Microsoft says it will follow California's digital privacy law

Tech companies could see the bottom line hit by the new law.

Microsoft is taking a step toward guarding customer privacy that will impact the bottom line.

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The company said in a blog post on Monday that it would honor California's privacy law throughout the United States, according to Reuters.

The law called the California Consumer Privacy Act or CCPA, which goes into effect on Jan. 1.

It is a strict set of rules meant to protect consumers and their data.

"Under CCPA, companies must be transparent about data collection and use, and provide people with the option to prevent their personal information from being sold. Exactly what will be required under CCPA to accomplish these goals is still developing," Julie Brill, Microsoft's chief privacy officer, wrote in the blog. "Microsoft will continue to monitor those changes, and make the adjustments needed to provide effective transparency and control under CCPA to all people in the U.S."

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Technology companies are among the businesses that will be impacted by the law since many collect consumer data to track users and increase sales.

Companies are concerned that California would just be the beginning, with other states creating their own rules before a federal standard is created.

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In September, Reuters was first to report that the federal privacy bill is not likely to come before Congress this year as lawmakers disagreed over several issues.

It may be easier for Microsoft  to conform to the new rules since it can qualify as a service provider, according to Reuters.

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A service provider has a written agreement with a business, stating that it will not retain, use, or disclose the personal information of consumers other that what is stated in a contract.