But its stock isn't the only one that swooned after a privacy snafu. Now the whole online advertising industry is working with federal regulators to come up with voluntary privacy rules. The industry correctly sees that corporate disregard for privacy will quickly lead to legislation. Click for more. Once the word gets out that a site surreptitiously trades consumers' information, eyeballs go elsewhere.
Consumer confidence is easy to lose.
And tough to restore. It's the law. It bars sites from collecting personal information from kids under 13 without a parent's say-so. It's already forcing some sites to change the way they do business. As Web companies merge and form alliances, inadequate privacy policies can make those alliances difficult, and possibly worthless.