Apart from the usual privacy issues, I don't think it is bad in itself. Let's face it: it was bound to happen because that what new technologies do. When fingerprinting arrived in 19th century, massive information (especially at the time) was collected and used. Nobody sees anything against it nowadays. And whatsoever, it is one way or another controled by the courts as it is related to criminal offences
"Police database is 'major new weapon' against crime" (ZDNet.co.uk, 6 April 2009)
On the other hand, I find it troubling that internet data can be retained. Apart from the technical side of how to use the data (frankly, if one does not use traditional investigatory techniques, how do you go through the materials?), I am puzzled by what it means in terms of control on citizens. Schematically, internet is used for e-mail, blogs (and the like), and website/shopping.
I don't see where Government can justify spying on e-mail traffic: one of the greatest advances in human rights in the 18th century was the privacy of letters (contents and where they go); why should it be different with the internet? the fear of crime CANNOT be an excuse to give away one of our liberties that our ancestors thought for, sometimes risking their lives in order to obtain those liberties.
Similarly, I don't see how we can justify spying on blogs/facebook type of traffic: do we spy on phone conversations? Well officially you need a warrant, don't you?
Similarly, for the rest of the traffic: I can't understand the basis of such a measure.
Internet data-retention law comes into force (ZDnet.co.uk, 6 April 2009)
"Just So We're Clear: More Data Isn't Better Data" (TechDirt, 8 April 2009)
"EFF: Obama DOJ's Warrantless Wiretapping Arguments Are Worse Than Bush's" (TechDirt, 8 April 2009)
At the end of the day, our liberties are eroded in the name of crime and fear of crime. Liberties are not better protected by giving them up. Time to stand up. In that sense, I just finished going through the near 300 pages of Hypercrime. the new geometry of Harm by M. McGuire (Routledge, 2007). Although I don't agree with all what the author is saying, it conforts what I always thought: before affirming that the internet is per se different, let's compare with what happened in the past. McGuire's study is sociological and very valuable; I wish a lawyer could write the same book on a legal perspective. It would deflate the Government and media's hype we keep hearing about cybercrime.