Obama unveils 'identity ecosystem'

WASHINGTON, April 15 (UPI) -- The Obama administration announced its long-awaited strategy to protect U.S. consumers online and support innovation Friday.

The National Strategy for Trusted Identities in Cyberspace was set up to protect consumers from fraud and identity theft, enhance individuals' privacy and foster economic growth by allowing the industry to move more services online and create innovative new services, the administration said in a release.

"The Internet has transformed how we communicate and do business, opening up markets, and connecting our society as never before," President Obama said. "But it has also led to new challenges -- like online fraud and identity theft -- that harm consumers and cost billions of dollars each year."

By making online transactions more trustworthy and better protecting privacy, "we will prevent costly crime, we will give businesses and consumers new confidence, and we will foster growth and untold innovation," Obama said. "That's why this initiative is so important for our economy."

The goal of NSTIC is to create an "identity ecosystem" with interoperable, secure and reliable credentials available to consumers who want them. Participating consumers would get one credential, such as a unique piece of software on a smart phone, a smart card or a token that generates a one-time digital password. Because consumers can choose from a variety of credential providers, there will be no single, centralized database of information. Consumers can use their credential to prove their identity when they're carrying out sensitive transactions while remaining anonymous online.

The administration said the ecosystem will be led by the private sector, with the government providing help to develop the technologies, standards and policies necessary. Participation would be voluntary, and online anonymity would be maintained, officials said.

"We must do more to help consumers protect themselves, and we must make it more convenient than remembering dozens of passwords," Commerce Secretary Gary Locke said. "Working together, innovators, industry, consumer advocates, and the government can develop standards so that the marketplace can provide more secure online credentials, while protecting privacy, for consumers who want them."