But in some areas -- notably providing contact information so site visitors can file complaints -- the Internet industry still falls far short of Congress' expectations, the study reveals.
Former Federal Trade Commissioner Christine Varney, who now represents the Online Privacy Alliance trade body emphasised the finding most favourable to the industry: 94 percent of the top 100 most heavily trafficked commercial Web sites tell users whether they collect personal data and how they use it.
In a separate sampling of 364 randomly selected sites, 65.7 percent gave privacy notices, up from just 14 percent last year, Varney said. "The movement from last year clearly indicates that the marketplace is doing its job" in regulating what it does with digitally harvested personal data, she said during a press conference.
The survey, conducted by researchers at Georgetown University for the FTC and paid for by high-tech companies, comes just under a year after the FTC conducted its own survey of data privacy on commercial Web sites, and discovered that the vast majority harvested data without telling users.
What's at stake, according to some observers, is potential government regulation that could have a chilling effect on e-commerce. The FTC this summer is expected to issue an opinion to Congress on whether new laws are needed. Opponents of regulation say they are encouraged by the results of the latest survey.
But some privacy watchdogs maintain the survey results can be interpreted in a number of ways -- not all of them good for the Internet industry. "Our view is, less than 10 percent of the sites they surveyed had all the aspects of privacy" that were singled out in the survey as being important, said Ari Schwartz, a policy analyst at the Centre for Democracy and Technology.
The survey methodology pointed to five key elements: notice of data collection, choice to opt out, access to the data to rectify errors, adequate security of info databases, and access to contact persons at Web sites. Of the 364 sites randomly surveyed, just 9.5 percent contained all those elements, according to the survey. Of the top 100 most popular sites, about 18 percent contained all elements. To Schwartz, this is very problematic.
"Notice is only a first step, and for what we define as adequate notice, few of the sites measured up," he said. But he added that CDT officials are glad to see that major commercial sites are taking privacy more seriously.