ISP Privacy Debate Set for Revival During Tuesday House Hearing

Those criticisms follow a letter earlier this month from Commerce Committee Chairman Fred Upton, R-Mich., Communications Subcommittee Chairman Greg Walden, R-Ore., and Trade Subcommittee Chairman Michael Burgess, R-Texas, that attacked the NPRM as “the wrong approach” (see 1606010053). The Democratic staff memo doesn't criticize the proposal.

"In short: The FCC seems unable to see ISPs as ISPs," Walden plans to say in his opening statement. "It still sees them as siloed cable, wireline, and wireless companies and regulates them as though the Internet hasn’t changed everything. ... The impacts of these rigid regulations have the potential to disrupt an ecosystem that has flourished for years, and unfortunately, it’s consumers who will pay the price. The FCC has proposed a set of regulations that would not only single out ISPs based on faulty assumptions, it would affirmatively prevent ISPs from competing. A robust record of comments warns of higher costs, stifled innovation, and fewer service offerings. None of these are risks we should be willing to take or consequences we are willing to put on American consumers. We should be encouraging competition, not slowing it down with burdensome and inconsistent regulations."

The NPRM “would create inconsistent standards across the internet, harm and confuse consumers, and undermine innovation,” former FTC Chairman Jon Leibowitz plans to testify Tuesday at the hearing, set for 10:15 a.m. in 2123 Rayburn. “For all these reasons, the 21st Century Privacy Coalition’s view is that the FCC should adopt the FTC’s time-tested and proven approach.” He co-chairs the coalition of telecom companies that also caution against the proposal and is an attorney at Davis Polk. The rules contemplated in the NPRM “deviate sharply” from the FTC approach and “threaten to create not only consumer confusion, but also frustration and disruption of their online experiences,” he will say.

Information Technology and Innovation Foundation policy analyst Doug Brake shares some of these concerns: “The FCC is making the wrong up-front choice for consumers by mandating an opt-in process that will reduce consumer welfare, productivity, and innovation," he will testify. "We should prefer the FTC model as simply superior in supporting data innovation compared to that proposed by the FCC.” Privacy policies “should be developed at a national level through Congress,” which is “better suited to ascertain the implications of broadband privacy regulations on areas outside the FCC’s jurisdiction and balance the numerous policy goals implicated by this proceeding,” Brake will argue. He intends to blame the current rulemaking on the FCC reclassification of broadband as a Communications Act Title II service, which the agency did in its net neutrality order.

“The FCC has acted appropriately and wisely,” Paul Ohm, professor at the Georgetown University Law Center and faculty director at the Georgetown Center on Privacy and Technology, intends to say in his testimony. “For all of the amazing strides the FTC has taken to become an expert in online data collection, the FCC has had a much longer time to develop expertise in the protection of network access subscribers. With this head start, the FCC has unparalleled experience ensuring that the nation’s communications networks function in a way that is reliable and trustworthy and crafting regulations that promote the buildout of networks. Nobody has more experience and staff expertise on these matters than the FCC.” Ohm is a former senior policy adviser to the FTC, where he focused on privacy issues. He will argue the Communications Act Section 222 amounts to a “clear statutory mandate” that is “specific and proactive.”

Ohm will note that Congress may want to strengthen privacy laws overall, citing the sensitive areas of location information and online social networking and advertising. “Congress should examine whether any other industry has implicated individual privacy along these dimensions so much that they have begun to rival doctors, schools, credit agencies, or BIAS [broadband internet access service] providers,” he will say. “Once it identifies such an example, the answer will not be to decrease privacy law across industries, the answer will be to enact another new, measured and narrow sectoral privacy law, one which draws bright lines.”

Several ISP industry officials sent a letter to subcommittee leaders Monday opposing the FCC's proposed rules. "In no way does the FCC’s decision to reclassify broadband as a Title II service require a departure from the FTC’s successful approach to privacy based on effective notice to consumers and a meaningful choice as to how their data is used," said the letter, signed by leaders representing the American Cable Association, CTIA, the Internet Commerce Coalition, ITTA, Mobile Future, NCTA, the Telecommunications Industry Association and USTelecom. They called for a "principles-based approach" that "would ensure consistency internationally as discussions continue around the 'Privacy Shield' to facilitate cross-border data sharing and avoid what one Member of the European Parliament recently called a 'glaring double standard' that 'would certainly raise eyebrows from a European perspective.'"