WASHINGTON - US regulators in charge of protecting the privacy of consumers are proposing safeguards including a "Do Not Track" mechanism for people who want to be stealthy online.
The Federal Trade Commission (FTC) preliminary staff report released on Wednesday is intended as a framework for balancing privacy and innovation on the internet.
"The FTC wants to help ensure that the growing, changing, thriving information marketplace is built on a framework that promotes privacy, transparency, business innovation and consumer choice," FTC chairman Jon Leibowitz said in a statement.
The report said industry efforts to address privacy through self-regulation "have been too slow, and up to now have failed to provide adequate and meaningful protection."
Recommendations include the creation of a "Do Not Track" option, perhaps built into web browsing software, which would signal online services not to collect surfing or ad-targeting data.
"The report confirms that many companies - both online and offline - don't do enough to protect consumer privacy," said Democratic Senator John Kerry.
"Today's technology makes it easy for companies to obtain, collect, store, and transfer unprecedented amounts of information, but industry self regulation has proven inadequate to protect consumers."
Leibowitz warned that the FTC will take action against companies that "cross the line" with consumer data and violate privacy "especially when children and teens are involved."
While many companies manage people's private information responsibly, some appear to treat it recklessly, the report maintained.
"Industry must do better," the report stated. "For every business, privacy should be a basic consideration similar to keeping track of costs and revenues, or strategic planning."
In the wake of record US "Cyber Monday" sales in which online shopping topped a billion dollars, the FTC noted that advertisers routinely collect and share information about websites visited and content viewed.
Third-party applications can get access to personal information posted at online social networks, while location-based services for mobile devices promise maps of people's movements.
Even the use of "loyalty" cards at shops or the filing of product warranty cards can provide purchase and other information to data brokers, according to the FTC.
The commission proposed that companies build consumer privacy into everyday practices by only collecting data they need and then safely deleting it after it has fulfilled its purpose.
Companies should also streamline and simplify privacy choices for people, with the most practical method being an easy-to-find web browser switch that lets people avoid having online behavior tracked, the report said.
The FTC also wants companies to simplify lengthy and convoluted privacy policies that "consumers typically do not read, let alone understand."
The FTC asked "interested parties" to submit feedback on the proposed framework by January 31 and expected to have its new policies in place later next year.
Consumer advocacy and privacy watchdog groups praised the report as a sign that the FTC is finally tuning into internet age privacy perils and urged Congress to act swiftly to pass federal privacy law.
"It is a very one-sided arms race right now between privacy and tracking. Trackers are two or three steps ahead," said Electronic Frontier Foundation senior staff technologist Peter Eckersley.
Ginger McCall of the Electronic Privacy Information Center suggested the creation of a federal agency devoted exclusively to guarding consumer privacy.
World Privacy Forum director Pam Dixon welcomed the spotlight on "data brokers" by including them among companies that must let people know what information about them has been gathered.