If consumers have a right to see their own credit reports, shouldn't they be allowed to view the usage data that software application vendors collect about them, and how it is shared? If Palm wanted to regain its users' trust, it could offer to provide access to the detailed usage logs it collects from Pre customers -- say, once a year, upon request. In addition, it could provide a log of every transaction between Palm and its developer partners so that users could know when and where the data they have disclosed to Palm is being shared with third parties.
Would such a plan be too cumbersome? Too difficult to implement? Hardly. Five years ago it might have been easy for software vendors to brush off such a suggestion, but today such complaints just sound disingenuous. The more it becomes apparent that vendors like Palm are compiling individually identifiable user data at this level of granularity anyway, the less comfortable customers will be with that data exchange remaining a one-way street.
The alternative is simple: regulation. The FCRA didn't come out of nowhere. The credit industry had to be dragged kicking and screaming toward transparency. So did corporate accounting -- and we all know the impact Sarbanes-Oxley compliance has had on enterprise IT. Do we really want new, blanket legislation regulating how providers of Internet-based software and services do business?
If the answer is no, then now is the time for action. The software industry must shed its complacent -- or conniving -- attitude toward customer data privacy. It's irresponsible to gather ever-increasing volumes of user data if we are not also leading the charge in developing new technologies to protect that data. Software vendors should also work to be more candid, upfront, and direct about the ways in which user data will be collected, used, and shared -- not hide such policies among pages of legal boilerplate. Providers of online software and services have a right to conduct business as they choose -- but they also have the responsibility to deal with customers with the honesty and fairness each of us deserves.