IBM today is introducing a consulting service aimed at helping companies handle the personal data they collect from their customers via the Web and steering clear of new laws governing that information.
"The whole growth of electronic commerce is being fueled by companies collecting personal information," says Neil Isford, VP of E-business services at IBM Global Services. But as that happens, he says, customers are starting to ask questions about what companies are doing with information such as what types of airline seats they like and which authors are their favorites. U.S. government regulators are asking the same questions and are considering legislation to protect consumer privacy. Legislators in Europe have already passed a sweeping law called the European Union Data Protection Initiative, which could prevent any company from transferring even simple personal data outside the region unless specific requirements are met. The law goes into effect Oct. 26 and is a major focus of the IBM initiative.
Isford says the directive is prompting many corporations to take a closer look at their privacy policies and some have already taken steps to make more complete disclosure to their European customers about what information is being collected about them and how they can opt out of the data collection system.
The U.S. Federal Trade Commission, in a survey earlier this year, found that only 14% of U.S. Web sites have posted privacy policies. The IBM service--which is being created in conjunction with Privacy Consulting Group, a firm headed by former college professor Alan Westin--is aimed at helping companies create and improve their privacy policies and align them with the underlying technology. The effort will compete with somewhat similar offerings from large accounting firms that conduct privacy audits and offer guidance about handling privacy issues.