McGraw-Hill announces own self-controls Publisher joins trend as regulators consider protection on intrusions; Privacy

WASHINGTON — WASHINGTON -- McGraw-Hill Cos. yesterday became the latest company to announce its own set of regulations that protect consumer privacy on the Internet, as federal regulators continue their hearings to determine whether government should step in and establish such guidelines.

During the second day of a four-day hearing, McGraw-Hill Chairman and Chief Executive Joseph L. Dionne told the Federal Trade Commission that the publisher's new policy could serve as a model for other companies and an alternative to government regulation.


"We believe that a policy of comprehensive industry self-regulation can effectively address consumer privacy concerns," Dionne said.

McGraw-Hill's plan allows visitors to one of its Web sites to specify that personal information given shouldn't be put on direct-marketing lists shared with other companies. The plan also erects walls between some of the publishing giant's own units.


McGraw-Hill's policy came a day after Lexis-Nexis and other operators of electronic databases announced their own set of industrywide self-regulatory practices.

And, Microsoft Corp. and Netscape Communications Corp. announced yesterday that they would create a software standard that places limits on how Internet Web site managers can collect and reuse information.

These efforts met with praise from FTC officials.

"If all other companies were like yours, we'd be out of business, happily," FTC Commissioner Christine Varney told McGraw-Hill's Dionne.

Growing concerns about consumer privacy on the burgeoning Internet have led federal lawmakers to consider establishing a set of standards governing privacy so that sensitive personal information such as e-mail addresses, phone numbers -- even social security numbers -- are protected from mass distribution.

The FTC is hearing testimony from consumer and industry leaders before it drafts recommendations for Congress, which is considering several bills addressing online privacy. Other witnesses praised McGraw-Hill's policies, but pointed out that the companies coming forward with privacy guidelines are not the ones that need to be regulated.

"Self-regulation only binds the good guys," said Janlori Goldman, a visiting professor with Georgetown University's law school. "There are a number of companies who don't look at this as an ethical issue. It's really the smaller and newer companies that don't have a good name they have to protect."

Another witness, Peter Harter, global policy counsel for Netscape, talked about the improved privacy capabilities of the company's new Netscape software. It allows customers to screen out Web sites that use information-gathering devices, known in the industry as "cookies."


Harter acknowledged that the software would not block cookies unless the user sets the program to do so.

Several representatives from industry associations also testified, detailing guidelines that their member companies have begun adopting.

Robert Wientzen, president of the Direct Marketing Association, said that "companies that want to build businesses on the Internet must have consumers' confidence if they want to succeed."

The association's guidelines are not mandatory, and he could not tell the FTC how many companies actually are following the suggested rules.

On Tuesday, the FTC heard from electronic database companies about their efforts at self-regulation.

At a similar hearing a year ago, the agency decided to let the industry to police itself. Outcry over online privacy has grown increasingly vocal since then.


Pub Date: 6/12/97