A variety of social, legal and political issues arise from the interaction of the public's potential expectation of privacy and the collection and dissemination of data by businesses or merchants.
Corporations may be inclined to share data for commercial advantage and fail to officially recognize it as sensitive to avoid legal liability in the chance that lapses of security may occur.
Modern consumer privacy law originated from telecom regulation when it was recognized that a telephone company had access to unprecedented levels of information.
Corporations may be inclined to share data for commercial advantage and fail to officially recognize it as sensitive to avoid legal liability in the chance that lapses of security may occur.
[7] Some services—notably telecommunications, including Internet—require collecting a vast array of information about users' activities in the course of business, and may also require consultation of these data to prepare bills.
Such common commercial measures as software-based customer relationship management, rewards programs, and target marketing tend to drastically increase the amount of information gathered (and sometimes shared).
[citation needed] Concerns have led to consumer privacy laws in most countries, especially in the European Union,[8] Australia, New Zealand and Canada.
[9][10] Modern consumer privacy law originated from telecom regulation when it was recognized that a telephone company—especially a monopoly (known in many nations as a PTT)—had access to unprecedented levels of information: the direct customer's communication habits and correspondents and the data of those who shared the household.
Accordingly, strong rules on operator behaviour, customer confidentiality, records keeping and destruction were enforced on telephone companies in every country.
Customer trust and goodwill were generally thought to be sufficient in first-world countries, notably the United States, to ensure the protection of truly sensitive data; caveat emptor was applied in these situations.
But in the 1980s, smaller organizations also began to get access to computer hardware and software, and these simply did not have the procedures or personnel or expertise, nor less the time, to take rigorous measures to protect their customers.
[citation needed][12] Through the 1990s, the proliferation of mobile telecom, the introduction of customer relationship management, and the use of the Internet in developed nations brought the situation to the forefront, and most countries had to implement strong consumer privacy laws, often over the objections of business.
In Austria around the 1990s, the mere mention of a client's name in a semi-public social setting was enough to earn a junior bank executive a stiff jail sentence.