Several major US Internet companies, including Google and Facebook, need to "step up" and better protect consumer privacy or face tougher penalties from the US Federal Trade Commission, a commissioner said.

Commissioner Pamela Jones Harbour, who is leaving the FTC next month, ripped into Google for the launch of its Buzz social networking tool in February, and she complained that many other Internet firms, including Facebook and Microsoft, aren't encrypting the consumer data that lives in their clouds.

"I am especially concerned that technology companies are learning harmful lessons from each other's attempts to push the privacy envelop," she said during an FTC privacy workshop. "Even the most respected and popular online companies, the ones who claim to respect privacy, continue to launch products where the guiding privacy policy seems to be, 'Throw it up against the wall and see if it sticks.'"

Wednesday's forum was the third about consumer privacy that the FTC has hosted since December. The agency wants to shape the debate about what are appropriate consumer privacy protections, but it will also take action against companies it believes not lived up to the privacy promises, Harbour said.

"I realise that companies continue to take a testing-the-water approach to privacy because no regulatory agency has sent a clear message that this behavior is unacceptable," she said. "I would like to see the commission take the position of intolerance toward companies that push the privacy envelope, then backtrack and modify their offerings after facing consumer and regulator backlash."

Harbour targeted Google in particular for criticism, saying its launch of Buzz constituted "irresponsible conduct." In the original public version of Buzz, the program compiled a list of the Gmail contacts the users most frequently emailed or chatted with and automatically started following those people. Those lists were made public, giving strangers access to the contacts of Buzz users.

There was an immediate outcry from Gmail users, and Google made changes to Buzz within a couple of days. But Harbour said Google seems not to have learned from similar privacy controversies with past product launches, including the Google Talk instant messaging service.