In Landmark Ruling, FCC Protects Privacy of Consumer Data

The Federal Communications Commission, by a 3-to-2 vote, passed rules protecting consumers’ digital information, by preventing broadband companies such as AT&T and Comcast from collecting and distributing data including Web browsing, app use, location and financial information. Up until this ruling, users had to opt-out of broadband providers’ right to track such data. The ruling is considered a landmark since it is the first time the FCC issued privacy restrictions to high-speed Internet providers.

The New York Times notes that the FCC previously created privacy regulations for phone and cable television companies, and that the current rules aimed at broadband providers “deal a blow to telecommunications and cable companies like AT&T and Comcast, which rely on such user data to serve sophisticated targeted advertising.”

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NYT even suggests that the ruling may have an impact on AT&T’s $85.4 billion offer to buy Time Warner, “because one of the stated ambitions of the blockbuster deal was to combine resources to move more forcefully into targeted advertising.”

“There is a basic truth: It is the consumer’s information,” said FCC chairman Tom Wheeler. “It is not the information of the network the consumer hires to deliver that information.” With the ruling, the U.S. is now “more in line” with Europe, where countries have aggressively protected online privacy of their citizens.

U.S. privacy groups have expressed strong support for the move. “For the first time, the public will be guaranteed that when they use broadband to connect to the Internet, whether on a mobile device or personal computer, they will have the ability to decide whether and how much of their information can be gathered,” said Center for Digital Democracy executive director Jeffrey Chester.

But the industries that use online digital data decried the new rules, with the Association of National Advertisers dubbing them “unprecedented, misguided, counterproductive, and potentially extremely harmful.”

The missing piece is consumers’ awareness of when they’re giving away personal information, particularly for free services like maps. “Some people unknowingly forgo their privacy when allowing apps or other services to track their location or follow their browsing across websites.” The FCC regulations also don’t include Google, Facebook and other “online ad juggernauts,” over which the federal agency does not have jurisdiction.

Web entities such as Google are subject to the Federal Trade Commission’s “general consumer protection rules.” Some providers will continue to have access to digital data, via such services at AT&T’s DirecTV, since only their broadband business is subject to the new FCC rules. All these companies can also buy data from brokers.

Related:
Telecoms’ Ambitions on Targeted Ads Seen Curbed by FCC’s New Privacy Rules, The New York Times, 10/29/16