ITIF Urges FCC to Leave Privacy Regulation to FTC, Avoid Discouraging Innovation

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The Information Technology and Innovation Foundation today called on the Federal Communications Commission to halt its move to regulate broadband privacy.

The Information Technology and Innovation Foundation (ITIF) today called on the Federal Communications Commission (FCC) to halt its move to regulate broadband privacy. In a new report, ITIF argues that broadband consumers already have meaningful control over their privacy, and deviating from the historical oversight role of the Federal Trade Commission (FTC) would hinder innovation in data-driven services and stifle business models that could decrease broadband costs and boost broadband adoption.

“Broadband populists are pushing the FCC to take the unprecedented step of regulating broadband privacy because it advances their broader strategy of turning the industry into a regulated utility, like gas or water,” said Doug Brake, ITIF telecommunications policy analyst and the report’s lead author. “But the populists’ arguments significantly understate the control that broadband customers have over their privacy today and ignore how new privacy regulations will hurt the very people they claim they want to help. The FCC should leave broadband privacy up the Federal Trade Commission and refocus on its core mission: supporting the advancement and expansion of America’s communications networks.”

The report, titled “Broadband Privacy: The Folly of Sector-Specific Regulation,” outlines why the push for FCC regulation of broadband privacy is ill-conceived:

-Consumers already have meaningful control over their privacy: Broadband customers users who are sensitive about their privacy can control how their information is used, both through technology and through existing opt-out and other control mechanisms offered by ISPs.

-FCC regulation would slow innovation: There are numerous opportunities for innovation using data, especially as networks become increasingly adaptable. Consumer data also enables targeted advertising, which can lower costs for consumers, increase revenues to pay for network upgrades, and make the market more efficient.

-FCC regulation would reduce the rate of broadband deployment and adoption: Costs may play more of a role in non-adoption than initially thought, and the opportunity to offer lower prices based on data collection policies will likely be a boon for those looking for lower-cost options to get online or upgrade to faster connections, but not if the FCC regulates ISP privacy.

“Proponents of FCC regulation have set up a false choice between consumers’ ability to connect to the Internet and their personal privacy, which is absurd,” said Brake. “In addition to privacy-protecting technologies like encryption and virtual networks, all major broadband providers already allow consumers to control how their information is used.”

“The calls for rigid, paternalistic regulation from advocacy groups like Public Knowledge and New America Foundation are flawed,” Brake said. “They systematically ignore the benefits of data innovation, downplay the advantages of industry best practices within the flexible FTC framework, overstate risks, and understate customers’ control over their privacy.”

Read the report.

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