although i cannot monitor him every waking moment and prohibit his ability to access the internet, nor would i want to, like any parent i want to trust he will be safe to surf on line and interact with his friends without unknowingly be monitored or profiled. while he is in a vulnerable demographic, millions of americans of all ages spend time surfing, posting, and shopping on the internet. how their information is used and what control the individual has over the collection of the information is at the center of debate of whether we need a federal privacy laws. if so, how it should be structured and what activities it will address. in the case of my son, i am concerned with the information being gathered and how it is used. i am also concerned with who is conducting the behavioral profiling on what technology they are using. i think the witnesses today and look forward to your testimony, particularly hearing more about

what the industry is doing to address many of these concerns in and of itself. mr. chairman, i am ready to work with youth and the stakeholders to dress and identify problems and ensure whatever solutions develop will equally applied to the behavior regardless of who engages in it. thank you, mr. chairman. . >> a thank you to mr. sterns and his staff for the excellent

cooperation we've had among ourselves as the plans for this joint hearing of our two subcommittees have progressed. i very much look forward to our continued collaboration as we continue the need for legislation and discuss the principles that privacy protection legislation should embody. -- are primary drivers of the national economy and it's fundamentally in the nation's interest to encourage their expanded use. one clear way congress can promote greater use of the internet for access to information, for electronic commerce and for entertainment is to ensure that internet yearses have a high degree of privacy protection. including transparency about information, collection, practices and uses and control over the use of the information that is collected from those who use the internet. i previously announced my desire

to work with chairman waxman -- in order to develop legislation this year. extending to internet users the assurance that their online experience will be more secure. such a measure would be a driver of greater levels of internet uses such as electronic commerce, not a hindrance to them. avenue general advertising and ways to enhance consumer protection in association with it. i'm a supporter and a beneficiary of targeted advertising. i would much prefer to receive internet advertisements that are truly relevant to my particular interests in. fact, i have bought a significant number of items based upon targeted advertising delivered to me from websites that i frequently visit. and so i have a deep appreciation of the value of targeted advertising from the consumer's perspective. it's important to note also that

online advertising supports much of the commercial content, applications and services that are available to internet users without charge. and i have no intention of doing anything that would disrupt that very successful, in fact essential business model for internet-based companies. at the same time, i think consumers are entitled to some baseline protections in the online space. consumers should be given clear, concise information in an easy to find privacy policy about what information a web site collects about them, how that information is used, how long it is stored, how it's stored, what happens to it when it's no longer stored, and whether it's ever given or sold to third parties. consumers should be able to opt out of first -- of first party use of the information and or

third-party sub said quarters -- without whom the company could not pro advise its service. all of that would fall within the ambit of opt out. consumers should be able to opt in to use of their information by third parties for those party's own marketing purposes. this arrangement should not prove to be burdensome. in fact it's very much in line with the practices of many if not most of the reputable service providers today. i look forward to hearing from our witnesses about their reaction to this arrangement and how it can best balance internet business models that depend on online advertising with adequate protection for consumers' privacy. for example, have i suggested a workable online opt in and opt out consent arrangement? or are there additional situations in which opt out consent might sometimes be appropriate? what safeguards should be in place in order to ensure that consumers are giving meaningful consent to the sharing of their information both on and off the

internet? what role could self-regulatory organizations play in a statutory arrangement that ensures that all entities that collect information about internet users abide by a basic set of consumer privacy standards? i also look forward to learning about emerging approaches to enhancing consumer choice and control over the use of information through efforts like the network advertising initiative and persistent opt out cookies. what benefits could these services offer to consumers? what is the best way to inform consumers about the availability of these services? and again, how should the consumers' meaningful consent be procured? i'm also interested in hearing a purview of what the future of behavior advertising may hold and what services it might enable and how to accommodate privacy concerns associated with those future services. i want to thank our witnesses

for taking the time to join us here today. they represent a broad and diverse range of interests and are all deeply knowledgeable about these subjects. we very much look forward to hearing your testimony. thank you, mr. chairman. >> the chair thanks the gentleman. the chair now recognizes the ranking member of the subcommittee on communications, the ranking member, mr. sterns from florida. he's recognized for five minutes for the purposes of opening statements. >> good morning and thank you, mr. chairman. i also want to echo mr. boucher's comment that we look forward to working together in a bipartisan fashion on a very important bill. i want to thank the witnesses for coming this morning. i think for the most part your going to educate us. you're the experts here. and we respect your opinions. we want to do no harm here. so i think when we look at this

possibility of federal legislation dealing with privacy we want to make sure that it's consumer centric. consumers don't care if you're a search engine or broadband provider. they just want to ensure the privacy -- their assurance that their privacy is protected. we must empower them to make these privacy decisions themselves. and they feel they know how much they want to be collected and whatnot should be collected. congress cannot and should not make that decision for them but it can play a role in making sure consumers have the information simply to make their own choices. that means companies should be as transparent as possible about what information they collect. and of course how they're using it. that way consumers will be better able to make informed privacy decisions. this transparency should include robust disclosure and notice outside the privacy policy. notice and disclosure needs to be clear and conspicuous so the

consumers know that. first some information is being collected. second, what is the information that's being collected? how is it being used? and third, how to prevent this information being collected if they so desire. by giving the consumer more robust and transparent information, we can strike the proper balance between privacy protection and strong internet commerce. further more, my colleagues, i want to emphasize two principles that should play a prominent role in our examination of this issue. first we should apply the same privacy standards to companies that are engaged in similar conduct with similar information. but we should avoid applying those same standards to entities that do not use the same types of information for the same purposes and do not have anywhere near the same volume of information about the prospective consumer. for example, search engines in internet advertising networks may use a consumer's visit to a

particular web site to create profiles for purpose -- for purposes not directly related to the reason for the visit. other entities like web push letterers collect information only to provide the very service the consumer has come for. our approach should recognize. that. second, any legislation in this area should hold only for that which they know and control. we should be wary of efforts to make any one party responsible for the actions of others. consumers online activities provide advertisers with valuable information upon which to market their products and their services. collecting this type of information for targeted advertising is very important because it simply allows many of these products and services to remain free to consume information, websites would either have to cut back on their free information and services

would have to start charging a fee. neither result is good for the consumers. overreaching privacy regulation could have a significant negative economic impact at a time when many businesses in our economy are struggling. so let's be very cerful on these issues before we leap to legislative regulatory proposals. when i was chairman of the commerce consumer protection and trade i held a number of hearings on privacies. i worked with chairman boucher and we developed the consumer privacy protection act which we drafted as a bill. this bill would have required data collectors to provide consumers with information on the entity collecting the information and the purposes for which the information was being collected. i believe it was and still is a good base bill to use as we make -- as a move forward to develop a new privacy bill. also i'd like to bring up an issue perhaps that many of us have thought about. and i don't want to bog down our discussion about it. which agency will regulate and

enforce privacy standards? will it be the f.c.c. or the federal trade commission? a combination or possibly a new agency? i know this issue won't be solved this morning. but it's something we're going to have to work out and work through. and i look forward to doing this on a bipartisan fashion. and i'd be interested if possible if some of the witnesses could give us their feelings about how the jurisdiction of this privacy bill would be best supervised with. so mr. chairman, i would conclude by pointing out we've talked a little bit in previous hearings about deep pocket inspection. the point is that whether a company uses deep pocket inspection or reads your e-mail direct of the privacy rules in some way. so i think witnesses can also help us on that particular aspect. so i look forward to hearing and thank you for the opportunity to speak. >> the chair thanks the gentleman.

the chair now recognizes the gentleman from ohio, mr. space, for twomans for the purposes of opening statements. >> thank you, chairman rush and chairman boucher, ranking member ra done very much and ranking member -- radonovich and ranking member sterns. >> i was struck by -- "responsible ad services typically collect less information and track users less intensively than the technology would allow him to quote" to me this means that just because we can doesn't mean that we should. i certainly understand a need for companies to advertise on their sites. doing so is what enables our constituents to access free content, products and services online. they also understand the desire of ad companies to provide consumers with that are of morel advance to them. this is a better business model for the companies and potentially a service to consumers.

however, i want to make clear that one bad apple could spoil the whole bunch here. the moment online consumers believe their personal information is at risk orf of corruption, misuse or theft will be the moment this approach we're discussing today will cease to work. i strongly believe it is in the interests of all parties to disclose to the consumers their advertising practices and intent and to ensure the consumer's personal information is strictly guarded against security breaches and exploitation. i look forward to these conversations today and to working with my colleagues on this issue as we move forward. i yield back my time. >> the chair thanks the gentleman. it is now my pleasure and honor to recognize for five minutes for the purposes of opening statements the ranking member of the full committee on enaur and commerce, mr. barton is recognized for five minutes. >> thank you, mr. champ. the look on the other side of the aisle i am glad to see none

of the democrats who played on the democratic baseball team are actually in the room. [laughter] >> so i can congratulate them in their absence. and i won't have to do it face-to-face when i see them on the floor. [laughter] >> but last night mike doyle who is the manager of the team, bart stupak who is on this committee, played an amazing game. it wasn't their usual democratic bum blinker error game. [laughter] they actually played very well. and as a team. and as a result, they beat the stall wart republicans 15-10. john chimkus who is our starting pitcher played an excellent game. and we had a number of energy and commerce republicans, mr. gingrich, dr. gingrich who is here, walked at a key time and later scored. mr. skalise who is here played second base some. and also did some base running and scored.

so mr. pitts who he came out and watched the game. [laughter] >> and luckily didn't try to play. although we could have used his bombing skills from the vietnam war. so any way, we raised quite a bit of money for charity and had a good time. and we now see mike doyle and you see that he's grinning from ear to ear, just congratulate him and tell him to take pity on the downtrodden republicans who didn't quite have the stuff last night. [laughter] >> on this hearing, mr. chairman, i do want to thank you, thank mr. boucher, mr. sterns, mr. rodanovich, for working in a bipartisan fashion to protect the privacy and security of every american's personal information. i'm glad that we are working on this in a bipartisan way. i especially appreciate chairman

roush's agreement to act on the republicans' data security bill. that bill has implications for the broader privacy discussion, and i hope that that bill will move forward in the full committee. along with congressman markee, i cochair the congressional privacy caucuses. so i'm glad that we are working on these issues in a bipartisan way. i myself every few days hit the delete button and clean out all the various cookies on the computers that are in my office and at my home. it's amazing to me how many of those accumulate. and most of the time without absolutely any knowledge of myself or anybody else for that matter that they're being put on our deal if somebody tracks where you go and what you look at without your personal

approval. we wouldn't like that in the non-internet world. and i personally don't like it in the internet world. the information about myself is mine unless i choose to share it i would just as soon that it stay my information only. i think that i have the right to know what information people are gathering about me and the right to know what they're doing with it. it's obvious nat public agrees with the statement that i just made because poll after poll shows that they think that their information and their right to privacy is just as important on the internet as it is in the non-internet world. when i open an e-mail for the new dallas cowboys stadium that is in my congressional district, i don't expect to begin receiving unsolicited ads for airline tickets to the dallas-fort worth area or hotels also in my district in

arlington, texas. it's obvious that people track what i do and where i go. and try to take advantage of that. fortunately, technology has come quite a ways in protecting individuals. we started looking at the spy wear problem back in the 107th congress. and thanks to the work of among others congressman mariano mac, ed towns, chairman dingle, those spy wear infections are not near the problem that they used to be. however, today companies continue to gather, maintain and use data to a variety of technological methods. some of those companies such as verizon and comcast are large companies. they're regulated in some parts of their business model. and i think they are trying to act appropriately. there are other companies, so-called isp low cadeers, that

we don't -- locaters that i personally don't even know their name. then you have the in between companies, the so-called edge companies like yahoo! and google. put together, it still is a little bit of a wild west out there. and i think it's time that congress begin to look at that and try to bring some law and order into that particular wild west area. i see that my time has expired, mr. chairman. so i'll submit the rest of the statement for the record. suffice it to say that i'm glad that you and congressman boucher are working with the republicans in taking a serious look at this. i also want to commend the private sector that's here today. it's my understanding that you're working together to come up with some voluntary rules. and it is always preferable in my opinion to do it through a voluntary market-based approach as opposed to a mandatory regulatory approach. so in any event, again, thank

you, mr. chairman. and once again, congratulations to the democrats for winning the baseball game last night. i yield back. >> the chair thanks the ranking member. it is now my honor to recognize the gentle lady from california for two minutes for the purposes of opening statements. ms. matsui. >> thank you, mr. chairman. i want to thank you and chairman rush for calling today's joint hearing and applaud your leadership in addressing this important issue. i'd also like to thank our panelists for being here with us this morning. today we are here to examine the practices and consumer protections from a growing online advertisement practice known as behavior advertising. as broad-band access continues to expand across this country, more and more americans are relying on the internet for news information, online videos, and to purchase goods and services.

and americans need to have trust and confidence that their personal information will be properly protected. privacy policies and disclosures should be clear and transparent so consumers can choose what information they want to view and receive on the internet instead of inappropriate collection and misuse of their information. consumers should also understand the scope of the information that's being collected. what it's being used for, the length of time it's being retained and its security. the more information that consumers have the better. moving forward we must ensure that americans are comfortable with using the internet and know with confidence that meaningful privacy safeguards are in place while ensuring that we don't stifle innovation. i thank you, both of you, mr. chairmans, for holding this information hearing today and i yield back the balance of my time. >> the chair thanks the gentle lady. now the chair recognizes the

gentleman from kentucky. mr. whitfield for five minutes for the purposes of -- let me correct that. the chair recognizes a gentleman. >> the chair recognizes the gentleman from michigan. >> i thank my friend. and i'll not take my two minutes. we have great attendance. we'll see what the attendance is after lunch. we'll return after these votes. i would like to associate myself with mr. barton's remarks. the information is yours. when you make a phone call no matter who it is, you don't expect at&t or verizon to share the information with somebody else. can you imagine if you ordered a pizza on the phone and all of a sudden you get different pizza companies then coming in knowing that you're going to be subscribing to. that that information is personal. it shouldn't be shared unless that individual allows and knows that it's going to be shared. it needs to be protected.

it's nobody's business. don't expect to have someone follow you in your car when you go make an errand, whether it be to a dry cleaner or wherever you might go, and expect some competitor then to perhaps get the information to trace you back. so this is a great hearing. i look forward to it. and i yield back the balance of my time. >> the chair thanks the gentleman. the chair now recognizes the gentleman from georgia, mr. barrow, for two minutes for the purposes of opening statements. >> i thank the chairman. i'm going to waive my opening but i want to thank the ranking member for his congratulations of the democrats. in solidity of mr. pitts i want to say those of us who sit in the stands and cheer also serve. thank you very much. [laughter] >> the chair now recognizes the gentleman from kentucky,

mr. whitfield, for five minutes. >> thank you, mr. chairman. we certainly appreciate all these witnesses being here today as we explore this very important subject. as online companies use an array of sophisticated and ever evolving data collection and profiling applications, it is important that we focus on protecting privacy. today i think we'll be hearing about privacy policies of various companies, the data retention that they do. and as we proceed and think about legislation, it's imperative that we use a balanced approach and proceed with caution. and i think if we do have any legislation, it certainly should apply equally to all entities throughout the internet eco-system. and i'll yield back the balance of my time. >> the chair now recognizes a gentleman from ohio, mr. pitts.

from pennsylvania, mr. pitts. recognizes for two minutes. >> thank you, mr. chairman. i work real hard in opening statement but i think i'll submit it for the record. just let me say i believe that consumer privacy rights should be carefully guarded. i'm also encouraged by private industry's recent steps to further protect consumers. it's my hope that if legislative action is taken that we'll do so in a careful manner, striking a delicate balance between the necessary steps we must take to protect consumers and the ability for industry to continue to be successful. so with that i'll submit the rest for the record and yield back. >> the chair thanks the gentleman. chair now recognizes the gentleman from georgia, dr. gingrich, for two minutes. for the purposes of open statements. >> chairman rush and chairman boucher, ranking member rodanovich and stearns, i want to thank you for calling this hearing today on the emerging

use of behavior or interest-based advertising online. while this type of advertising only represents a small portion of our online ad, by 2012 this type of advertisement is estimated to reach $4.4 billion in revenue. therefore it is important for these subcommittees to take a further look at this industry and honor that we ensure the privacy of consumers. when you hear testimony from this panel today i believe it will be important that we focus on three components of any potential regulation that these subcommittees propose. first it's important to distinguish what it is that we're going to be regulating. currently most interest-based advertising is conducted through the use of web browser cookies. these encoded text files help indicate an user's online activity, thereby enabling advertisers to customize ads based on a series of preferences. however, as we have seen in the it industry, particularly over

this last decade, technology moves very quickly. if we are to propose regulations for this industry we must make the determination of exactly how and what we are going to regulate. mr. chairman, we must also examine which federal agency would be best suited to coordinate any potential regulation. both the federal communications commission, fcc, and the federal trade commission have jurisdiction over elements of behavior advertising. therefore for the sake of consumers, if regulations are necessary we must coordinate the efforts and responsibilities of these two governmental entities, thereby allowing for industry growth while at the same time safeguarding an individual's private information. lastly, mr. chairman, we would also have to determine whom we would be regulating. would it be the internet service provider or the advertisers or the web interfacing companies represented here today? accordingly, i think it will be important that as we move

forward we diligently take the time to hear from isp companies and advertisers as a way to give us different perspective on this important issue that will continue to be crucial online activity. mr. chairman, the heart of this hearing is the american consumer. so our focus must be their overall protection. i look forward to hearing from the panel. and i yield back the balance of my time. >> the chair thanks the gentleman. the chair now recognizes the gentleman from louisiana, mr. solise, for the purposes of opening statements. >> thank you, mr. chairman. i want to thank you and the ranking members of the subcommittees for having this hearing on behavioral advertising. i'm pleased that those subcommittees are examining this issue as well as the bigger issue of data privacy. i know -- we all know technology continues to advance and develop in ways to provide tremendous benefits to consumers.