FCC Work on Privacy Seen Tied to Net Neutrality, Overturning Reclassification

Lawyers who represent ISPs told us the FCC appears to be still feeling its way on how to proceed. The agency could approve an immediate Title II reversal declaratory ruling, which would “moot many of the privacy recon issues,” or could launch a rulemaking on the issue, said a lawyer who represents ISPs on privacy. A former FCC official said no decision has likely been made by Pai and staff on how to proceed.

The work on an NPRM will likely start by May or June “but the FCC isn't likely to actually resolve anything for quite some time,” said Berin Szoka, president of TechFreedom. If the Supreme Court grants a hearing on the appeal of the 2015 net neutrality order, the regulator “will almost certainly wait” for the court to rule, Szoka said.

Supporters of the Wheeler privacy order aren’t giving up hope. Pai wants to shift oversight of privacy to the FTC, but that assumes “Republicans can re-re-classify and get away with it,” said Matt Wood, Free Press policy director. “There are questions about their legal aptitude to do so, as well as their political fortitude." Anything Pai proposes “will face a stiff challenge not just in the agency proceeding but in court,” Wood said.

John Oliver Moment?

Pai wants to push forward on reclassification but “may change his tune once it's his face on Stephen Colbert or John Oliver,” Wood said. “Ultimately, there's no truth to the notion that Ajit Pai can continue taking away fundamental rights and protections while telling people it's really for their own good. Making internet access less affordable, more restrictive, and less secure is not exactly a winning campaign for him.”

ISPs “face a national uprising over their Big Data consumer tracking operations,” emailed Jeff Chester, executive director of the Center for Digital Democracy. “The Trump FCC has quickly become Open Internet enemy number one, which now includes assuring privacy protections. Everyone knows the FTC has no statutory authority to effectively address privacy,” except for children.

The net neutrality order “by law, pushed the FTC out of any privacy role regarding ISPs,” said Mark Jamison, University of Florida professor and member of the Trump transition landing team for the FCC. “If the FCC reverses the 2015 net neutrality decision, then the FTC would again have authority to impose its privacy policies on ISPs, which are the same policies that it uses for all other players in the online ecosystem,” Jamison said. “In reversing its 2015 decision, the FCC would be taking itself out of privacy regulation on ISPs.”

The route the communications agency will follow is unclear, Jamison said. “That depends on the legal hoops through which the agency must jump,” he said. “I would like for it to have been done yesterday, but the laws seem clear that the FTC cannot step into this space as long as the Title II decision is in place. If reversing the 2015 decision will take a long time and if ISPs begin to violate their customers' trust, then perhaps the agency could revisit the record in the privacy proceeding and adopt policies that mirror the FTC's policies.” If quicker change is possible, “self-regulation with the threat of agency intervention will be enough to ensure that the ISPs follow the FTC guidelines,” he said.

Sections 201, 202

“Adoption of Title II is the original sin,” said Free State Foundation President Randolph May. “When the Wheeler commission swallowed the Title II apple, it created, knowingly, a public policy problem that would be left to others to resolve.” Ideally, Congress could step in quickly to restore FTC oversight of ISP privacy and a uniform privacy regime, May said. “This should be something Congress could accomplish that ought to have at least some bipartisan support. Barring that, I think the FCC could issue a notice to supplement the record in the privacy proceeding and then move fairly quickly to adopt a uniform regime, pending further action by Congress.”

Using Communications Act Section 201 and 202 authority “to hold [broadband] providers to their privacy commitments is a very workable holdover solution until privacy can legally be returned to the FTC,” said Doug Brake, telecom policy analyst at the Information Technology and Innovation Foundation. “Those desperate to keep Title II are making mountains out of molehills on the path to putting privacy back with the FTC. But I would be very surprised if the FCC attempted another rulemaking rather than simply fixing the source of the problem -- Title II classification.”

Dallas Harris, policy fellow at Public Knowledge, doesn’t expect more from the FCC on privacy until it addresses net neutrality and reclassification. “Not only is Chairman Pai inclined to address net neutrality before attempting to fill the gap in privacy protection, it's even less likely now, given the legal uncertainty that the CRA created,” Harris said. “It seems like Chairman Pai is determined to roll back the important protections put in place through the open internet order so yes, privacy will likely go back to the FTC. What is especially important is that we don’t allow there to be a regulatory bait and switch where ISP privacy is returned to the FTC, and simultaneously congressional Republicans weaken the FTC with process reform bills.”

“Net neutrality proponents are now frantically trying to politically lash together net neutrality and consumer privacy somehow as related issues ... it reeks of political desperation,” countered NetCompetition Chairman Scott Cleland. “For over a decade, proponents framed net neutrality as saving the internet from censorship, discrimination, and ISP control to enable Internet freedom, freedom of speech, and the next inventor in a garage -- with nary a peep about the need to protect consumer privacy.” The calculation is simple, Cleland said: “Consumer privacy is apparently more politically popular than net neutrality could ever hope to be.”