- How the operator responds to DNT signals or other mechanisms that provide consumer choice about tracking. This disclosure can be satisfied by providing a hyperlink to a program or protocol, such as an industry self-regulatory group protocol, the operator follows that offers the consumer choice.
- Disclose whether other parties may collect personally identifiable information about an individual consumer’s online activities over time and across different websites when a consumer uses the operator’s website or service.
The California Attorney General interprets the existing CalOPPA requirements as pertaining to mobile applications as well as to traditional web sites. It remains to be seen how the new provisions will be applied in the mobile space.
Disclosure of Do-Not-Track practices
The meaning of “Do Not Track” is not defined in the statute, nor is there a commonly accepted definition of DNT in the industry. Currently, and in response to FTC urging, every major browser has developed a DNT mechanism for consumers. However, even when selected by a user, the DNT setting does not automatically block tracking. Instead, the user’s browser transmits a DNT header which the website and ad networks are free to ignore.
Despite more than two years of negotiations, the World Wide Web Consortium (W3C) multi-stakeholder working group on “Do Not Track,” has yet to define a uniform standard for companies responding to DNT browser signals. The deadlocked working group now appears to be falling apart as the debate devolves into a polarization of interests. The disagreement centers on what a user’s election not to be “tracked” ultimately means. The Digital Advertising Alliance and its supporters define tracking narrowly and argue that a company should cease serving targeted advertising in response to a DNT signal, but may still collect information; i.e., track consumers, for non-advertising purposes such as analytics. Privacy advocates, on the other hand, contend that when a user opts out of tracking within a browser, a company should not collect tracking data for any purpose.
Unfortunately, until this debate is resolved, the new California legislation may raise as many questions as it answers, because now companies are required to disclose how they respond to a browser’s DNT signals, when there is no consensus on what the DNT signal means in the first place.
So what should companies do in the meantime? They have three options.
1. Do not honor. A company can disclose that it does not honor the DNT signal sent by browsers and then wait out the debate. While perfectly legal, this choice, unfortunately, leaves many consumers in the cold and is not the best option from a public relations standpoint.
3. Take advantage of industry program safe harbor. A third alternative is to try to take advantage of the safe harbor built into the CalOPPA amendment: The new legislation permits companies to satisfy the disclosure obligation by providing a hyperlink to “any program or protocol that the operator follows” that offers consumers the ability to exercise choice regarding the collection of personally identifiable information about their online activities over time and across third-party websites.
Today, the industry self-regulatory group protocol that is most widely known and adopted is the Digital Advertising Alliance’s (DAA) Self-Regulatory Program for Online Behavioral Advertising, which provides a set of guidelines for companies to follow, an in-ad disclosure and opt-out mechanism (the AdChoices icon), and an industry-wide opt-out mechanism. Questions remain as to how a company may comply with the DNT disclosure obligations under this safe harbor provision.
First, under the language of the statute—“any program or protocol that the operator follows”—it seems likely that a company must actually be in full compliance with the self-regulatory program in order to take advantage of the statutory safe harbor, rather than merely offering a link to the program’s opt-out mechanism. And what if the company works with ad networks or other ad tracking partners who are not members of the DAA self-regulatory program? Would that scenario nullify compliance through the safe harbor? To mitigate this risk, companies may want to confirm that that those tracking on their sites are DAA members. Finally, it is still unclear if any additional disclosures will be required beyond providing a hyperlink to the opt-out mechanism of a self-regulatory program with which the company complies, such as by disclosing that the program only provides an opt-out from being served behaviorally targeted advertisements, but does not prevent the collection of web-browsing behavior.
Disclosure of Third-Party Data Collection
Although there seems to be a great deal of uncertainty and ambiguity in the language of the new California DNT law, companies should make a good faith effort to demonstrate compliance. Thankfully, the new law includes a grace period should operators be found to have not provided the required disclosures. Operators will be given a warning and 30 days to comply before being found in violation of the statute.