Markets Wired

As part of its review of its environmental marketing guidelines, also known as the “Green Guides,” the Federal Trade Commission will host its third public workshop to examine developments in environmental claims for building products, buildings, and textiles, along with consumer perceptions of those claims, on Tuesday, July 15, 2008, from 9:00 a.m. to 5:00 p.m. The workshop will provide an opportunity for interested parties to study green textile and building claims. Discussion topics will include: 1) consumer perceptions of environmental claims for building and textile products; 2) the state of substantiation for green building and textile claims; and 3) the need for additional or updated FTC guidance in these areas. The workshop will be held at the agency’s satellite building in Washington, DC. FTC Chairman William E. Kovacic will provide opening remarks.

Webcast Information

Individuals who are unable to attend the workshop can view a live
Webcast by connecting to this link:
http://htc-01.media.globix.net/COMP008760MOD1/ftc_web/FTCindex.html

Commission approval of Federal Register notice – The Commission has approved the publication of an Advance Notice of Proposed Rulemaking (ANPR) in the Federal Register to initiate a proceeding to evaluate labeling requirements for “lamps,” more commonly known as light bulbs. As detailed in the ANPR, section 321 of the Energy Independence and Security Act of 2007 (EISA) requires the FTC to conduct a rulemaking to consider the effectiveness of current labeling requirements for lamps and to explore alternative labeling approaches. As the initial step in this effort, the Commission has approved an ANPR seeking comment on existing lamp labeling requirements and possible alternatives. The ANPR also announced a September 15, 2008 public roundtable meeting on lamp labeling to help the Commission accomplish its mandate in this area. The ANPR will be published shortly and is available now on the FTC’s Web site at http://www.ftc.gov/os/2008/07/P084206frnanprlamps.pdf.

The ANPR announced today provides background about current light bulb labeling requirements, the recent mandate in the EISA, the purpose of the FTC labeling requirements, and various labeling considerations. The notice also contains a series of questions related to the effectiveness of current labeling and potential labeling alternatives to help focus comments and discussion at the public meeting in September. The Commission vote approving publication of the ANPR was 4-0. (FTC File No. P084206; the staff contact is Hampton Newsome, Bureau of Consumer Protection, 202-326-2889.)

Copies of the documents mentioned in this release are available from the FTC’s Web site at http://www.ftc.gov and from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, DC 20580. Call toll-free: 1-877-FTC-HELP.

(FYI 36.2008.wpd)

Commission approval of Federal Register notice – The Commission has approved the publication of an Advance Notice of Proposed Rulemaking (ANPR) in the Federal Register to initiate a proceeding to evaluate labeling requirements for “lamps,” more commonly known as light bulbs. As detailed in the ANPR, section 321 of the Energy Independence and Security Act of 2007 (EISA) requires the FTC to conduct a rulemaking to consider the effectiveness of current labeling requirements for lamps and to explore alternative labeling approaches. As the initial step in this effort, the Commission has approved an ANPR seeking comment on existing lamp labeling requirements and possible alternatives. The ANPR also announced a September 15, 2008 public roundtable meeting on lamp labeling to help the Commission accomplish its mandate in this area. The ANPR will be published shortly and is available now on the FTC’s Web site at http://www.ftc.gov/os/2008/07/P084206frnanprlamps.pdf.

The ANPR announced today provides background about current light bulb labeling requirements, the recent mandate in the EISA, the purpose of the FTC labeling requirements, and various labeling considerations. The notice also contains a series of questions related to the effectiveness of current labeling and potential labeling alternatives to help focus comments and discussion at the public meeting in September. The Commission vote approving publication of the ANPR was 4-0. (FTC File No. P084206; the staff contact is Hampton Newsome, Bureau of Consumer Protection, 202-326-2889.)

Copies of the documents mentioned in this release are available from the FTC’s Web site at http://www.ftc.gov and from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, DC 20580. Call toll-free: 1-877-FTC-HELP.

(FYI 36.2008.wpd)

Commission approval of report to Congress – The Commission has approved the issuance of a report to Congress regarding the Do Not Call Registry for Fiscal Year 2007. The report, which is available now as a link to this press release on the FTC’s Web site, has been submitted to the U.S. House of Representatives Committee on Energy and Commerce and the U.S. Senate Committee on Commerce, Science, and Transportation, as required by Section 4(b) of the Do Not Call Implementation Act.

The report – the fourth and final submission required by the Act – contains information on the following topics: 1) the effectiveness of the Registry; 2) the number of consumers who have placed their telephone numbers on the Registry; 3) the number of entities paying fees to access the Registry and the amount of the fees; 4) the progress of coordinating the operation and enforcement of the Registry with similar registries maintained by the states; 5) the progress of coordinating the operation and enforcement of the Registry with enforcement activities of the Federal Communications Commission under the Telephone Consumer Protection Act; and
6) FTC enforcement of the Registry under the Telemarketing Sales Rule.

The Commission vote approving issuance of the report was 4-0. (FTC File No. P034305; the staff contact is John Krebs, Bureau of Consumer Protection, 202-326-3747.)

Copies of the documents mentioned in this release are available from the FTC’s Web site at http://www.ftc.gov and from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, DC 20580. Call toll-free: 1-877-FTC-HELP.

(FYI 34.2008.wpd)

In testimony on behavioral advertising, the Federal Trade Commission today told the U.S. Senate Committee on Commerce, Science, and Transportation that “the issues surrounding this practice are complex … the business models are diverse and constantly evolving, and … behavioral advertising may provide benefits to consumers even as it raises concerns about consumer privacy.”

In the FTC’s testimony, Lydia Parnes, Director of the FTC’s Bureau of Consumer Protection, told the Committee that behavioral advertising, defined as “the practice of collecting information about an individual’s online activities in order to serve advertisements that are tailored to that individual’s interests,” typically involves the use of “cookies,” or small text files placed on an individual’s computer, to collect information about the pages viewed and other online activities. The testimony also states that, in many cases, the practice involves collecting consumer information that is not personally identifiable in the traditional sense – that is, it does not identify the consumer by name, address, or similar identifier. The practice also can involve the sharing of the information with networks that serve advertisements at Web sites across the Internet.

According to the testimony, behavioral advertising may provide a variety of benefits to consumers, including free content, personalization of ads, and a potential reduction in unwanted advertising. Consumer research has shown that consumers value online ads that are more personalized. These ads may facilitate shopping for specific products. Further, behavioral advertising may help subsidize and support a diverse range of free online content and services that might otherwise not be available or that consumers would have to pay for, for example, blogging, search engines, and instant access to news and other information.

On the other hand, consumers have expressed discomfort about the privacy implications of being tracked online, as well as the specific harms that could result. In particular, “Without adequate safeguards in place, consumer tracking data may fall into the wrong hands or be used for unanticipated purposes,” the testimony states. “These concerns are exacerbated when the
tracking involves sensitive information about, for example, children, health, or a consumer’s finances.”

The testimony also described Commission efforts and initiatives in the consumer privacy area, including its recent work to address the privacy issues raised by online behavioral advertising. According to the testimony, consumer privacy issues such as data security, identity theft, spam, and spyware have been top agency priorities since the mid-1990s, and the Commission has worked to address these issues through a combination of consumer and business education, law enforcement, and policy initiatives. As part of its privacy program, in November 2007, the Commission held a two-day town hall meeting on behavioral advertising. In response to issues raised at the town hall, in December Commission staff released for public comment a set of proposed behavioral advertising principles for self-regulation.

According to the testimony, “the Commission is cautiously optimistic that the privacy concerns raised by behavioral advertising can be addressed by industry self-regulation,” which “affords the flexibility that is needed as business models continue to evolve.” The testimony noted, however, that the FTC will continue to monitor the marketplace closely so it can take appropriate action as circumstances warrant.

The Commission vote to approve the testimony was 4-0.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,500 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics.

In testimony on behavioral advertising, the Federal Trade Commission today told the U.S. Senate Committee on Commerce, Science, and Transportation that “the issues surrounding this practice are complex … the business models are diverse and constantly evolving, and … behavioral advertising may provide benefits to consumers even as it raises concerns about consumer privacy.”

In the FTC’s testimony, Lydia Parnes, Director of the FTC’s Bureau of Consumer Protection, told the Committee that behavioral advertising, defined as “the practice of collecting information about an individual’s online activities in order to serve advertisements that are tailored to that individual’s interests,” typically involves the use of “cookies,” or small text files placed on an individual’s computer, to collect information about the pages viewed and other online activities. The testimony also states that, in many cases, the practice involves collecting consumer information that is not personally identifiable in the traditional sense – that is, it does not identify the consumer by name, address, or similar identifier. The practice also can involve the sharing of the information with networks that serve advertisements at Web sites across the Internet.

According to the testimony, behavioral advertising may provide a variety of benefits to consumers, including free content, personalization of ads, and a potential reduction in unwanted advertising. Consumer research has shown that consumers value online ads that are more personalized. These ads may facilitate shopping for specific products. Further, behavioral advertising may help subsidize and support a diverse range of free online content and services that might otherwise not be available or that consumers would have to pay for, for example, blogging, search engines, and instant access to news and other information.

On the other hand, consumers have expressed discomfort about the privacy implications of being tracked online, as well as the specific harms that could result. In particular, “Without adequate safeguards in place, consumer tracking data may fall into the wrong hands or be used for unanticipated purposes,” the testimony states. “These concerns are exacerbated when the
tracking involves sensitive information about, for example, children, health, or a consumer’s finances.”

The testimony also described Commission efforts and initiatives in the consumer privacy area, including its recent work to address the privacy issues raised by online behavioral advertising. According to the testimony, consumer privacy issues such as data security, identity theft, spam, and spyware have been top agency priorities since the mid-1990s, and the Commission has worked to address these issues through a combination of consumer and business education, law enforcement, and policy initiatives. As part of its privacy program, in November 2007, the Commission held a two-day town hall meeting on behavioral advertising. In response to issues raised at the town hall, in December Commission staff released for public comment a set of proposed behavioral advertising principles for self-regulation.

According to the testimony, “the Commission is cautiously optimistic that the privacy concerns raised by behavioral advertising can be addressed by industry self-regulation,” which “affords the flexibility that is needed as business models continue to evolve.” The testimony noted, however, that the FTC will continue to monitor the marketplace closely so it can take appropriate action as circumstances warrant.

The Commission vote to approve the testimony was 4-0.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,500 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics.