In October of 2016, the Federal Communications Commission (FCC) passed legislation tracking the ways in which Internet Server Providers (ISPs) handle sensitive online data. If the rule were active, it would require large companies like AT&T and Comcast to offer customers the option to “opt-in” before selling personal information to advertisers. This rule was blocked in late February by the new FCC chairmen, Ajit Pai who thinks the measure would treat ISPs unfairly. A spokesperson for Pai had this to say: “All actors in the online space should be subject to the same rules, and the federal government shouldn’t favor one set of companies over another.”
Privacy advocates and Democrats hold a different view. They believe that ISPs are “gatekeepers” to the internet and so they should be held to higher standards than companies like Google or Facebook. For instance, one can choose not to use Facebook, but it is far more difficult to opt out of a deal with one’s internet provider, whether it be Verizon or Comcast.
Companies like Facebook are regulated by the Federal Trade Commission (FTC), which employs a narrower definition of “sensitive data.”
The Question of Special Interest
It should be noted that Pai is not a neutral party in this matter. He used to work as a lawyer for Verizon, one of the companies that would be affected by this rule, and when the FCC decided last October to pass the regulation, Pai voted against it. Of course, this is not out of the ordinary, especially in the current administration where several former Goldman Sachs executives hold influential positions, like Gary Cohn who is the Director of the National Economic Council.
Internet providers like Verizon have a vested interest in Pai’s decision to stay the implementation of this rule. Verizon has a particular interest in protecting itself against the lawsuits and fines that could come from this regulation, considering its history of tracking sensitive information without consumers’ consent. In 2015, it was uncovered that Verizon installed permanent supercookies onto its customer’s devices to follow user activity. What’s worse is that when the company finally gave customers a way out, they replaced the supercookies with another cookie for similar tracking. In the end, the FCC fined the company $1.35 million dollars, the kind of money Verizon would probably like to avoid spending in the future.
The Desire for Protections
It is no secret that US citizens want more privacy, which means, in part, more protections against large internet companies. A PEW study, carried out in 2016, found that 68 percent of Americans “believe current laws are not good enough in protecting people’s privacy online.” Moreover, 64 percent want stronger regulations against advertisers. Finally, 91 percent of Americans think that consumers have lost control over how companies use and handle online data. Taking these numbers into consideration, it would appear that Americans disagree with Pai’s decision.
It is not surprising that the FCC stayed the enforcement of the rule. After all, the Republican Party has been attacking regulations with full force ever since Trump took office. If Pai didn’t succeed in stalling the measure, then Congress would have probably taken over. As the LA Times reported on February 27th, Senator Jeff Flakes (R. Ariz.) said he wanted to use the Congressional Review Act to stop the FCC’s regulation and to prevent the writing of “substantially” similar rules.
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