The reforms "should give Americans the confidence" that their rights are being protected, Obama said Friday when outlining reforms to National Security Agency surveillance.
"I believe we need a new approach," Obama said during his speech at the Justice Department. "I am therefore ordering a transition that will end the Section 215 bulk metadata program as it currently exists, and establish a mechanism that preserves the capabilities we need without the government holding this bulk metadata."
Obama said he directed the attorney general to work with the Foreign Intelligence Surveillance Court "so that during this transition period, the database can be queried only after a judicial finding or in a true emergency."
He instructed the intelligence community and attorney general to use the transition period to develop options for the bulk data collection without the government holding the metadata collected -- phone logs of dates, phone numbers and length of calls but not content.
He said he expected a report before the data collection program comes up for congressional reauthorization March 28.
During a nearly 45-minute speech, Obama said he will consult with Congress and outlined programs that need congressional approval to proceed. He said his plan will ensure more transparency and greater privacy for individuals.
Turning to foreign intelligence-gathering, Obama said he issued a directive that clarifies the United States "only uses signals intelligence for legitimate national security purposes, and not for the purpose of indiscriminately reviewing the emails or phone calls of ordinary people."
"I have directed that we take the unprecedented step of extending certain protections that we have for the American people to people overseas. I have directed the DNI [director of national intelligence], in consultation with the attorney general, to develop these safeguards, which will limit the duration that we can hold personal information, while also restricting the use of this information.
"We will not monitor the communications" of heads of state of U.S. allies although the United States will monitor foreign governments, Obama said.
The changes, he said, "ensure that we take into account our security requirements, but also our alliances; our trade and investment relationships ... and our commitment to privacy and basic liberties. And we will review decisions about intelligence priorities and sensitive targets on an annual basis, so that our actions are regularly scrutinized by my senior national security team."
Obama called on Congress to authorize a panel of advocates from outside government "to provide an independent voice in significant cases before the Foreign Intelligence Surveillance Court."
Additional protections will be enacted for activities conducted under Section 702, which allows the government to intercept the communications of foreign targets overseas who have information that's important for our national security, he said.
"Specifically, I am asking the Attorney General and DNI to institute reforms that place additional restrictions on government's ability to retain, search and use in criminal cases, communications between Americans and foreign citizens incidentally collected under Section 702," Obama said.
He said the current use of secret "national security letters" would be amended so they won't be in effect indefinitely unless there's a national security reason. In national security letters, used by the FBI, companies disclose information to government officials without disclosing their revelations to the letter's subject.
Obama said the review panel he named to examine the nation's current intelligence-gathering methods turned up no indication the program was "intentionally abused."
"I did not ... stop these activities wholesale," Obama said, saying he found nothing to indicate the intelligence community was "cavalier" about privacy and civil rights.
"Having said that, I believe the critics are right that with without proper safeguards, this program could ... open the door to more intrusive collection programs in the future," Obama said.
He spoke little about Edward Snowden, the former NSA contractor who leaked information about the NSA's huge monitoring system and now is living under temporary asylum in Russia.
Such disclosures, Obama said, could mean the United States "won't be able to keep our people safe" nor conduct foreign policy.
He said the manner in which the leaks were published "shed more heat than light" and may have helped the country's adversaries.
Ultimately what's at stake in the debate goes beyond headlines or the tensions between national security and privacy advocates, Obama said.
"When you cut through the noise, what's really at stake is how we remain true to who we are in a world that is remaking itself at dizzying speed," Obama said.
"One thing I'm certain of," Obama said, "is this debate will make us stronger. ... . But let us remember that we are held to a different standard precisely because we have been at the forefront in defending personal privacy and human dignity.
"The world expects us to stand up for the principle that every person has the right to think and write and form relationships freely -- because individual freedom is the wellspring of human progress," Obama said. "I believe we can meet high expectations. Together, let us chart a way forward that secures the life of our nation, while preserving the liberties that make our nation worth fighting for."