Today the FTC released a preliminary staff report that proposes a “do not track” mechanism allowing consumers to opt out of data collection on online searching and browsing activities. The FTC report says that industry self-regulation efforts on privacy have been “too slow, and up to now have failed to provide adequate and meaningful protection.”

“To reduce the burden on consumers and ensure basic privacy protections, the report first recommends that “companies should adopt a ‘privacy by design’ approach by building privacy protections into their everyday business practices.” Such protections include reasonable security for consumer data, limited collection and retention of such data, and reasonable procedures to promote data accuracy. … Second, the report states, consumers should be presented with choice about collection and sharing of their data at the time and in the context in which they are making decisions – not after having to read long, complicated disclosures that they often cannot find. … One method of simplified choice the FTC staff recommends is a “Do Not Track” mechanism governing the collection of information about consumer’s Internet activity to deliver targeted advertisements and for other purposes. Consumers and industry both support increased transparency and choice for this largely invisible practice. The Commission recommends a simple, easy to use choice mechanism for consumers to opt out of the collection of information about their Internet behavior for targeted ads. The most practical method would probably involve the placement of a persistent setting, similar to a cookie, on the consumer’s browser signaling the consumer’s choices about being tracked and receiving targeted ads.”

The full text of the 120-page report, Protecting Consumer Privacy in an Era of Rapid Change — a proposed framework ofr businesses and policymakers is available online.