FTC to Be Data-Driven Under Ramirez, Consistent with Leibowitz’s Tenure, Consumer Protection Acting Director Says

Ramirez will likely increase the focus on privacy concerns for lower income consumers, including how user data affects employment screenings and credit access, Harwood said. Additionally, Ramirez is interested in looking at “the Internet of Things,” such as smart devices, he said; while the innovative technologies are exciting, smart devices “have a lot of data already.” The agency wants “to make sure that consumers’ privacy remains a consideration” and will likely hold workshops on these issues in the future, he said. Additionally, the FTC will continue to examine data brokers, “what their practices are [and] how they use information,” Harwood said. The agency cannot bring any enforcement actions based on responses to letters it sent to nine data brokers last year, but “we can use it to develop reports,” he said.

Lawmakers are seeing increased pressure from constituents to do something about online tracking, said Joseph Wender, aide to Rep. Ed Markey, D-Mass., co-chair of the Congressional Privacy Caucus. “We're hearing more and more from constituents about the concerns they have over the use of their information,” particularly sensitive information, including financial data, Wender said. “There is a lack of knowledge, or, some would argue, a lack of transparency, when it comes to some of the practices” of those entities collecting user information online, he said. “I think there is a need for this industry to explain itself a little better to consumers” so consumers can understand the benefits and risks that come along with data collection.

The World Wide Web Consortium (W3C) Tracking Protection Working Group that was tasked with examining DNT has yet to define “tracking” and “failed to define the problem that they were trying to solve,” said Stu Ingis, Venable lawyer and privacy counsel to the Interactive Advertising Bureau, on a panel. “Do Not Track has lots of meanings to different people,” and in the 18 months they've been working on it, the W3C group has failed to define it for industry members, he said.

Default DNT settings are not reflective of consumer choice, Ingis said, referring to recent moves by Mozilla and Microsoft to enable DNT settings by default on their browsers. Instead, the free market should determine what consumers want, he continued. A system of DNT by default “would really undercut ... the ecosystem for collection in a responsible way,” he said; the online advertising industry “is not going to sign up for a program … that will fundamentally be bad for consumers and their customers.” Users “are not clamoring” for a DNT-by-default system, he said. “This is a fabricated thing being pushed by some more extreme viewpoints."

Self-regulation by the industry is working, Ingis said, pointing to the Digital Advertising Alliance’s AdChoices icon, which Ingis said “appears trillions of times online.” While the online advertising industry could do more to be transparent with and educate consumers, “I think we've solved the problem,” he said.

The W3C Tracking Protection Working Group may see more progress under its new leader, Peter Swire, said Center for Democracy and Technology Senior Staff Technologist Joseph Hall. “There was clearly stagnation” before Swire was announced as the new co-chair of the working group, he said. Since taking the position, Swire has brought stakeholders together and held “a ton” of one-on-one meetings to tackle the “little nitty-gritty things ... that have enormous implications,” including the definition of a third party, he said. “It really seems like it’s going in the right direction."

The Senate Commerce Committee’s inquiry into companies that collect online consumer data is not about investigating consumer abuse, fraud or scams, said the committee’s senior counsel, Erik Jones, during a separate panel. The investigation was begun “solely to better understand practices that clearly have important implications for consumers,” said Jones. Last fall, Senate Commerce Chairman Jay Rockefeller, D-W.Va., asked nine data brokers how they collect, use and sell consumer information (http://xrl.us/bntd4h). The letters sent to Acxiom, Experian, Equifax, Transunion, Epsilon, Reed Elsevier (Lexis-Nexis), Datalogix, Rapleaf and Spokeo sought specific information on the consumer data they collect, which entities the companies sold the data to and whether and how the companies provide consumers with the ability to access, opt out, correct or delete their data (WID Oct 11 p9). Jones said the committee is still in the information-gathering phase of the inquiry and at some point will either hold a hearing or issue a report on its findings.

An aide to Rep. Marsha Blackburn, R-Tenn., warned that some lawmakers may have “rushed to judgment” in the debate over data collection practices. “We don’t have all the answers. We want to take a humble approach to these issues,” said Josh Lynch, Blackburn’s technology legislative assistant. Rather than seek broad legislation to govern data collection, it would be more appropriate to identify any consumer harms and then work on narrow legislative solutions, said Lynch. Blackburn believes “privacy and data security are important things but she believes markets work,” he said. “We need to balance the increase in innovation with protecting consumer confidence in the online marketplace."

DMA Vice President-Government Affairs Rachel Thomas said Congress is giving marketing firms an “opportunity” by asking for more information on their data collection practices. “We need to explain to folks clearer ... what we are doing with information and more importantly what we are not doing with information,” she said. “Our industry has a real incentive to self-regulate effectively. We should put our money where our mouth is.”