The privacy question

Remember when you first started shopping online? You might have been a little nervous about entering your credit-card number, but it seemed a small price to pay to shop from home. Today, your privacy is almost nonexistent: Buy a book, and it's added to a list of all the items you've ever bought online. Use a promo code to get free shipping on your new camera, and the e-tailer knows what other sites you've browsed. This phenomenon is called behavioral targeting, and it's ubiquitous.

How it works

Companies amass details about you and how you spend your time (and money) online from information you volunteer when you fill out profile pages (such as telling Facebook how old you are or entering your mailing address so that you can get a coupon book). Also, when you visit many websites, they place a small file, called a "cookie," on your computer. That cookie is then used to identify your address and track how you use the Internet. The data helps retailers sell to you more efficiently. For example, if you search for plane tickets to Italy, you might see ads for hotels in Rome. The opt-out system in the U.S. means that you often give consent the moment you type a Web address into your browser. But if you keep all your information to yourself, you'll miss out. You can't get that 20 percent off coupon for a local restaurant if the site doesn't know where "local" is. And so we're increasingly—often unwittingly—trading our privacy for personalization, convenience, and savings. Cookies might not tell retailers your name and age, but they can help companies assemble a picture of who you are and what you like, making anonymity almost impossible. Companies can figure out your income, health status, race, education level, religion, sexual orientation, political affiliation, and much more—and there's an industry built around selling that info to retailers. Marketers know more about us than ever, and with so many bits of personal info out there, we're at risk for dangerous leaks. Blippy, had a security breach earlier this year that briefly exposed some user credit-card numbers in Google searches.

At press time, Congress was considering a bill that would require websites to display simplified privacy policies, protect info from third parties, and permit users to opt out of accepting cookies, among other protections. In the meantime, here are some ways to protect your privacy:

• Don't give info just because a website asks for it. If you do share personal info, be sure to read the site's privacy policy.
• Clear browsers' caches to delete cookies. Set Internet options to accept cookies only from authorized sites. Reject Flash cookies at macromedia.com/support/documentation/en/flashplayer/help/settings_manager06.html.
• Opt out of Google's behavioral targeting ad program (search "Google Advertising Cookie Opt-out Plugin" and follow directions), then opt out of other programs at www.networkadvertising.org/managing/opt_out.asp.
• Disable geolocation in computer and mobile browsers, and deny requests to "find your current location" when asked, unless you want info that requires your location.