Senators Kerry and McCain Introduce Privacy Bill; Legislation Could Undercut Information Economy

April 12, 2011 — Senators John Kerry (D-MA) and John McCain (R-AZ) today introduced the “Commercial Privacy Bill of Rights of 2011.” The Direct Marketing Association (DMA) remains concerned that legislative proposals regarding the Internet run the risk of undercutting the leading area of American dominance and job growth.

In 2010 alone, companies spent over $25.4 billion on digital advertising, which supported over 3.1 million jobs and generated $503.6 billion in sales. The collection and use of data for marketing and advertising purposes, which fuels the Internet economy, benefits both businesses and consumers, and is, in fact, the cornerstone of what makes direct marketing “direct.” “DMA is wary of any legislation that upsets the information economy without a showing of actual harm to consumers. Information has been a driver of competition in our economy for over 100 years,” said Linda Woolley, DMA’s executive vice president, Washington Operations. “This bill would have wide-ranging effects — not just on the Internet, but on all of the economy, such as retailers, banks, hotels, and mailers.”

DMA continues to express concern that legislation would impose untold regulatory compliance costs on businesses without a showing that there is a market failure or a need to regulate — and does not believe that the case has been made that consumers have been harmed.

With its forty-year history of strong and effective self-regulation, DMA’s efforts now incorporate the broad industry-developed Online Behavioral Advertising program. The Advertising Option Icon gives consumers an easy-to-use, transparent way to opt out of having data collected and used for online behavioral advertising. The Icon appears on billions of ads, and consumers can click on it to opt-out, or they can go to www.aboutads.info. Self-regulatory programs such as this could be undermined by the bill since the Federal Trade Commission would have authority to approve and monitor them. This converts self-regulatory efforts to de facto government regulation, and will discourage future self-regulatory efforts.

DMA looks forward to continued conversation with the Senators and their staffs to ensure that any legislation safeguards the growth of the Internet and the technological innovation that drives the US economy.

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About Direct Marketing Association (DMA)

The Direct Marketing Association (www.the-dma.org) is the leading global trade association of businesses and nonprofit organizations using and supporting multichannel direct marketing tools and techniques. DMA advocates standards for responsible marketing, promotes relevance as the key to reaching consumers with desirable offers, and provides cutting-edge research, education, and networking opportunities to improve results throughout the end-to-end direct marketing process. Founded in 1917, DMA today represents companies from dozens of vertical industries in the US and 48 other nations, including nearly half of the Fortune 100 companies, as well as nonprofit organizations.

In 2010, marketers – commercial and nonprofit – spent $153.3 billion on direct marketing, which accounted for 54.2% of all ad expenditures in the United States. Measured against total US sales, these advertising expenditures generated approximately $1.798 trillion in incremental sales. In 2010, direct marketing accounted for 8.3% of total US gross domestic product. Also in 2010, there were 1.4 million direct marketing employees in the US. Their collective sales efforts directly supported 8.4 million other jobs, accounting for a total of 9.8 million US jobs.

The Power of Direct: Relevance. Responsibility. Results.

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