Privacy snafu enrages eBay customers

Online auction giant changes the settings for some 6 million accounts, and the unsolicited telemarketing calls begin pouring in.

EBay isn't taking "no" for an answer.

The company has changed the personalised settings for roughly 6 million customers who signed up for eBay between April and November of last year after a bug in its registration system was discovered.

The bug changed the default answers from "yes" to "no" to many questions on the registration page, such as "Do you want to receive calls from telemarketers?" The questions should have all been pre-answered "yes."

Customers were notified of the change and were given 14 days to change the settings before they took effect, said eBay spokesman Kevin Pursglove.

Pursglove said it was impossible to tell which customers changed the answers from the default settings but that "a great majority of the customers who registered this year had their settings changed".

Online privacy group TrustE said the eBay changes raise privacy concerns and it plans to grill execs about it in the next few days. This is a change of mind for TrustE, one of several groups that eBay briefed on the details before changing people's preferences. TrustE at first gave its okay.

"It appeared to us as more of a customer service issue largely because it did not deal with the transfer of information to a third party," spokesman Dave Steer said. "But after hearing reports of what’s going on and talking with folks, I think there are legitimate privacy concerns."

Steer said "eBay’s a role model to other Web sites. A problem like this is so new, eBay has to set the right example".

Several eBay faithful are angry, especially because the company decided to change its policy not to send marketing materials to customers or give telemarketers personal phone numbers.

"Someone has decided to arbitrarily unselect my preference to not get called by eBay telemarketers!" Daryl Banttari, an eBay customer, wrote in an email. "I can't find the words to describe how amazed I am at the boldness of the people responsible for this."

The same problem may have kept customers from getting updates on eBay's privacy policy or notifications that someone else had bid on something they are trying to buy, both of which are usually answered with a "yes", Pursglove said.

"It's an inconvenience, and we apologise for it," he said.

The move adds another dimension to the debate about whether companies should let consumers decide for themselves what they want from a company or be automatically registered and then have to "opt out".

Automatic registration, or "opting out", is what usually happens when a customer registers on eBay. The company's registration page contains a list of questions including whether the consumer wants to get eBay emails about deals. The default is usually checked "yes", and it is up to the customers to change the box to "no".

While some people will want to receive information about eBay deals, the company's decision "stretches credibility," according to Richard Smith, chief technology officer of the Privacy Foundation in Denver, Colorado.

"It's not a nice thing. I don't see how it's an error that they simply chose 'no' as a default," Smith said. "If there was an error, it was the company's."

America Online made a similar move last year, Smith said. The company let customers know that their choice not to receive AOL spam had to be renewed every year, and if AOL didn't receive a reply, the customer was automatically signed up to receive unwanted email.

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