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Broadband Privacy Rules Get a General Bashing

TV, ad industries look to GOP for help reversing FCC move 1/09/2017 8:00 AM Eastern
TakeAway

Broadband privacy and Title II rivals see an opening with the GOP takeover.

WASHINGTON — There is clearly a new sheriff in town, or at least the long shadow of one, as the Trump administration prepares to take over the Federal Communications Commission.

 

That was obvious from the tenor and flood of petitions to reconsider the broadband privacy order on a partisan vote in the waning days of the Tom Wheeler-led FCC, and by a congressional move that could potentially invalidate the order in one fell swoop.

 

The order requires Internet-service providers (ISPs) to get their customers’ permission (notice and choice) before sharing Web browsing and app-use histories with third parties for marketing and other purposes. It also contains data-security and data-breach notification rules, which prohibits making information sharing a quid pro quo for service. The agency also said it will take case-by-case looks at offering incentives to share data.

 

The FCC is also pre-empting state privacy, data security and data breach laws that conflict with its new rules.

 

BLUNT POINTS IN PETITION

 

The American Cable Association, NCTA: The Internet & Television Association and others — including ad associations representing billions of dollars, many of which are moving to online platforms — were clearly preaching to a new choir in their petitions, with the Republican commissioners preparing to take over the majority having voted against the privacy order and signaling they are ready to get out the regulatory weed whacker.

 

The ACA’s petition branded the order an error-laden train wreck, while NCTA gave four main reasons for scrapping the approach, saying it:

 

• Exceeds the FCC’s authority;

• “Arbitrarily and capriciously” departs from the Federal Trade Commission’s approach (the FTC was responsible for broadband privacy before the FCC reclassified ISPs as common carriers);

• Violates the First Amendment because it makes “speaker-based” distinctions between similarly situated competitors (ISPs and edge providers such as Google or Yahoo) in how they may use and share the same set of information;

• Creates “unworkable data breach and security requirements.”

 

Other than that, how was the play Mrs. Lincoln?

 

NCTA also said the FCC “wrongly concludes that ISPs occupy a unique gatekeeper role that justifies singularly restrictive limits on their ability to use customer data,” compounding the regulator’s error in reclassifying ISPs as common carriers under Title II of the Communications Act, which shifted broadband privacy authority to that agency from the Federal Trade Commission.

 

A consortium of ad-industry trade groups joined to argue that the order was fundamentally flawed for a number of reasons. Those included that the decision was arbitrary and capricious, violated the Administrative Procedures Act, ignored less restrictive proposals that had been offered and provided insufficient time for parties to comment on the proposal after it changed “materially” from the original FCC proposal.

 

If the FCC or Congress reversed the Title II reclassification, broadband privacy would revert to the FTC, mooting the order. But that could take some time.

 

REVERSING REGS IN HOUSE

 

Republicans in Congress, though, took steps toward deeding themselves new deregulatory territory that could moot the order more rapidly.

 

The House passed a bill — against loud protest from Democrats — that would allow it to sweep away regulations that were approved in the waning, and not so waning, hours of a previous administration with a single vote.

 

The broadband privacy order, approved in late October, would definitely be in their sights given the timing and that Republicans on the Hill joined Republicans on the commission in opposing the new privacy rules as overly restrictive.

 

At press time, Republican House members were working on various deregulatory bills that would give the Congress more opportunities to invalidate broadband privacy regulations, Title II reclassification and more.

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