Spotlight Report explores the perception of these legal agreements and its ethical implications

What you need to know:

• 50% of the individuals surveyed believe privacy policies are in place to protect consumers when they in fact only tell people how their data will be used

• 55% of participants do not understand that Terms of Service or Terms of Use agreements are contracts

• Based on this conclusion, Terms of Service may not be enforceable because consumers do not understand that they are entering into a contract when they agree to the terms

• Participants expressed that legal policies for digital technologies are often difficult to decipher. Thus, they choose not to read them in order to start using a website or app as quickly as possible

Me2B Alliance, a non-profit independent testing and advocacy organization focused on safe and respectful technology, today published a Spotlight Report which uncovers a distinct lack of understanding among consumers regarding legal policies such as Terms of Service, Terms of Use, and privacy policies. Through qualitative and quantitative research, the Me2B Alliance explores that lack of understanding, and its implications on the validity and ethical standing of such legal policies.

The Spotlight Report, “Me2B Alliance Validation Testing Report: Consumer Perception of Legal Policies in Digital Technology”, was originally initiated to understand if providing a formal rating of these legal policies (Terms of Service, Terms of Use and privacy policies) would be valuable to consumers. Concern arose during the research process when it became clear that individuals did not know whether these policies are legally binding contracts. Thus, a secondary objective emerged to quantitatively explore if individuals knew who these policies protected (if anyone), and if the policies were perceived to be contracts with the provider of the digital technology. Research was conducted with participants in the U.S. via interviews, a focus group, and an online survey.

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The online survey of 566 demographically diverse participants reveals that 55% of individuals do not understand that Terms of Service or Terms of Use agreements are contracts. This finding has significant legal implications because a key requirement for legally binding contracts is mutual assent. This means that both parties must have a “meeting of the minds” and must understand they are entering into a contract.

The Me2B Alliance’s research makes clear that is not the case in Terms of Service agreements. Based on this conclusion, Terms of Service may not be enforceable because consumers don’t understand what they are getting themselves into. This raises fundamental questions about the validity and ethical standing of such agreements.

The Spotlight Report also highlights a weak understanding of privacy policies among consumers. 66% of survey participants believe the policies are in place to protect businesses, while 50% believe they protect the consumer. The findings make evident the fact that individuals are unaware of a privacy policies’ true purpose [in the US], which is to notify and disclose, not to protect consumers or their data.

During a small focus group, participants shared with the Me2B Alliance that although they are aware of the existence of legal policies (such as privacy policies) for digital technologies, they often choose not to read them in order to start using a website or app as quickly as possible. This exacerbates the flawed understanding of such legal policies because only by reading the privacy policy disclosure can consumers understand how their data can be used.

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In addition to this troubling conclusion, many individuals who were interviewed by the Me2B Alliance were not aware of tools such as Privacy Badger which stops advertisers and other third-parties from secretly tracking what pages individuals look at on the web, or TOS;DR, which assists in “rating” Terms of Service. In the end, even with these tools, many of those individuals said these rating tools would not deter them from using a website or app that they were already benefitting from. Instead, they expressed that it may deter them from using an unfamiliar website or app if a bad rating was present.

“We are bringing this lack of understanding of legal policies to light to help illuminate and eventually eliminate the pervasive imbalance in relationships between consumers and businesses that exists in the digital space,” said Lisa LeVasseur, executive director at the Me2B Alliance. “We hope our research can serve as a concrete resource to lawyers supporting consumers in legal cases relating to digital agreements, and arm individuals with the insight they need to make informed choices online.”