Archived—Project Summaries 2007-2008 - Public Interest Advocacy Centre (PIAC)

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1. All in the Data Family? Databases, Children and Profiling

$57,000

Commercial entities are creating websites and other web portals that collect personal information of children and teenagers at an increasing rate: largely social networking and entertainment sites. Prominent examples are MySpace, Facebook, YouTube, eBaumsworld, Addicting Games and Neopets. One concern is the amount of information gathered under these sites in Canada and whether this collection (and any subsequent use and disclosure) has been truly consented to by either the parent or legal guardian, or the minor himself or herself, as required by Canadian privacy laws. A second concern is the effect of the 'data trail' left by minors in their lives as children and subsequently as young adults. Much work is being done on the obvious problems associated with data trails such as stalking of children by adult predators and harassment of children by other children: cyberbullying. However, less attention has been paid to date to the marketing aspect of this relationship and the extent to which children enter the stream of electronic commerce through offering their personal information in exchange for access to these services. There is an emerging possibility that marketers could create a 'cradle to grave' profiling of customers.

One of the primary goals of this study will be to identify social networking sites, gaming and other sites to determine websites in Canada actually being used by Canadian young people and the extent of their use. A multi-pronged research strategy will be employed to gather the primary data. The strategy will include: direct contact with online services; review of sign-up processes and privacy policies of such sites and facilitated focus group interaction with children and young adults. Secondary research by a literature review will also be undertaken.

The study's main goal, however, will be to identify the types of data collected, and the uses and disclosures identified under the privacy policies and compare these to the actual collections, uses and disclosures. To the extent possible, this will yield a view of whether the business model relies upon an accurate statement of privacy rights.

The methodology will consist of the following:

  • Given the sensitivity of children's use of websites, the need for ethical approaches to obtaining children's opinions and the difficulty of obtaining meaningful results with a simple survey, this proposal adopts the focus group as the major vehicle by which children's opinions and understanding of the use of their personal information by these sites can be obtained. The focus groups will question groups of children in the following age/grade brackets; grades 4–7 (ages 9–13) and 8–11 (ages 14–17). The focus groups will be run in English and in French by established survey firms that will follow all required legal and ethical requirements.
  • PIAC will use as a starting point the lists of top 50 websites found in the Media Awareness Network study to determine which companies' privacy policies to examine. The privacy policies of all of these sites will be examined for readability, compliance with Personal Information Protection and Electronic Documents Act and appropriateness for the audience. Other sites will be added after discovery through research. Contact with the affected companies will be initiated at the earliest stages of the process and a copy of this research proposal will be included in the interests of full disclosure. Examination of secondary sources will include Internet research and research from established academic journals on child psychology and sociology.

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2. Are You Sure You Want to Continue? Consumer Authentication at the Crossroads

$38,000

Authentication of consumer identity in online transactions is becoming increasingly crucial as consumers turn to the Internet to shop. Here, consumers must fend off cyber-threats such as phishing and keystroke logging and other hacking attempts to gain access to their online payments. The Principles for Electronic Authentication — A Canadian Framework ("Authentication Principles") came into effect in May 2004. Since then, a number of technological, legal and sociological developments have occurred both in the narrow field of authentication and the wider field of electronic commerce in general.

As a result, Industry Canada recently has reconvened the Authentication Principles Working Group, which was responsible for drafting the initial Authentication Principles. At a June 14, 2006 meeting of the Working Group, it was agreed that there is a need for the Authentication Working Group to review the Authentication Principles with a view to:

  • assessing the need to update the Principles to reflect new authentication environments (e.g., mobile commerce, RFID technology);
  • assessing the need for additional policy instruments to underpin the Principles (e.g., to provide guidance on levels of authentication, risk management, education/awareness tools); and,
  • exploring the relationship of the Principles to the issue of identity management in online environments.

This project will study consumer use of and reaction to, authentication in general and the Authentication Principles in particular. It will provide consumer perspectives on the question of whether there is a need to improve and strengthen the framework for managing authentication in the future.

The methodology will consist of the following:

  • PIAC will conduct a paper review of the Authentication Principles and related working group documents. PIAC also will consult with consumer groups, individual consumers if possible and conduct a literature review on consumer experience with authentication.
  • PIAC will engage a national polling firm to conduct a national survey of consumer experiences with and attitudes to authentication processes in place and consumer issues with authentication systems.
  • Polling results, findings and a draft report will be provided to the Authentication Working Group.
  • PIAC has extensive experience with the Authentication Principles, having sat on the original drafting committee and now on the review committee.

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3. Lenders and consumers in Sub-Prime Lending: An Overview

$65,390

The research will focus on the financial sub-prime lending market in Canada. This is a sector of the supply-side consumer lending industry that targets consumers with damaged, weak or less than prime credit histories, that uses such past performance by debtors as an indication of potential risks involved in a new lending transaction with such consumers. Sub-prime borrowers generally pay higher than the prime rate of interest for a variety of products, from mortgages, car loans, lines of credit, payday loans or cash advances. This research will investigate the nature of the market for sub-prime lending. It will do so first by describing who are main participants in this market, the size of the market, the range of products that constitute the sub-prime lending market in Canada and terms and conditions of these loans. The project will then attempt to identify the market issues associated with success and failure in the market from the standpoint of both lenders and borrowers, as well as other stakeholders such as governments. The study will provide a picture of how this market works, with particular emphasis on flagging symptoms or actual instances of market failure that may have consequences for stakeholders. However, the study will not attempt to evolve a comprehensive framework of policy solutions to address the identified risks at this time.

The methodology would consist of the following:

  • The methodology will involve primary and secondary research. The primary research will consist of determining who is involved in the sub-prime lending market in Canada and conducting interviews with key stakeholders in the financial sector to determine the characteristics of the market. This will be supplemented by substantial secondary research that looks at this emerging market, its operation and the differentiation of sub-prime lending versus prime lending markets.

As primary research on this market including implications to consumers has not yet been conducted in Canada, this initial research will have a positive impact on the understanding that stakeholders, including sub-prime credit users, have of critical issues involving this finance area.

This information will be of benefit to both provincial and federal levels of government involved in financial services, customs and consumer protection, the financial services sector itself, credit counselling agencies who assist individuals dealing with debt issues, consumer groups and anti-poverty organizations.

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4. Representing the Consumer in Broadcasting

$42,900

The Canadian Radio-television and Telecommunications Commission (CRTC) has recently announced its intention to commence a review of the Broadcasting Distribution Undertakings (BDUs) in 2007. These regulations, last reviewed by the CRTC a decade ago, establish the framework within which broadcast distribution undertakings are obligated to offer their services. The BDU regulations touch upon such fundamental issues as program origin, content, subscriber choice, regulation of basic service, content rules, and provision of community programming.

PIAC will review and update its organizational knowledge concerning the existing regulatory framework and will study issues including the following: impacts on quality of service and pricing arising from implementation of the 1997 BDU regulatory framework and the demise of the Cable Standards Council; market analysis of current choice, pricing, and value for service in BDU offerings; customer satisfaction with offerings derived from current framework; community programming including achievement of Commission objectives; overall state of competition and trends.

The methodology will consist of the following:

  • The research question is effectively bound up with the presentation of the consumer's perspective associated with issues such as price, value and choice in BDU services. In addition to the analysis undertaken by PIAC, the study will have the benefit of a survey of consumers of BDU services concerning appropriate regulatory choices and levels of satisfaction.
  • The approach provides an analytic review of existing secondary materials associated with the performance of the industry, coupled with a review of the consumer experience including the conduct of a survey. According to PIAC, the study is the most cost effective way to effectively derive the interests of consumers in the framework of BDU regulation.
  • The study will review current BDU offerings in terms of pricing, content including community programming, service quality, choice and competition, and value for service. This information will be available from both companies, the CRTC, as well as sources such as the news media and specific industry reports. A small public survey tracking consumers views of service determined through the regulatory framework will inform the study.