Spyware vs. spyware

Even as many online marketing companies struggle to comply with recent federal legislation governing unsolicited commercial e-mail -- spam to you and me -- new state and federal legislation addresses another online blight: spyware. From California to Washington, D.C., lawmakers are lining up for the chance to smack down this bothersome byproduct of online commerce.

There's just one problem. To snuff out surreptitious Web tracking programs, spyware legislation could criminalize many common tools and techniques already in use by companies. At the very least, such regulation could create a patchwork of contradictory laws and legal requirements that will stifle business on the Web. Not exactly the intent of the law.

Loosely applied, spyware refers to the software that monitors computer use or sends information about computer use to a remote computer without consent. Spyware programs range from aboveboard tracking software -- "adware" created by online advertising and behavioral-marketing companies such as DoubleClick Inc. -- to more devious tools like keystroke logging programs, which can glean passwords and sensitive information from users' computers.

Utah is the only state so far to have enacted spyware legislation. Proposed laws in California, Michigan, New York and Pennsylvania also stipulate that organizations must get explicit authorization from users before installing spyware on their computers. Some proposed laws make failure to do so a criminal offense or allow consumers to seek monetary damages from companies.

At the federal level, both the House and the Senate are wrestling with spyware legislation. In June, the House Committee on Energy and Commerce voted to approve the Securely Protect Yourself Against Cyber Trespass Act (Spy Act), which imposes fines up to US$3 million for a variety of behaviors associated with malicious spyware, such as changing the default homepage on a Web browser, channeling advertisements to the computer and capturing keystrokes. A Senate bill -- the Software Principles Yielding Better Levels of Consumer Knowledge (Spyblock) Act -- also requires consent before installing software on users' computers and collecting information from Internet users. That bill will undergo substantial revisions, however, after representatives from IT vendors and others sound off on the proposed legislation.

Grant Gross contributed to this report from Washington, D.C.