, roaming services, and other existing agreements until Iowa Wireless is ready to shift, as well ensure that the smaller company can still gain access to the latest devices.

The company says AT&T's plan to upgrade to next-generation wireless could undermine investments made by Iowa Wireless as others.

What does the AT&T-T-Mobile merger portend for the spectrum crunch? Reuters says nothing good...

Other stuff we are reading about today

The Federal Trade Commission announced Tuesday that it has barred Westborough, Mass.-based Chitika, an online advertiser, from misleading consumers about its privacy policy. The company allows Internet users to opt out of being monitored online when they clicked on ads that Chitika places on websites. But the FTC found that from May 2008 to February 2010, the promised opt-outs lasted only ten days, instead of the promised 10 years.

The agency has now barred Chitika from misleading consumers and forced it to destroy any personal data that it collected using deceptive practices. The settlement with the FTC occurs as the Senate Commerce Committee prepares to hold a Wednesday hearing about online privacy, and as Sens. John Kerry, D-Mass., and John McCain, R-Ariz., ready major legislation in this area.

In a statement, Chitika claimed that the 10-day expiration was the result of an error that it never noticed for nearly two years until the FTC brought the matter to its attention. Reinforcing a concern raised by watchdogs -- that Web users rarely bother to opt out of being tracking online -- Chitika said it averaged a meager 30 opt-out requests per month over an international ad network that attracts more than 450 million consumers.

For more on the FTC settlement, click here

To learn more about Chitika, which according to its website means "snap of the fingers" in Telugu, a South Indian language, click here

Top privacy regulators agreed Thursday that the United States and the European Union are moving closer in their approaches to protecting consumer privacy. But they still remain at odds over whether a U.S. national law is needed to ensure companies follow widely agreed upon privacy principles.

During a discussion on the U.S. and European approaches to privacy protection at the International Association of Privacy Professionals conference, EU Data Protection Supervisor Peter Hustinx agreed with Federal Trade Commission Chairman Jon Leibowitz that the two sides are moving closer but noted one key difference remains: the Unites States still lacks a broad privacy protection law.

"I see more convergence than divergence," Leibowitz said.

The European Commission is currently in the process of reviewing its broad privacy framework, which includes the EU's 1998 data protection law. Hustinx said among the issues it plans to address include trying to reduce the "diversity" in how the law is applied among the EU's 27 member countries and ways to make the privacy law more effective.

The EU review comes as the FTC is sifting through the nearly 450 comments it received on a staff report released in December on proposals for boosting consumer privacy. Leibowitz noted that British and French data protection authorities were among those who submitted comments on the FTC report and they noted that many of the concepts in the it are "ones being stressed in the new regulatory framework in the EU."

Hustinx said he was glad to see a recognition in the FTC report that the "status quo in the U.S. is not satisfactory."

The FTC, however, does not have the authority to impose rules implementing the proposals in its privacy report, power that Congress would need to grant the agency by passing privacy legislation.

While the FTC has endorsed a controversial proposal calling for the creation of a "do-not-track" system to allow consumers to opt out of Internet tracking, the commission has not taken a stand on whether Congress should pass baseline privacy legislation, Leibowitz noted after the event.

The issue of whether the United States' privacy laws are up to par with the EU is more than a philosophical exercise. The EU's privacy directive bars the flow of data from the EU to countries that do not have "adequate" privacy rules.

The U.S. mix of industry self regulation and sector-specific privacy laws does not meet this standard on its own and as a result the Commerce Department negotiated a safe harbor with the EU in the late 1990s for those U.S. firms that agree to abide by a set of principles on how they will treat consumer privacy, which include notice, choice, security and data integrity.

Both Hustinx and Leibowitz were asked whether the United States would meet this adequacy standard if the United States finally passed a broad privacy law. Hustinx said that the "trend is moving in the right direction if the principles [in the report] are delivered as binding, baseline binding principles." But he added that "whether this is adequate in a technical sense may not be so decisive."

During a later discussion, Daniel Sepulveda, a staffer who works on privacy and other tech issues for Senate Commerce Communications Subcommittee Chairman John Kerry, D-Mass., also discussed the issue. In responding to claims by two industry officials that the EU is becoming more open to self regulation, Sepulveda said without a "backstop" in law, the U.S. system of protecting privacy will not be found to be adequate by the EU.

Sepulveda's boss is working on his own privacy legislation. The Senate Commerce Committee plans to hold a hearing next week on privacy at which Leibowitz is set to appear as well as other government and industry officials.