Remarks at Privacy and Innovation Symposium

Secretary of Commerce Gary Locke
Leesburg, Virginia
May 07, 2010

Thank you for the kind words, Larry. Good morning everyone.

 

I want to join in welcoming you to our Privacy and Innovation Symposium.

I’d like to give special thanks to the superb group of panelists who are joining us—many of whom have traveled across the country to engage in this important dialogue.

And thank you to those government officials—from the FTC, the State Department and the White House—who are helping to lead the conversation.

We’ve invited you today to address a compelling challenge: How do we on the one hand ensure that the Internet continues to grow as a platform for innovation and commerce in the United States and around the world, while at the same time protecting personal privacy?

Every day, millions of Americans shop, sell, bank, learn, talk and work online. As a society, we are more dependent on the Internet than ever before.

As a result, the Internet is unparalleled in its ability to drive U.S. innovation and economic growth.

A new study was just released showing that between 1998 and 2008, the number of domestic IT jobs grew by 26 percent, four times faster than U.S. employment as a whole. By 2018, IT employment is expected to grow by another 22 percent.

The Internet is not only a source of tremendous past and future job growth. It is also a driver of global commerce.

According to private researchers, global online transactions are currently estimated to total $10 trillion. Almost any transaction you can think of can now be done online—from consumers paying their utility bills and people buying books, movies and clothes, to major corporations paying their vendors and selling to their customers. And these same researchers predict that by 2020, global online transactions will exceed $24 trillion.

This is transformational not only in terms of the size of e-commerce, but in the evolving way in which we use the Internet.

In the coming years, we will continue to see rapid growth in the diversity of applications, services and devices.

  • Single purpose “smart appliances” – like smart air conditioners – will connect to the smart grid.
  • Several companies are creating global “cloud computing” systems, which will offer on-demand, super-computing capacity.
  • A decade ago, going online meant accessing the Internet on a computer in your home. Today, it also includes iPhones, portable games, and interactive TVs.

Simply stated, the Internet is becoming the central nervous system of our information economy and society.

As powerful, exciting, and innovative as these developments are, they also bring with them new worries.

For example, through these devices and applications, many companies are actively collecting personal information and then using it to target products and services at consumers.

This can make commerce more efficient and companies more responsive to their customers needs. But it also demands that we strike a balance where privacy implications are addressed.

If we are going to harness the full power of the Internet, we need to establish norms and ground rules that promote innovative uses of information while still respecting consumers’ legitimate privacy interests.

As we go about creating these privacy guidelines, we need to be careful to avoid creating an overly complicated economic and regulation environment.

We need to develop pro-innovation solutions to privacy concerns and to promote harmonization of such laws globally.

Given this challenging reality, we need to take a fresh look at the policy framework that underpins the Internet economy. . . .

. . . We need to ask, are there policy “nudges” that can assure privacy and simultaneously reduce impediments to e-commerce?

To answer this question, a few weeks ago I announced the formation of an Internet Policy Task Force.

The Task Force is made up of senior staff from across different parts of the Commerce Department.

It includes experts in standards, intellectual property, trade and privacy policy, technology, and Internet communications.

As many of you know, last month the Task Force released a formal request for public comment on data privacy issues.

The goal of that request for comments is twofold:

  • First, to determine the impact of domestic and international privacy frameworks on the pace of innovation; and
  • Second, to identify policies that will enhance privacy protection and trust on the Internet.

We are seeking a broad range of participation and welcome frank and honest comments.

The Task Force will analyze stakeholders’ views and in the coming months prepare a report on Privacy and Innovation in the Information Economy.

The dialogue launched here, and the research conducted, will contribute to administration-wide policy positions and global privacy strategy. So I thank you in advance for contributing your thoughts.

To add a bit more context for today, I want to be clear on a fundamental point.

Too often, when this topic is raised by government officials, it is perceived as adversarial; the government versus business—the government looking to force the private sector to do something.

The focus of our debate must be on how the government and the private sector can better address our shared responsibility.

I know, of course, that when it came to cyber security over the last decade, many in the private sector felt the conversation was largely one sided. . . and government was doing most of the talking.

But almost a year ago, the president put out the challenge that the U.S. government collaborate more closely with industry to find solutions that ensure our security and promote our prosperity. In the months since, we have made some good progress. Together, we need to continue to step up our game.

Because the private sector owns and operates the vast majority of the Internet’s infrastructure, and develops the applications and services that move commerce through it, the government is not in a position to prescribe engineering technology solutions.

I encourage the business community to identify industry best practices in the handling of private information online and to share what they have learned with the administration.

We are depending on the same input from consumer groups and privacy advocates to ensure we formulate well-rounded government policies.

In the early 1990s, the Internet was virtually unknown to the general public. Its use was restricted to the government and certain universities.

Twenty years later, the Internet today counts more than one billion users worldwide. It is no longer in start-up mode.

Given the Internet’s new scope and fundamental importance to our future, we need to get privacy policies right.

We need solutions that ensure privacy and promote prosperity.

We need a privacy framework for the 21st century.

So, our shared task is to pull the pieces together into a coherent whole—to help ordinary citizens and Main Street businesses understand that privacy protection is important, and to work together to give Internet users confidence and trust in the information superhighway.

As we collaborate to develop a new privacy framework, I want to thank you again for participating in this symposium.

I look forward to your ongoing engagement with us and other policymakers on this important issue.

Thank you.