BIGtoken Weekly Data Privacy Roundup

Last week, state privacy rulings included failures in Florida and Washington. At this point, to the disappointment of privacy rights supporters, Virginia is the only state to pass a privacy law in 2021. Each week, it becomes increasingly clear that the privacy issue will only be effectively resolved at the federal level.

State Data Privacy Bills Stumble,” Wall Street Journal- May 7th, 2021

A major sticking point in many privacy bills is whether consumers have the ability to sue companies for violations of privacy rights. These issues, most agree, need to be resolved at the federal level, a sentiment shared by both corporate lobbyists and consumer advocates. Because of the differences between these two adversarial groups concerning laws/regulations at the state level and the importance of privacy laws, the federal agreement must bridge the gap and pass a law that satisfies both groups.

“Does The Alphabet Soup of Data Legislation Actually Protect Your Data?” Forbes- May 4th, 2021

Quite simply, it is difficult to understand where states considering privacy laws stand at any given time. While many states are debating privacy bills, the divergence of existing and/or pending regulations make it extremely difficult for companies to structure consistent and necessary controls. Actual or proposed laws attempt to address various areas of privacy protection including identity protection, data protection, technical identity protection, and the use of cookies. Consistently, all involved continue to advocate resolution of these critical issues at the federal level.

Virginia Privacy Law Adds Data Security Rules,” MSN- May 7th, 2021

While other states continue to debate privacy bills, Virginia, the only state which has passed a privacy law in 2021 (becomes effective in January 2023), has strengthened its privacy law by now requiring companies to conduct data protection assessments. For the privacy issue to become more effective, more states need to follow Virginia or California and pass similar privacy laws and/or the federal government takes over the debate.

Rather than relying on often obscure or nonexistent privacy laws, both companies and consumers have begun to alter their methods of business by implementing their own changes to resolve privacy concerns. The changes include consumers’ choice to use guest checkout options and companies’ creation of loyalty programs to ensure consented data collection.

 “Many Online Shoppers Are Using Guest Checkout Over Data Privacy Fears,” MSN- May 5th, 2021

As privacy issues become greater concerns for consumers, online shoppers have begun using guest checkout options which allow them to buy goods and services without giving up a significant amount of personal information. In a recent study, it was found that over 40% of online shoppers are worried about the use of their data from online shopping.  For these consumers, part of their self-protection relies on passing on limited information by utilizing guest checkout options.  From a companies’ perspective, the answer lies in creating improved brand loyalty and trust that consumer information will be treated fairly with a focus on maintaining privacy.

“How Loyalty Programs Are Helping To Solve Privacy Concerns In A Cookieless World,” Digiday- May 4th, 2021

Companies, in the wake of the elimination of cookies which was the fuel for targeted advertising, are considering other ways of identifying consumers that would truly be interested in the companies’ brands and services. The major shift in today’s advertising market is to focus on first-party data collected with direct consumer consent from brands they desire and trust. Providing value to the consumer is a critical way to obtain this first-party data through methods such as loyalty programs. Deriving value from advertising campaigns for desired brands will reduce consumers’ privacy concerns and the inundation of unwanted advertising campaigns.

The WhatsApp fiasco over their privacy policy allowing parent-company Facebook to collect personal information from the WhatsApp messaging system appears to be coming to an unexpected but welcome conclusion. It appears that Facebook and WhatsApp are waving the white flag in defeat.

Facebook Admits Defeat Over Controversial WhatsApp Privacy Policy,” BGR- May 7th, 2021

Facebook’s privacy policy demanding access to all personal data collected by WhatsApp, a Facebook owned company, set off a firestorm of negative reaction and a mass exodus of users from WhatsApp.  Rather than capitulating to the demands of its users to protect their privacy, Facebook and WhatsApp continued to tout its new strategy with the threat of removing users from the WhatsApp system. This aggressive approach backfired resulting in Facebook finally admitting defeat just days before the forced acceptance over its far-reaching data collection privacy (or lack thereof) policies.  It will be very interesting to watch the long-term negative impact resulting from Facebook and WhatsApp’s attempts to force unreasonable consents on its users despite admitting defeat.