One Step Forward, Two Steps Back? Critical Observations on the Proposed Reform of the EU Data Protection Framework
Journal of Law and Economic Regulation, Vol. 6, No. 1 (Serial No. 11), May 2013, pp. 57-84
Europa Working Series Paper No. 2013/7
23 Pages Posted: 5 May 2013 Last revised: 4 Jul 2014
Date Written: April 28, 2013
Recent changes in market dynamics of electronic and mobile commerce mean that users of online services are no longer “passive agents of consumption”. Instead online business models increasingly provide a platform for user interaction while simultaneously relying on the contributions made by those users for the population of those spaces. Like many other online services that form part of the Web 2.0 economy, SNS, in the main, are offered free at the point of access. Instead of charging their users a monetary fee, most SNS providers generate revenue through payments they receive from third parties in exchange for the right directly to display advertising to their users or in exchange for providing aggregated data on those users’ behaviour, likes and dislikes. This means that users now “pay’” for online services with the personal information they disclose. Despite repeated announcements by members of the SNS industry that they are committed to the protection of their users’ online privacy, it can therefore not be denied that, in practice, a high level of privacy protection is likely to be in stark conflict with SNS providers’ business objectives and that, in reality, most SNS providers are entirely dependent for their market position on promoting an environment that encourages “openness” and widespread information-sharing by their users through the use of default privacy settings and the subtle encouragement of maximum disclosure in the form of financial and non-financial incentives (for example, additional “free” functionality). This article will examine the implications of these technical, economical and social developments of internet users’ rights to privacy under the current EU data protection framework and whether the changes to that framework proposed by the European Commission in 2012 are likely to address the policy issues identified.
Keywords: privacy, data protection, consent, legitimate interest condition, social networking
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