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CONSUMER PRIVACY CONCERNS AND PREFERENCE FOR DEGREE OFREGULATORYCONTROL
A Study of Mobile Advertising in JapanShintaro Okazaki, Hairong Li, and Morikazu Hirose ABSTRACT: This study explores the consequences of consumers' privacy concerns in the context of mobile advertising. Drawing on social contraer theory, the proposed research model connects a series of psychological factors (prior negative experience, information privacy concerns, perceived ubiquiry, trust, and perceived risk) and preference for degree of regulatory control. Data from a survey of 51O mobile phone users in Japan show that mobile users with prior negative experiences with information disclosure possess elevated privacy concerns and perceive stronger risk, which leads them to prefer stricter regulatory controls in mobile advertising. Both perceived ubiquity and sensitivity of the information request further the negative impact of privacy concerns on trust. No such effect occurs for the impact of privacy concerns on perceived risk, however. The authors discuss sorne theoretical and managerial implications.Consumer privacy concerns with respect to mobile advertising have become an important issue for policymakers, trade groups, and consumer advocates as unfair information practices continue to escalare in many countries. In the United States, unsolicited messages or spam increased by 38% from 2006 to 2007 and was expected to increase by 50% more to l.5 million messages in 2008 (Cloudmark 2008). Sorne spam messages request mobile users to provide personal information, including their credit card numbers, or attempt to infiltrare mobile devices with virus programs by asking users to register for services (CNET.co.uk 2006).To alleviate consumers' concerns about these potential invasions, the mobile industry has implemented several selfregulations. For example, the Mobile Marketing Association recently revised its consumer best practices guidelines, including those regarding promotional content and marketing to children; it also expanded and clarified its guidelines for free, standard, and premium rate messaging, mobile Web, and interactive voice responses ( Despite these different regulatory measures, what makes the most effective type of regulation in terms of protecting consumer information privacy remains a topic of debate. To assess the appropriateness of different approaches, we might examine mobile users' preferences for the degree of regulatory control, because users influence both mobile service providers and regulatory government agencies. Therefore, this research explores the relationship between consumer privacy concerns in mobile advertising and their preference for three types of regulations: government regulation, industry self-regulation, and government and industry coregulation. Government ...