Examination of Witnesses (Questions 220
WEDNESDAY 23 FEBRUARY 2000
220. Yet they do have something which is concerning
a great many people. Coming back to your papers about the nature
of the business you run, you say that you know and understand
your audience, "The way in which Silicon.com was built means
it accurately measures a) who its users are and b) what these
users do on site." Could you say how you do that and do you
do it with the permission of the people who come to you?
(Ms Russell) Yes. We are registered with the Data
Protection Registrar, it is called permission marketing. They
come into the service and register for the service. If they register
for the service they do so on the understanding that we are registered
with the Data Protection Registrar and that we do not pass on
information to third parties without their permission and they
have the option to opt out of that or, as the Act requires, to
make a positive choice to have their information passed on.
221. Leaving aside whether or not people understand
they entered into that contract, on balance would you prefer to
have the Data Protection Act in existence or would you prefer
the total freedom, like in the United States, where there is a
great deal of concern about cookies.
(Ms Russell) From a commercial point of view it would
be better to have the same situation as there is in United States,
without question. From a personal point of view there is a need
for regulation, however, it is essential that that regulation
is clear and accessible to businesses. Also the issue about the
US is an important one because there are many businesses like
ours beginning to operate on a global stage. It is very hard for
us to make sure that we are compliant across Europe and across
the United States as well. It is very tempting for businesses
like ours to potentially relocate to the United States, although
it is not something that we have considered, however, I can see
why a business might want to do that.
222. Are you conscious that there is pressure
in the United States for change?
(Ms Russell) Absolutely. There has been a lot of upset
over various things that have happened. Double-Click, which is
an on-line service company recently acquiredI forget the
name of the market research companywhere they are able
to match up databases and target individual consumers. That is
without their knowledge, which a lot of people are unhappy about,
and justifiably so.
223. Miss Ussher, do you want to comment on
any of these points?
(Ms Ussher) I would like to comment on the last point.
In the United States, there is not a completely unbridled free
market in personal data because there is a self-regulation scheme.
No one is suggesting that industry and companies can do whatever
they want. There is a scheme that is run by TrustE. I do not know
if you are familiar with that. I am sure you are. What has happened
in the last couple of weeks is that the European side of TrustEthey
expanded into Europe last yearhas incorporated the EC guidelines
into its kite mark scheme. What they are going to set up is a
dual or even a three level scheme where some businesses can just
register for the TrustE in Europe, some in the United States and
some for both. What they found is that consumers do follow this
kite mark and will prefer to trade with web sites that have that
seal of approval.
224. First of all, may I say that your answers
have been very frank and impressive. It is nice to read some frank
answers. In your paper you say there should be a political heavyweight
in charge of IT. The United Kingdom Government has a Minister
of State in charge and a very senior Civil Servant can be required
and there is a Commissioner in Europe, is it heavy enough or would
you like to see it heavier than that?
(Ms Russell) Heavier than that. You are referring
to Alex Allan and Patricia Hewitt, presumably, and the roles which
they play in the United Kingdom Government. With no disrespect
to them I think it needs to be placed much higher up the agenda.
The perception amongst business, we had a panel debate which consisted
of an ex-director of IPC, the head of Certus (which is an organisation
of IT directors), David Taylor, and Martin O'Neill, who is a Scottish
MP. What was your question, I cannot remember.
(Ms Russell) What came out of that was that they felt
that there was a lot of talk and using it for good PR opportunities,
talking about the Internet and putting e-commerce high up the
agenda and their experience working in industry and also, interestingly,
from the MP who was present was there was not any real action
and substance behind it. There was high praise for Patricia Hewitt
but they felt she did hot have enough heavyweight backing.
226. Are you really saying there should be a
Minister dedicated to this and only this subject?
(Ms Russell) It should be a Minister in charge of
the Internet, e-commerce, IT or something to cover all of that
which is of a high status. There should be a powerful person in
227. Is what you are saying, there should be
a Minister in charge of this because it is a subject large enough.
(Ms Russell) Absolutely.
228. I am very confused because on the one hand
you are saying that regulation is the death of the industry and
it will strangle it in effect and on the other you are saying
there is not a heavyweight enough minister and there ought to
be a minister in charge of the Internet. You are also saying there
has got to be the Data Protection Act and there are problems in
United States. What area would you not like regulated? There are
certain areas you definitely think need regulating. Can you just
tell us which areas you do not think need regulating that you
think we are going to regulate?
(Ms Russell) I am going on feedback from people that
use the service and colleagues and I think it is more to do with
a lack of understanding about regulation and how that translates
into a business context.
229. Lack of understanding by who?
(Ms Russell) By business.
230. By your colleagues who are using this?
(Ms Russell) By them and by industry as a whole when
it comes to issues like data protection, in particular.
231. Although your opening statement indicated
that you might like a free for all you are not really into that
at all. You think that there have to be some parameters, some
constraints, do you not?
(Ms Russell) Absolutely.
232. Can you just tell me the areas where you
think you would like a free for all?
(Ms Russell) Not off the top of my head, no.
Lord Bradshaw: We have a Financial Services
and Markets Bill before the House at the moment and it is very
easy for many people to say "To hell with regulation"
and that will get a cheer from lots of people. I think those of
us who have to deal with the Bill in the House feel that we are
damned if we do and we are damned if we do not and I think it
is up to people like yourself who have a much better understanding
of e-commerce than we do, because we are of a different generation,
if I might put it like that
Baroness O'Cathain: Come on!
233. Maybe not Baroness O'Cathain, but it is
something which many people like yourselves have grown-up with
and you are much more used to than we are and you are used to
the language. What we do want to know is will you look at the
Bill, will you look at yesterday's debate and will you make very
clear what you think ought to be done? That is really what I am
saying to you.
(Ms Russell) About the Bill that you are referring
Lord Bradshaw: There is a debate on the Bill
which is coming into Committee stage and which we will be called
upon to debate and amend if we think it is necessary.
Baroness O'Cathain: It is not the Financial
Services and Markets Bill, it is the E-Communications Bill.
234. Will you look at what is proposed and make
clear what you think ought to be done about regulation and any
other features of the Bill which you would like to see included
in it as amendments?
(Ms Russell) Yes.
235. We can give you time to reflect on this.
(Ms Russell) I cannot answer that now. That will obviously
take time to do.
Chairman: We read your paper and then we say
"Can you give us examples, please?".
Lord Bradshaw: It is the Electronic Communications
236. If you feel you would like to supplement
your paper and put something in writing to us, we would be very
happy indeed to hear further from you rather than press it too
(Ms Russell) Yes.
Lord Woolmar of Leeds
237. Looking across the nation states of the
EU, in which countries do your members feel the non-regulatory
regimes are most helpful to the growth of e-commerce and in which
states do you think they are least helpful and in both cases could
you give specific examples of why? It may be that you are principally
focused on the UK, of course.
(Ms Russell) I can give a broad-brush answer. I cannot
give huge amounts of specific detail because I do not have sufficient
knowledge of every single Member State. I think certainly the
Scandinavian countries, Norway and Sweden, are leaders in this
field. I think the UK is a strong leader as well, tier one, closely
followed by Germany and then France, Italy and Spain.
238. You probably feel we are neglecting you,
Ms Ussher. Would you like to make a comment as well?
(Ms Ussher) Not on that one.
Chairman: We will come to you later. You are
not going to be neglected.
239. My question is to either or both of you.
We recently did an inquiry into SMEs and presumably you are talking
about your users being SMEs and you are an SME, presumably.
(Ms Russell) Not all are SMEs.