Eye Tea

I couldn’t believe my eyes when I saw this on the Beeb website today – on the home page in the feature story banner across the top, no less (see link below).

Apparently UK businesses need to wake up and sort themselves out by May – it’s another law change that we’re about to flout to the collective detriment.

The real stories are far more interesting.  I’ll start with the trite angle.  Someone’s been caught napping, but it’s not businesses: it’s our Government.  I may be mistaken but I don’t think it has tabled any legislation to implement this EU-sourced law, which was passed in November 2009, and covers lots of issues besides cookies.  (This may well be the real reason behind the regulator’s press release today.   What do you reckon?)

The important news angle is that many UK organisations probably don’t comply with the current data protection law on cookies and customer profiling, let alone the changes.   This is about old law and a wide range of organisations not just the businesses, across the public and charity, not for profit and voluntary sectors as well as for-profit organisations.  Think CRM, customer profiling, stakeholder and donor management … these are the activities that the law change affects, and they’re a focal point for many organisations who are feeling the pinch.

Another important point is a corrective.  The BBC says that the changes mean you have to get explicit consent before using cookies.  The EU law just says “consent, having been provided with clear and comprehensive information”, and to me that means that implied consent is enough.  EU law, like UK law, only means explicit consent when it says “explicit consent”.

Come on BBC, can’t you find some new angle for reporting consumer law changes instead of wheeling out a load of negative assumptions about UK business?  Can’t you run some positive case studies from organisations that already have simple, cost effective ways of coping, instead of making us all feel guilty about overlooking over-complicated laws?

Whatever, this new law definitely won’t affect all websites or all organisations.  Privacy campaigners rightly focused on cookies in the early years of the internet, and triggered a move away from cookies.  As a result modern ‘brochureware’ or informational websites often manage to provide a great user experience without resorting to cookies.

Cookies come in two flavours, session cookies and persistent cookies.  Simple session cookies are only used during a site visit, then they are deleted from the visitor’s machine.  These cookies are tarnished with the same brush but the legislation isn’t really aimed at them.

The law really affects charities and their donor networks; online retailers; professional businesses and consultancies that thrive on CRM; new media businesses for whom advertising is a major source of revenue; marketing and PR agencies; mailing list suppliers; the networks of advertisers, technology and suppliers who generate sales  leads.  It also affects organisations who have highly sophisticated CRM or lead generation systems which are derived from ecommerce/ social web/ web 2.0, or are strongly sales orientated.  Put it this way, you’re likely to need to think about cookie/ similar compliance if you’re doing the following or similar:

• your website presents adverts to visitors, selected by relevance to the customer’s interests
• your website carries adverts from third parties
• you use customer profiling
• your website use techniques for achieving/ maximising sales or leads
• you are an online retailer (ecommerce, e-contracting, e-retail)
• you generate revenue from selling customer details to third parties
• you use unsolicited email or phone calls and you use data from your website
• your website gives you statistics about individual users.

In other words, it will affect you if you really want to collect lots of information about your visitors, and you really want to leverage the information to make a sale or generate revenue from advertising or data sale.  If you use anything like Phorm, the new law will apply to you too.  (Phorm assigns you a number, not a name, and builds a profile about ‘you’ from a wide range of participating websites to make lead generation and sales more effective.  Perfectly lawful … if you do it properly.)

There are already five headline ways to break the law with cookies: don’t tell people that you’re using cookies, don’t tell people what you’re using cookies for, don’t give people an opportunity to opt out, give the cookie data to other organisations without permission, and evade or ignore opt outs.  Whatever the law gets around to saying, none of this is good for your business – it tarnishes relationships with customers, tarnishes reputation, and can lead to complaints and waste of management time.

We’ll have to wait and see what the UK Parliament does to implement the changes ready for 25 May.  ICO’s press release refers to solutions that would have a very low impact on UK organisations, such as a legal presumption that users who use a browser with adjustable privacy settings are deemed to consent if cookies settings are switched on.  Which leaves us pretty much where we are.

Adopting a risk-based approach, how hard you have to try with getting consent under the current law depends in the real world on what you’re doing with the information.  If you’re just using session cookies, arguably you just mention that in the website privacy statement but make not much more of it.  If you’re doing any of the stuff in the bullet point list above you need to be going through a process of getting consent before you do that.  There are lots of ways to do this.  A classic one is that you only apply cookies to registered users, you tell them explicitly about your use of cookies during the sign-up process, and you give them a chance to opt out.  It’s good practice to include a link to information about how to manage browser privacy settings.  You might also give users the facility switch off cookies via their registered user account settings going forwards.

Any organisation that does lots of CRM, donor/ stakeholder management, lead generation or sales should be looking pretty hard at data protection compliance across the board at the moment if it hasn’t done so over within the last 18 months.  Lots of my clients are doing a policy review or full compliance refresh.  For many it’s a routine review.  Even for those who don’t have a routine, let’s face it data protection compliance isn’t something you want or really need to be staring hard at every week, or even every month.  There should be no embarrassment about being in the position of playing catch up, and shame on the BBC for pretending that there is.

Come on folks, let’s just get on with it!  By the way, there are lots of other changes that the new laws will bring in, which are nicely hinted at by Hawktalk, an excellent technical blog on privacy (see the link below).

Links
BBC article: http://www.bbc.co.uk/news/technology-12668552

Information Commissioner’s announcement: http://www.ico.gov.uk/news/press_releases.aspx (8 March)

Hawktalk: http://amberhawk.typepad.com/amberhawk/2010/05/eu-directive-can-require-consent-for-behavioural-advertising.html

While I was on holiday in July the Government started a review of how UK and EC data protection law is going. It wants case studies that illustrate how we are all finding the law – good things and bad – to inform its negotiations on the new EC Directive.  At the same time the Government is assessing the impact of the Data Protection Act 1998.

What are your experiences? What works and makes things better for business and consumers? What’s rubbish? If we get a good raft of comments on this page, I’ll batch them up and submit them. The doors close on this stage of the review on 6 October.

Here are a few initial thoughts from me:

• The £10 fee for making disclosures to the data subject is disproportionately low in most cases.  It costs more than £10 in real terms to drop a letter or phone call back to the requester asking them if they will consider narrowing down their request. 
• The burden of regulation should apply directly to data processors.  It’s not appropriate for data controllers to carry the can for a processor’s breach, or for that risk to be a topic of negotiation in the contract.
• Data sharing between organisations is essential across all sectors, often driven by outsourcing or partnerings.  It gets complicated, and in this context the legal concepts of “data controller” and “data processor” are blunt and inadequate.  We need some extra concepts to deal with the subtleties.
• What about sensitive personal data?  Is it right to give special status to certain categories of personal information?  Should special status be available to any information if the risks require?  Shouldn’t payment card details be included in the list?
• Does management of consents and permissions from customers give you a headache?  Would it be helpful if the law clarified what constitutes “consent”, especially where you lawfully hold personal data but need to cost-effectively change how you use it as your organisation develops?  Would it work if the law was relaxed for organisations who give their customers and contacts transparent information and control over their permissions, eg via a website?
• Do the opportunities for processing personal data without consent need to be wider?
• Do you think the law is realistic, or too high level?  Would you like more regulation so you have less discretion but more clarity about how to deal with compliance?  Or less regulation and more effective guidance from the regulator?
• If your organisation is international, how do you find it dealing with several different regulators and different laws, even within the EU?
• Is compulsory notification to the regulator really necessary?

The new directive will be with us for many years – the current one will have done over 15 years service by next year.  The changes are expected to include a move towards an “accountability” model, where rules are replaced by a more flexible, outcome-focused approach to regulation, and the regulator is re-cast as the overseer and auditor of a largely self-regulating system.  What do you think?  Old wine in new skins, or a worthwhile change?  What are the essential benefits?  What do we need to avoid?

Link: http://www.justice.gov.uk/call-for-evidence-060710.htm