Will price for convenience of 2-way TV be privacy?
John W. participates in an ''electronic public forum'' sponsored by his local cable-TV company. He registers his preferences on a variety of public issues using a keypad attached to his television set, which allows him to send information back to the cable company. He votes ''yes'' on gun control, ''no'' on a new town library, and ''yes'' for new sports equipment for the local high school. The results are publicized as aggregate statistics.
Within two weeks, John W. gets a mailing from a mayoral candidate. To his surprise, the candidate's brochure outlines a series of positions strikingly similar to John W.'s own. Using information obtained from the cable company, the candidate had tailored his messages to voters.
The possibility that this hypothetical incident - and others like it - could happen disturbs Connecticut Attorney General Joseph I. Lieberman. That's why his office is pushing for the Connecticut General Assembly to pass a bill now before it that would protect the privacy of subscribers to so-called ''two way'' cable television.
Mr. Lieberman is not alone in his concern. Similar privacy legislation has been introduced in New York at the behest of Attorney General Robert Abrams. Lexington, Ky., and Milwaukee, along with the states of California, Illinois, and Wisconsin, have already passed some sort of cable-TV privacy controls, the Conference on Alternative State and Local Policies in Washington, D.C., reports. It lists Maryland and Missouri among other states that have considered such legislation recently.
Two-way TV is expected to become increasingly popular as more homes are linked by cable. Subscribers may someday be able to shop, bank, and pay bills via TV. Some cities already have fire and burglar alarms that signal firefighters or police via cable TV; at least one system also conducts public-opinion polls.
But when Americans use these services, private experts say, they will be giving cable companies a ''distinct profile'' of their buying preferences and personal opinions. With two-way TV, the companies may eventually learn what products subscribers are buying and other information such as whether they pay bills quickly, slowly, or not at all.
Such information could be valuable to third parties. A manufacturer, for example, might use information on what was purchased via TV to pinpoint future advertising campaigns. A burglar might be able to learn which homes were connected to the community alarm system.
''Information should be used only for the purpose for which it was collected, '' says David F. Linowes, who studied cable-TV privacy as chairman of the US Privacy Protection Study Commission under President Carter. He says that was the central conclusion of the commission's 160 recommendations, released in 1977, which have yet to be acted upon.
''It's the same problem as with any computer data bank,'' explains Professor Linowes, who now teaches at the University of Illinois. The incredible capacity of computers as recordkeepers means that ''today it's cheaper to store data than destroy it,'' he says. To protect individuals, he adds, ''information should be destroyed after it's served its purpose.''
Cable companies, meanwhile, say the best way to deal with the potential problem is not legislation. The National Cable Television Association is ''not opposed in principle'' to legislation, a spokesman says, but is ''not sure there is a need'' for it. The association, the spokesman says, is working with cable owners' groups in several states to write their own voluntary codes. Warner-Amex , which operates the ''CUBE'' two-way system in Columbus, Ohio, is believed to be the only company operating with a voluntary privacy code.
But some privacy groups, such as Citizens for Privacy in Nashville, Tenn., say it is important that laws are passed before two-way systems are in place. Under existing laws, data collected by cable companies belong to them and not to subscribers. The proposed New York State legislation encourages cable companies to keep this information to themselves by providing fines up to $50,000 and a year in jail for disclosing information about a subscriber without written consent. It also makes it illegal to tap into a cable line.
Harry D. Lewis, legislative coordinator of Citizens for Privacy, says his group has identified three key points that any cable-TV privacy legislation should contain:
1. Consumers should be forewarned that data on them are being collected by the cable company.
2. Such data should not be used without the consent of the subscriber.
3. Whenever possible, data should be collected in such a way that individual subscribers remain anonymous.
No subscriber or community should install a cable system without knowing how individual privacy rights will be handled by the cable company, privacy experts and civil libertarians say.
