sealPurdue News

November 3, 2000

Privacy takes on new meaning when it's online

WEST LAFAYETTE, Ind. – While surveys show that people are quite concerned about privacy in an increasingly wired world, a Purdue University professor says perceptions of privacy vary greatly.

"Privacy means different things to businesses, customers, employers and employees," says Jacquelyn M. Rees, a Krannert School of Management assistant professor.

Having personal information available on the Internet allows banking customers to see all of their accounts online and to transfer funds easily from one account to another, Rees says. But all a hacker needs to grab off the Web is your account number to have access to your bank account.

Rees points out two examples of e-businesses running afoul of consumers. There was the public outcry over DoubleClick's using information obtained by tracking the sites at which people visited and shopped to profile the Web users. More recently, came under criticism for charging customers different prices for the same item, based on information the company had gleaned from the customers' earlier visits.

"Yet, people are willing to give their name and contact information to win a $500 prize at a Web site," Rees says.

"This information is then used to assemble the huge databases that account for the increase in the number of telemarketers," Rees says. "So it's impossible to spend a quiet Saturday morning at home reading the newspapers without being interrupted by telemarketers."

There are some basic, commonsense things people should do to keep their information assets safe.

"You want only properly authorized people to have access to your financial information," Rees says. "When making purchases online, the public should realize that encryption works. The danger is rarely in making the transaction, but rather where your credit card number is stored afterwards.

Rees says savvy e-business companies know that in keeping their customers' records secure, their businesses are at stake. With that in mind, online consumers should do business with established e-businesses and use some of the secure third-party online payment systems that have recently become available through both new online services and traditional financial companies expanding their presence to the Web.

"These businesses recognize that there is money to be made on balancing people's perception of privacy with the convenience the Internet offers," Rees says.

She also recommends using just one credit card for the Web to make tracking easier. It's simpler and less confusing to examine one credit card statement per month for suspicious account activity than a half-dozen.

Personal health information is another area of concern. "Companies are tracking user visits to health-related Web sites, just like they do for other commercial sites. Often, companies can identify individual visitors to these sites and also what information the visitor accesses there.

"For example, a company can request that visitors fill out a registration form and record each link a visitor follows and how long he or she remains at each site. This information is typically used for marketing purposes, but it could conceivably be passed along to insurance companies."

She says this is not happening yet, but it is not beyond the realm of possibility. And while Rees terms the situation "unnerving," she acknowledges that basing a person's medical insurance rates on a medical condition is fairer to an insurance company's other customers. On the other hand, that argument goes against the long-held idea of insurance companies' keeping customers' costs down by spreading out the risk.

Privacy will never be what it once was, Rees says. But with a few precautions, people can take advantage of the convenience of the wired world without losing sleep over the potential dangers lurking on the Internet.

Source: Jacquelyn M. Rees, (765) 494-0320,

Writer: J. Michael Lillich, (765) 494-2077,

Purdue News Service: (765) 494-2096;

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