(FORTUNE Magazine) – A man in Memphis secretly installed a spyware program called Spector on his 13-year-old stepdaughter's personal computer last fall and discovered, by reading her private e-mail, that she was having sex with her 37-year-old schoolteacher. Confronted with the evidence, the teacher pleaded guilty to statutory rape last month and received a $500 fine and probation.

Spectorsoft, the company that created Spector, uses the case as an example of the benefits of its affordable, easy-to-use snoopware programs for consumers. An invasion of privacy? Of course. But the only difference between Spector and similar programs used by a majority of large businesses to spy on the computer use of employees is that the corporate programs are more sophisticated and widespread. And those programs, in turn, are far less sophisticated than the ones used by government and law enforcement agencies to monitor the e-mail, file transfers, faxes, and phone calls of both private citizens and companies.

Everywhere you look, things are looking back at you, and they're taking notes. Most of the time you don't know it. From miniature digital surveillance cameras to smart cards and biometric sensors to Websites that capture your every mouse click and report the results to giant direct-marketing databases, technology enables millions of tiny privacy atrocities every day.

Louis D. Brandeis, later to become a Supreme Court justice, warned more than a century ago of the threats that technology poses to personal privacy. Imagine what Brandeis would think of this: Beginning this year your cell phone will be able to report your location, within about 50 yards, to a database. And what would he make of this: The new Financial Services Modernization Act, which goes into effect this summer, allows banking, insurance, and securities companies to affiliate and share sensitive consumer information among themselves (but not with third parties)--banking and credit card records, payments for medical services and entertainment, political, religious, and charitable contributions, and so on. The businesses promise to keep the data private, but so did U.S. Bancorp, which paid millions to settle a complaint that it sold customer data, including account numbers and balances, Social Security numbers, and home phone numbers, to telemarketers. And the Internet, well, it's the most voracious and efficient gatherer of detailed personal information of all time.

Citing the failure of commercial and even government Websites to self-regulate, many congressional leaders promise to push privacy legislation in 2001. Just last fall, at a hearing of the House Commerce Telecommunications Subcommittee, Representative John Shimkus (R-Illinois) called privacy "the big issue of the new millennium." But is it too late?

"You have zero privacy anyway. Get over it," Scott McNealy, CEO of Sun Microsystems, said a couple of years ago when asked about the ability of new smart information appliances that hoover up data on consumers the way a vacuum cleaner sucks up dust. And it appears that consumers are getting over it. Robert Ellis Smith, editor of The Privacy Journal, a newsletter, says that for the most part, consumer interest in privacy "is a mile wide and an inch deep. People don't probe into it very deeply. Maybe they think it's the price they pay for living in the 21st century." For instance, consumers seem unwilling to take advantage of new technology tools designed to safeguard their information--in essence, fighting fire with fire. Part of the reason may be the technology itself. "You have to be more sophisticated than the average Joe Internet user to use these tools," said Beth Givens of the Privacy Rights Clearinghouse, a consumer watchdog agency.

The one area where consumers do seem to care about privacy is online commerce. This may be because e-commerce, which involves a credit card and a purchase, is simpler to comprehend than a sophisticated government snooping program that monitors the passage of data packets across a network. Consumer outrage over e-commerce excesses has had an impact. DoubleClick reined in its data-gathering tactics after Web users protested, forcing Amazon.com and America Online to reevaluate their own customer-tracking plans. To some, that's evidence that privacy is not dead. "Every new technology has raised privacy issues, and we've learned to deal with it," said Marc Rotenberg, director of the Electronic Privacy Information Council, a public interest group. "Privacy is the future. Get used to it."

--Peter H. Lewis