An Analysis of Online Privacy Policies of Fortune 100 Companies

An Analysis of Online Privacy Policies of Fortune 100 Companies

Suhong Li (Bryant University, USA)
Copyright: © 2009 |Pages: 15
DOI: 10.4018/978-1-60566-012-7.ch013
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Abstract

The purpose of this chapter is to investigate the current status of online privacy policies of Fortune 100 Companies. It was found that 94% of the surveyed companies have posted an online privacy policy and 82% of them collect personal information from consumers. The majority of the companies only partially follow the four principles (notice, choice, access, and security) of fair information practices. For example, most of the organizations give consumers some notice and choice in term of the collection and use of their personal information. However, organizations fall short in security requirements. Only 19% of organizations mention that they have taken steps to provide security for information both during transmission and after their sites have received the information. The results also reveal that a few organizations have obtained third-party privacy seals including TRUSTe, BBBOnline Privacy, and Safe Harbor.
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Introduction

Privacy is defined as “the right to be let alone” which is part of the basic human rights to enjoy life (Warren, 1890). As an extension of privacy in the information age, information privacy is the legitimate collection, use, and disclosure of personal information, or “the claims of individuals that data about themselves should generally not be available to other individuals and organizations, and that, where data is possessed by another party, the individual must be able to exercise a substantial degree of control over that data and its use” (Clarke, 1999). One type of information privacy is online privacy, which is defined as “consumer concerns about what data is being collected by an online vendor about the customer and how it will be used” (Nyshadham, 2000). Compared to an off-line environment, the Internet enables organizations to collect more information from consumers cost effectively, sometimes even without the consent of consumers. The Internet poses greater security threats for consumers as their personal information is transmitted over the Internet if an organization does not have a good security mechanism in place. Furthermore, the connectivity of the Internet allows organizations to capture and build electronic profiles of consumers and potential consumers. Therefore, consumers today are facing a high level of privacy threat/invasion. One way to show an organization’s commitment to protect consumers’ online privacy is to post an online privacy policy and follow the policy truthfully. Online privacy has been viewed as a significant factor contributing to consumer trust and therefore an imperative for business success (Privacy & American Business, 2002). However, its provision is often at odds with organizational goals—such as the maximization of personal information value obtained from disclosure to third parties (often for commercial gain) and the retention of customer loyalty via enhanced personalized services (Lichtenstein, Swatman, & Babu, 2003).

The confrontation of individual versus organizational privacy prospective has started to drawn social and governmental attention. The Federal Trade Commission (FTC) has brought a number of principles to enforce the promises in organization’s privacy statements (FTC, 1998; FTC, 2005). The FTC suggests a set of principles regarding collection, use, and dissemination of information which will ensure fair information practices. These principles include four core principles called notice, choice, access, and security. The implementations of these principles are as follows: first, organizations should tell consumers what information they collect and how it will be used (notice); second, consumers should be offered a choice about having their personal information used for other unrelated purposes or shared with third parties (choice); third, consumers should be able to review their personal information and have errors corrected (access); finally, organizations should protect the personal information they collect (security). If an organization follows all these principles, it can then be said to follow fair information practices (Nyshadham, 2000). Fair information practices have been used as a standard to evaluate the online privacy policy of organizations in several studies (Nyshadham, 2000).

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Table of Contents
Acknowledgment
Kuanchin Chen, Adam Fadlalla
Chapter 1
Andrew Pauxtis
What began as simple homepages that listed favorite Web sites in the early 1990’s have grown into some of the most sophisticated, enormous... Sample PDF
Google: Technological Convenience vs. Technological Intrusion
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Chapter 2
Angelena M. Secor
In this chapter, consumer online privacy legal issues are identified and discussed. Followed by the literature review in consumer online privacy... Sample PDF
A Taxonomic View of Consumer Online Privacy Legal Issues, Legislation, and Litigation
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Chapter 3
Hy Sockel, Louis K. Falk
There are many potential threats that come with conducting business in an online environment. Management must find a way to neutralize or at least... Sample PDF
Online Privacy, Vulnerabilities, and Threats: A Manager's Perspective
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Chapter 4
Thejs Willem Jansen
Governments and large companies are increasingly relying on information technology to provide enhanced services to the citizens and customers and... Sample PDF
Practical Privacy Assessments
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Chapter 5
Leszek Lilien, Bharat Bhargava
Any interaction—from a simple transaction to a complex collaboration—requires an adequate level of trust between interacting parties. Trust includes... Sample PDF
Privacy and Trust in Online Interactions
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Chapter 6
Huong Ha, Ken Coghill
The current measures to protect e-consumers’ privacy in Australia include (i) regulation/legislation; (ii) guidelines; (iii) codes of practice; and... Sample PDF
Current Measures to Protect E-Consumers' Privacy in Australia
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Chapter 7
Anil Gurung, Anurag Jain
Individuals are generally concerned about their privacy and may withhold from disclosing their personal information while interacting with online... Sample PDF
Antecedents of Online Privacy Protection Behavior: Towards an Integrative Model
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Chapter 8
Alan Rea, Kuanchin Chen
Protecting personal information while Web surfing has become a struggle. This is especially the case when transactions require a modicum of trust to... Sample PDF
Privacy Control and Assurance: Does Gender Influence Online Information Exchange?
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Chapter 9
Bernadette H. Schell, Thomas J. Holt
This chapter looks at the literature—myths and realities—surrounding the demographics, psychological predispositions, and social/behavioral patterns... Sample PDF
A Profile of the Demographics, Psychological Predispositions, and Social/Behavioral Patterns of Computer Hacker Insiders and Outsiders
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Chapter 10
Chiung-wen ("Julia") Hsu
This chapter introduces a situational paradigm as a means of studying online privacy. It argues that data subjects are not always opponent to data... Sample PDF
Privacy or Performance Matters on the Internet: Revisiting Privacy Toward a Situational Paradigm
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Chapter 11
Tom S. Chan
While delivering content via the Internet can be efficient and economical, content owners risk losing control of their intellectual property. Any... Sample PDF
Online Consumer Privacy and Digital Rights Management Systems
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Chapter 12
Betty J. Parker
Marketing practices have always presented challenges for consumers seeking to protect their privacy. This chapter discusses the ways in which the... Sample PDF
Online Privacy and Marketing: Current Issues for Consumers and Marketers
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Chapter 13
Suhong Li
The purpose of this chapter is to investigate the current status of online privacy policies of Fortune 100 Companies. It was found that 94% of the... Sample PDF
An Analysis of Online Privacy Policies of Fortune 100 Companies
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Chapter 14
Andy Chiou
In this chapter, the authors will briefly discuss some cross cultural concerns regarding Internet privacy. The authors believe that due to the cross... Sample PDF
Cross Cultural Perceptions on Privacy in the United States, Vietnam, Indonesia, and Taiwan
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Chapter 15
Sean Lancaster
Biometrics is an application of technology to authenticate users’ identities through the measurement of physiological or behavioral patterns. The... Sample PDF
Biometric Controls and Privacy
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Chapter 16
G. Scott Erickson
This chapter focuses on the specific issue of the federal Freedom of Information Act and associated state and local freedom of information laws.... Sample PDF
Government Stewardship of Online Information: FOIA Requirements and Other Considerations
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Chapter 17
Charles O’Mahony
This chapter will discuss the legal framework for consumer and data protection in Europe. Central to this discussion will be the law of the European... Sample PDF
The Legal Framework for Data and Consumer Protection in Europe
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Chapter 18
Karin Mika
This chapter provides an overview of law relating to online and Internet medical practice, data protection, and consumer information privacy. It... Sample PDF
Cybermedicine, Telemedicine, and Data Protection in the United States
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Chapter 19
J. Michael Tarn
This chapter explores the current status and practices of online privacy protection in Japan. Since the concept of privacy in Japan is different... Sample PDF
Online Privacy Protection in Japan: The Current Status and Practices
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About the Contributors