WASHINGTON — February 26, 1999 — Today, the Center for Democracy and Technology, the Privacy Rights Clearinghouse, Consumer Action and Private Citizen formally asked the Federal Trade Commission to investigate and halt the distribution of the Intel Pentium III Processor as a violation of individual privacy and, therefore, an unfair and deceptive trade practice under Section 5 of the FTC Act.

Intel, the world's dominant chipmaker, is planning to release its new Pentium III chip on Sunday with an identifying serial number (PSN) that could be used to track computers — and computer users — across the Internet.

"At its core, the Pentium III PSN establishes a system that supports the wide spread tracking and monitoring of individuals' online behavior. It stands to undermine consumers' efforts to control the use of their information. Our experience warns that without real consumer control and policies limiting their use, unique identifiers threaten privacy," said Jerry Berman, Executive Director at the Center for Democracy and Technology.

The Complaint states that as the largest chip manufacturer in the consumer marketplace, Intel's product design decisions have far-reaching impact on consumers' online privacy. The combination of Intel's market dominance, coupled with the lack of accurate material about the privacy implications of the PSN, and the inability of individuals to control the use of the PSN, places consumer privacy at risk.

Referring to Intel's recent comments suggesting that the PSN was a security device, Ken McEldowney, Executive Director of Consumer Action said, "Intel is attempting to throw a blanket over the serious privacy issues in this chip. Yes, consumers need security but the price shouldn't be their privacy."

Beth Givens, Director of Privacy Rights Clearinghouse said, "The Intel Pentium III with a PSN brings us dangerously close to an environment of ubiquitous monitoring. This must be prohibited from going forward."

Deirdre Mulligan, Staff Counsel at CDT added, "We are worried that consumers will be required to disclose this new identifier as a price of gaining entry to Web sites — fundamentally eliminating the anonymity the Internet currently affords individuals. As designed, the PSN has the potential to become the de facto online identification system."

The Complaint asks the FTC to immediately enjoin Intel from shipping Pentium III Processors with a unique PSN and to commence an investigation into the privacy issues posed by the PSN. In addition, because a substantial number of chips have already been provided to computer manufacturers the Complaint asks the FTC to enjoin manufacturers from shipping Pentium III PSN-equipped computers unless the PSN is turned off in a secure manner.

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