Companies use privacy policies to disclose the kinds of information they collect and what they do with that information, but studies show that the public largely ignores—or misunderstands—privacy policies because of confusing language.

Less than half of those who had read Facebook’s (FB) and Google’s (GOOG) privacy policies understood them, according to a survey by Siegel + Gale, an ad consulting company.

Photograph by Pgiam/Getty Images

Companies use privacy policies to disclose the kinds of information they collect and what they do with that information, but studies show that the public largely ignores—or misunderstands—privacy policies because of confusing language.

Less than half of those who had read Facebook’s (FB) and Google’s (GOOG) privacy policies understood them, according to a survey by Siegel + Gale, an ad consulting company.

Photograph by Pgiam/Getty Images

Facebook, Google, and the Jargon of Privacy Policies

Privacy Policies
Privacy Policies

Companies use privacy policies to disclose the kinds of information they collect and what they do with that information, but studies show that the public largely ignores—or misunderstands—privacy policies because of confusing language.

Less than half of those who had read Facebook’s (FB) and Google’s (GOOG) privacy policies understood them, according to a survey by Siegel + Gale, an ad consulting company.

Photograph by Pgiam/Getty Images
Mobile Devices
Mobile Devices

Consumers are increasingly concerned as to whether their mobile devices and app-makers adequately protect their privacy. A survey last year by the Pew Internet Project found that 57 percent of cell phone owners had uninstalled or declined to install an app because of privacy concerns.

Photograph by Nelson Ching/Bloomberg
Don’t Track Me!
Don’t Track Me!

The same survey found that 19 percent of cell phone owners had turned off the location-tracking feature on their phones.

Photograph by Gw. Nam/Getty
The FTC Suggests …
The FTC Suggests …

In February, the Federal Trade Commission issued guidelines for mobile app developers that encourage them to make privacy policies available and to use “just-in-time” notifications that pop up on phone screens to get consumers' consent before collecting personal information.

Photograph by Will Ireland/Getty Images
The Stick
The Stick

The Federal Trade Commission has reached a number of settlements over the past two years with Internet companies—including Google, Facebook, and Myspace (NWS)—regarding privacy violations. In one of the most recent cases, the FTC said that Path, a social-networking service for mobile devices, had violated laws intended to protect children. Path paid an $800,000 penalty.

Photograph by Tony Avelar/Bloomberg
Audits
Audits

As part of their settlements, Path, Google, Facebook, and Myspace must submit to independent audits of their privacy practices. PricewaterhouseCoopers and KPMG are among the third-party firms that conduct the audits.

Photograph by Scott Eells/bloomberg
But Do They Work?
But Do They Work?

Privacy groups such as the Electronic Frontier Foundation and Center for Digital Democracy criticize the audits as being ineffective at keeping companies from violating the privacy of users.

Photograph by Richard I'Anson/Getty Images