Wireless interface says privacy OFF

[Steven Friedrich]

What does "privacy" mean and why isn't it explained in any man page?

Here's my ifconfig:
wlan0: flags=8843<UP,BROADCAST,RUNNING,SIMPLEX,MULTICAST> metric 0 mtu 1500
	ether 00:14:a5:2a:a5:db
	inet 192.168.2.254 netmask 0xffffff00 broadcast 192.168.2.255
	media: IEEE 802.11 Wireless Ethernet OFDM/54Mbps mode 11g
	status: associated
	ssid FriedrichAir channel 1 (2412 Mhz 11g) bssid 00:17:3f:f1:3d:50
	country US authmode WPA privacy OFF txpower 0 bmiss 7 mcastrate 6
	mgmtrate 6 scanvalid 60 protmode CTS roaming MANUAL

This wlan0 is configured to a NDIS wrapped Windows Ethernet driver.
New in 8.0, the bwi driver supports the same hardware.
When I get the ifconfig for wlan0 when it's configured for he bwi driver, 
privacy said ON.

What exactly does privacy mean and do I want it ?