Heritage Foundation Leadership for America

REGULATION IN BRIEF: 
Spyware Regulation

October 04, 2004            No. 18

Background:  Increasingly, Americans surfing the Web find that they have picked up uninvited visitors in the form of programs that install themselves on their PCs—resetting home pages, adding new toolbars, “hijacking” browsers to unwanted websites, and sometimes even mining PCs for personal information. Often these programs are generically called “spyware,” although that term actually refers just to software that takes personal information from a PC. Some analysts fear that Internet pests may ultimately slow the growth of the Internet, as users become frustrated and lose confidence in the Web.

Status:  Congress is looking at a number of proposals aimed at stopping Internet pests. These include H.R. 2929, approved by the House Energy and Commerce Committee in July, and S. 2145, approved by the Senate Commerce Committee on September 22. These bills, among other things, ban specific practices such as browser diversions and surreptitious installation of software. H.R. 4661 is more limited, largely increasing penalties for activities that violate current fraud and privacy protection laws, or those performed with intent to defraud.

Discussion:  Despite the problems presented by Internet pests, there is reason for concern about the pending legislation. Many legitimate Internet services—such as automatic software updating and even content filters to protect children—depend upon transfer of information between users and outside parties and the installation of programs. Overly restrictive legislation could cripple such functions. Even if activities are allowed with consent, users could end up being bombarded with countless pop-up “notifications.”Worse, given the dynamic nature of the Internet, any restrictions could inadvertently impede innovations not even yet conceived.

A better solution to these Internet problems is coming from the private sector. There is already a large array of programs available to consumers—many free of charge—that clean PCs of pests and protect against future invaders. Internet service providers such as Earthlink and search engines such as Yahoo are competing to come up with spyware blockers to protect their customers. Such programs, while unfamiliar to many consumers today, may soon become as ubitiqutious as virus protection and anti-spam programs are now.

Action item: Policymakers in Washington should allow time for these private solutions to develop, while vigorously enforcing current laws, before rushing in with new rules for the Internet.

This brief was prepared by Heritage Research Fellow James L. Gattuso.

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