Public Interest Groups not Concerned About FTC Comments on FCC Privacy Rules

“There is support within the commission; I think this is something that they definitely want to get done,” said Meredith Rose, staff attorney at Public Knowledge. “To the extent that this is a big item for Chairman Wheeler, I know he would like to get this out the door before the end of his tenure. … We know that there is a concerted effort to get this done,”

But Rose conceded every commissioner will have questions, which has led to lots of discussion on the FCC eighth floor. “It’s kind of impossible if you’re not on the eighth floor to read how that’s going, but I think there’s generally very broad support for this among the three Democratic commissioners.” Rose predicted a final vote before the end of the year.

The FTC in comments at the FCC raised questions about the FCC’s approach and whether it would create major differences between how ISPs and other companies are regulated (see 1606020062). But the public interest officials said they don’t believe the FTC staff concerns will slow FCC work on an order.

“I actually thought that the FTC staff comments were very supportive and I think that they are being mischaracterized as criticizing the FCC and what it’s trying to do,” said Susan Grant, director-consumer protection, at the Consumer Federation of America. Staff, in effect, made several suggestions on how the FCC could implement rules, she said. “I thought that those suggestions were very constructive.”

A major problem is that the FTC’s system of determining whether information is more sensitive and thus worthy of more protection doesn’t work for ISPs, Rose said. “It doesn’t work from an engineering standpoint,” she said. “In order for an ISP to determine what information flowing over its network is particularly sensitive under the FTC’s framework you’d have to inspect” the data, she said. ISPs have metadata, but any one of those packets could contain health or financial information or a Social Security number, Rose said. “In order to actually figure out what packets contain this FTC-tiered sensitive data … requires [ISPs] to actually read the packets.”

"It flies in the face of history to say that the FTC has weak privacy authority and enforcement,” said Adonis Hoffman, chairman of Business in the Public Interest, in response to the public interest group comments. "This effort by the FCC rests on dubious authority in the open internet order, which could be overturned any day now. Contrary to assertions, it is not well settled. In fact this authority and approach is unsettled. Thus, the value of the FTC's experience and expertise."

The FTC can't regulate common carriers, said Claire Gartland, consumer protection counsel at the Electronic Privacy Information Center. If the FCC doesn’t act, consumers will be “left exposed” to ISP’s “invasive” profiling practices. “The failure to modernize our privacy laws is imposing an enormous cost on American consumers and businesses,” she said. The FTC’s current approach “based largely on notice and choice is simply not working,” she said.

Inaccurate statements were made on the call, said Richard Bennett, free-market blogger and network architect. “This proceeding does nothing to protect end-user privacy on the Internet,” Bennett said in an email. “The bulk of Google’s $75 [billion] revenue stream comes from ad sales driven by awareness of consumer interests, and that will continue unabated. But that’s a good thing because Internet applications are supported by ad sales and we don’t want content and services to go away.”

Comparisons of the Internet to traditional phone networks are “disingenuous,” Bennett said. “The Internet is essentially a public, advertising-supported medium rather than a public, subscription-supported one,” he said. “Title II reclassification doesn’t change the way the Internet works as a whole.”