Speaking in Brussels earlier this week, Ms Reding said that, whilst the 27-nation EU privacy rules have so far "stood the test of time", social networking sites, internet-enabled mobile phones and targetted advertising on the internet create the need for a "shift of focus."
"We need to find ways to empower web surfers", he said, adding that internet users must have effective control of what they put online and be able to correct, withdraw or delete that data at will.
According to Peter Boyland, an analyst with Global Insight, Reding's comments have significance as, although Google has claimed its WiFi data gathering was a mistake, the search giant is now being asked to explain why it was using its Street View vans to access WiFi networks in the first place.
The war of words over personal data use between the privacy watchdogs and the internet giants, he said, is now coming to a head, creating a situation where the internet companies must now self-regulate, or risk facing harsh penalties and having regulation forced upon them.
According to Boyland, Reding said that she would be look at harmonising internet commerce customer rights across the bloc, to remove legal barriers to trading and encourage consumer confidence.
The Global Insight analyst went on to say that the rise in the use of social-networking services and personalised search tools has meant that the collection of private data by the web giants is exploding, and the use of this information is becoming big business, with estimates that this market will grow to over 3 billion euros, eight times as much as in 2007.
"Of late there have been increasing calls for an increase in EU regulatory powers in the telecoms sector, in particular to police the internet sector", he said.
"The EU has repeatedly stated that it regards internet access as a fundamental human right, and has recently launched a consultation on the telecoms universal service laws, with a view to extending the fundamental right to web access to cover broadband services", he added.
Following effective regulation in the telecoms sector, Hoyland said that this largely guaranteed cheap services in the EU, the focus of regulation is now shifting to the internet.