WASHINGTON, DC — Today, the FCC voted 3-2 to approve the new rules to regulate broadband privacy and data security proposed earlier this year. The rules fill a gap in privacy protection created by the FCC’s 2015 Open Internet Order, which reclassified broadband providers as common carriers, thus denying the FTC jurisdiction over them. While the FCC claims to have harmonized its approach with the FTC, the new rules mark a fundamental shift by requiring broadband companies to obtain opt-in consent for certain categories of information.

“This isn’t about privacy; it’s the FCC picking winners and losers in the ongoing evolution of the web,” said Berin Szóka, President of TechFreedom. “The FCC is simply trying to hamstring broadband companies in competing with edge companies — not just for the delivery of advertising, but also for any of the new consumer services that will emerge as the Internet evolves. The real-world difference between opt-in and opt-out rates is so stark that imposing two completely different rules simply makes it impossible for broadband companies to compete. That may protect search, social networking and apps giants from competition but it does nothing to protect consumers. Broadband companies can still get the data they’d need — if they buy it from edge companies.”

“And yet, Wheeler is also laying the groundwork for heavier burdens on edge companies,” continued Szóka. “Whatever his intention today, everything he said about ‘consumer choice,’ ‘faceless companies’ and ‘corporate algorithms’ can and will be used by those pushing to impose opt-in mandates on the entire Internet ecosystem. The FTC will now face enormous pressure to change its approach, and the ongoing debate over comprehensive privacy legislation will shift to ’harmonizing up’ to opt-in mandates. The biggest edge companies may be able to survive such burdens, because of their existing relationships with consumers, but they’ll be fatal to new edge companies. The more our privacy approach comes to resemble Europe’s, the more Silicon Valley — and consumers — will suffer.”

“As with other major last-minute rulemakings, this one may fall apart in court,” said Tom Struble, Policy Counsel at TechFreedom. “The FCC stands on shaky legal ground here, and a court may find that the agency was required to put its revised rules out for further public comment in order to satisfy APA notice requirements. The FCC’s plan to restrict private arbitration agreements going forward is even more likely to fail in court, given the total lack of evidence to support claims that these agreements are harmful to consumers. Once again, the FCC is more concerned with grabbing headlines and playing to its political base than with actually following the law.”

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We can be reached for comment at media@techfreedom.org. See our other work on privacy regulation, including:

  • Our reply comments urging the FCC to avoid a rushed attempt to regulate broadband privacy
  • Our statement on the FCC’s announcement of a plan to regulate broadband privacy
  • Out of the Frying Pan & into the Fire: The FCC Takes over Privacy Regulation, a TechFreedom working paper
  • “FCC Privacy Regulation Should Follow FTC’s Consumer Protection Standards,” a statement from TechFreedom

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