Ms Reding threatened that if social networking sites such as Facebook themselves do not make moves to ensure the profiles of minors are kept private, she would intervene with legislation to force them to do so.

"Privacy must, in my view, be a high priority for social networking providers and for their users. I firmly believe that at least the profiles of minors must be private by default and unavailable to internet search engines," she told the meeting in the European Parliament, organised by Icomp, an industry initiative backed by Microsoft to discuss the online marketplace.

"The European Commission has already called on social networking sites to deal with minors' profiles carefully, by means of self-regulation," she continued. "I am ready to follow this up with new rules if I have to."

But she said she worries about all users of social networking, not just children, and fears that most users of such sites are unaware of the dangers to their privacy.

"Social networking has a strong potential for a new form of communication and for bringing people together, wherever they are," she said. "But is every social networker really aware that all pictures and information uploaded on social networking profiles can be accessed and used by anyone on the web?"

Advertising concerns

The EU's internet chief also said that behavioural advertising - those ads that appear that seem to know exactly the sort of books or vacations or concerts you would be interested in - was "another privacy concern repeatedly mentioned to the European Commission these days."

Behavioural adverts are able to do this by keeping track of internet users' web browsing to better target them with advertisements.

Ms Reding said that the EU executive was watching this development for infringement of privacy: " European privacy rules are crystal clear: a person's information can only be used with their prior consent."

"The commission is closely monitoring the use of behavioural advertising to ensure respect for our privacy rights," she added. "I will not shy away from taking action where an EU country falls short of this duty."

The commissioner also warned of the perils contained within the "internet of things" - the use of radio frequency identification (RFID), or smart chips, that could be attached to any product.

There is enormous potential from a world in which all mugs, containers, shoes or airplane parts are attached with tiny identifying devices. Analysts predict that common events that plague businesses and individuals such as running out of stock, product wastage, and theft. Losing your keys could be a thing of the past, if we know where a product is at all times.

But there are also great privacy pitfalls in such a world, noted Ms Reding.

"I am convinced [RFID] will only be welcomed in Europe if they are used by the consumers and not on the consumers," she told the crowd.

"No European should carry a chip in one of their possessions without being informed precisely of what they are used for, with the choice to remove or switch it off at any time."

"The "Internet of Things" will only work if it is accepted by the people."

Her speech also focussed on the need for a single online market for digital content, which she has repeatedly argued is fragmented, a competitive disadvantage for Europe when compared to the United States.

Before the end of the current commission's mandate, she said, she and internal market commissioner Charlie McCreevy would publish a "reflection paper" over a set of possible legislative options to create such a single digital market.

Ms Reding would also like to see the development of a European Rights Registry to ease the digitalisation of books. Such a registry would aim to overcome the current problem of books republishing online books that are out of print, but whose copyright ownership remains cloudy.

Although the Luxembourgish Ms Reding has expressed an interest in returning to Brussels as part of President Jose Manuel Barroso's second college of commissioners, it is not clear that if she returns, she would be awarded the same dossier.

She underlined that in making her comments on the future of the internet, she did not want to "pre-empt the new commission."