The bill boasted bipartisan support and won the praise of consumer advocate groups, but it did not attract enough votes to carry it through the next legislative step. The idea was to pay a 17-member commission some $5 million for a year and a half of service to study privacy as it relates not only to the Internet but also to medical, financial and government records.
Proponents of the bill moaned in obvious disappointment after learning of the bill's failure.
"These issues will undoubtedly be at the forefront of next session," said Ken Segarnick, assistant general counsel for West Chester, Penn.-based UnitedMessaging.com, an email service that was lobbying for the bill's passage. "We need some body of experts to provide consultation to members of Congress and the administration to identify privacy issues, evaluate self-regulatory efforts, and determine the best course of action."
Concerns over privacy peaked earlier this year as consumers became more aware of the amount of information collected about them--online and off.
Consumer profiles can include such sensitive information as what kind of books are checked out of the local library or which Web sites an individual surfs. Usually the information is kept for marketing purposes, deemed beneficial for those who don't have time to shop and would rather have advertisements sent to them that speak to their tastes.
But occasionally, a person's information is obtained surreptitiously and even peddled to third parties for profit. The fear is that people don't have control over their own dossiers.
Toysmart.com touched off a storm of criticism last month when the bankrupt online toy store claimed its profiles of about 250,000 customers were an asset that could be sold along with the business.
Public outcry also forced DoubleClick in March to hold off plans to combine online and offline data that it collects about consumers.
Worries about consumer data mining have spawned several organizations, including Junkbusters.com, the Electronic Privacy Information Center (EPIC) and the Privacy Rights Clearinghouse, which are fighting for protections by lobbying legislators.
Today's bill, introduced by Reps. Ara Hutchinson, R-Ark., and Jim Moran, D-Va., was slated for a fast track, which meant it needed two-thirds majority vote to succeed. The bill was approved by 250-146 but fell nearly 40 votes short of the majority needed.
Privacy has been somewhat of a political football in Congress. The House and Senate have introduced a slew of Internet privacy bills, many of which have gone nowhere. Hutchinson's bill could have the same fate. Some advocacy groups already are criticizing the effort, even though the commission would be the first federal body to review privacy laws in 25 years.
"What we need are legal protections, not more studies," said Andrew Shen, a policy analyst with Washington, D.C.-based EPIC.