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Now, more than ever before, knowledge is power. The information society puts such a premium on sorting the wheat from the chaff, that relevant facts — real knowledge — are invaluable. There is a less recognized corollary of that truism: Data represent profit. Virtual mountains of data are accumulating every day, identifying wants, needs and preferences. They pinpoint demographic profiles and can even pin us down in time and space. This marketing manager’s delight is a privacy advocate’s nightmare. Measures are needed to protect an individual’s rights to his or her data profile.

The information economy is smeared with footprints and fingerprints. Every electronic transaction leaves a residue. Internet browsers have “cookies” that record a user’s comings and goings across cyberspace. Those files can be tapped by the computers running home pages on the Net. Last month, Intel Corp. revealed that its new Pentium III microprocessor emits a Processor Identification Number, a unique serial number, that allows other people to track a computer’s travels across the Internet. Earlier this month, Microsoft Corp. admitted that its latest version of the Windows software generates a 32-digit number that is planted within electronic documents and can be used to trace the identity of the creators.

The ability to track an individual’s movements is not restricted to the online world. A British company recently announced that it has developed technology to permit the location of mobile phone users within a few meters. Electronic payment systems for smart highways similarly allow travelers to be traced or followed. A report to the European Union last year highlighted the dangers created by the marriage of closed-circuit TV cameras, high-speed computers and photo databases. At journey choke points — immigration counters at airports and ports, or highway toll booths — it is now possible to identify travelers in real time.

Some claim that only criminals need fear this new law-enforcement capability. That is not true. Governments can abuse such power; unscrupulous individuals can as well. Sometimes they are one and the same. No matter which, a legal framework that safeguards individual data and protects privacy is essential.

There is also an economic rationale for protecting privacy. The digital economy will be an age of transactions among distant strangers, for whom both anonymity and secure identification will be critical. Without assurances that the two parties to a deal are who they say are, business will not be done. In fact, Intel incorporated the emitter in its new chip so that Internet businesses could verify identities before providing access to sensitive information.

Moreover, the data that are part of that transaction are extremely valuable, too. Pieces of information can be gathered to form a mosaic, layered one atop another until an identity is revealed. The more precise the profile, the more valuable the data: Companies want to target their messages for maximum appeal. If that information is valuable, then surely it should belong to the individual to whom it refers.

These are not abstract issues. The United States and the European Union have already squared off over the issue of data protection. Last year, the EU passed legislation forbidding companies doing business there from transmitting personal data to countries that do not have laws as strict as Europe’s. U.S. businesses are up in arms, since U.S. laws regarding data protection, when compared to EU laws, are relatively lax. For example, the sale of subscription lists is commonplace in the U.S.; Europe requires a consumer to be informed before any such data can be sold.

Enforcement of the law has been suspended while trade negotiators try to bridge the gap, but the issue is only going to become more important over time. Japanese citizens should also be concerned, given the reports of data being lost, stolen or sold to third parties without proper authorization.

Traditionally, privacy has been viewed as a law-enforcement issue, but the advent of new technologies changes that. One does not have to be paranoid to be concerned about the newfound ability of anyone with the right equipment — and it does not take much — to monitor or intrude upon the lives of others. And once violated, privacy can never be restored. Some form of data protection is essential. The window is closing.

In a time of both misinformation and too much information, quality journalism is more crucial than ever.
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