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Fighting for a last word on privacy regulation

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Fighting for a last word on privacy regulation

Companies,organizations and politicians jostled to get a last word in on the FCC'scontentious privacy proposal as the reply comment period came to a close thisweek.

Thecommission is proposing to establish new privacy guidelines for broadbandInternet service providers, delineating between three types of personalinformation: information inherently shared when a consumer signs up forbroadband service, information that consumers must opt out of sharing andinformation and data that consumers must opt in to share.Only the data used bybroadband providers and their related affiliates to marketcommunications-related services would be subject to opt-out approval. Any otherdata would require opt-in approval.

TheFederal Trade Commission regimealso relies on an opt-in and opt-out approach but focuses more on consumerexpectations based on data sensitivity and company promises.

TheNational Cable & Telecommunications Association, which represents a largenumber of broadband service providers, filed a searing of the FCC's proposed rules onJuly 6, saying they are riddled with "legal infirmities." Inparticular, the association criticized the proposal as representing an "unwarranteddeparture" from the FTC's "core principle of establishing an optout/opt-in choice architecture that distinguishes between non-sensitive andsensitive uses of data."

, in its ownfiling, describedthe FTC regime as "flexible and highly effective," while casting theFCC's opt-in requirements as "unjustifiable and burdensome." The company also warned thatthe proposed requirements could lead to higher broadband prices for consumers.

"Overbroad opt-in requirementsimpose substantial costs, interfere with socially useful economic activity, andharm the very consumers they are intended to help," AT&T said, addingthat internet companies are only able to offer free and low-price servicesbecause they use some customer information to sell targeted advertising.

Asanother example of how this structure helps to keep costs down, AT&Tpointed to Google Inc.'sprivacy policy, which reads: "Ads are what enable us to make our serviceslike Search, Gmail, and Maps available for free for everyone."

AT&Talso reiterated the argument that edge providers like Google and have access tojust as much — if not more — user data than ISPs, and therefore ISPsshould not be singled out for more stringent regulation. AT&T noted thateven privacy advocates concede this point, pointing to previous comments fromElectronic Privacy Information Center.

In an oft-quoted filingfrom May, EPIC wrote that while consumers move between home internetconnections, wireless networks and Wi-Fi, "all pathways lead toessentially one Internet search company and one social network company."

The nonprofit added, "Privacy rules for ISPs areimportant and necessary, but it is obvious that the more substantial privacythreats for consumers are not the ISPs."

But in a new July 6 filing, EPIC said its previous remarks had been takenout of context. "Tobe clear, EPIC's view is that the FCC's proposed privacy rules are preferableto no action by the FCC," the group said, adding that it has "urgedthe FCC to do more within its statutoryauthority, not less."

Onthe same day that privacy-related comments were flooding into the FCC, membersof the House of Representatives were debatingthe 2017 Financial Services and General Government Appropriations bill, whichallocates funding for the FCC and myriad other federal agencies.During the proceedings,Rep. Marsha Blackburn, R-Tenn., introduced an amendment that prevents the FCCfrom using its appropriated funds to enforce or implement the rules in itsprivacy proposal.

"TheFCC's proposed rules are extreme and go well beyond anything they should bedoing," Blackburn said, adding that having two privacy regimes — one fromthe FTC and the other from the FCC — would "create confusion within theexisting internet ecosystem."

Theamendment was adopted, though President Obama has threatened to vetothe spending bill due to concerns about funding cuts and policy changes. Ascurrently written,the House bill also mandates the FCC make orders publicly available for 21 daysbefore the commission votes on them, prohibits the agency from regulatingbroadband rates, requires outstanding court challenges be resolved before theFCC implements its Open Internet order, and requires the FCC to hit the pausebutton on its set-top box proposal until the proposal's potential impact can bestudied.