Antitrust Law Daily Wrap Up, PRIVACY NEWS: FCC open Internet order may “fragment” privacy oversight: Ohlhausen, (Jun 18, 2015)

By Lynn Stanton,TRDaily

FTC Commissioner Maureen Ohlhausen said on June 16 that she is “concerned” about the effect that the FCC’s February open Internet order will have on consumers, including the potential for the “fragmentation” of privacy regulations, as the FCC invades what was previously FTC territory by asserting oversight of privacy protections provided by broadband Internet access service providers.

Commissioner Ohlhausen said there could also be “competitive impacts” if different regulations apply to different entities that collect similar information.

In its February order, the FCC reclassified broadband Internet access services as telecommunications services subject to the provisions of Title II of the Communications Act, including the obligation to protect customer proprietary network information (CPNI). However, the FCC did not apply its own rules implementing the statutory CPNI obligations to Internet access providers, because the rules were written with telephone networks in mind.

Speaking at a “rooftop policy roundtable” organized by the Phoenix Center for Advanced Legal & Economic Public Policy Studies, Commissioner Ohlhausen suggested that the FCC should take the same “harms-based approach” to privacy that she has been urging her fellow FTC Commissioners adopt. This means that an agency investigating a company’s privacy practices should consider whether any practice, misinformation, or lack of disclosure actually harmed consumers.

“Our job is to make consumers better off,” she said, adding that there are “so many potential benefits of these technologies” that regulators should not needlessly foreclose their use.

When the FTC reached a settlement with Nomi Technologies, Inc. over allegations that the firm misled consumers when it said it would provide a mechanism to allow them to opt out of tracking while in stores, Commissioner Ohlhausen dissented. She felt “there was no evidence of harm,” since a web-based global opt-out mechanism was available and “the global opt-out had higher than average usage.”

The Commissioner was asked about consumer protections when companies use facial recognition technology, which consumer advocates said was not being adequately addressed in multi-stakeholder discussions to develop a code of conduct regarding use of the technology. Commissioner Ohlhausen responded that the FTC could address situations in which a company misrepresents its use of facial recognition technology or engages in unfair practices in the collection of financial, medical, or other sensitive information.

She added that the decision by the consumer advocates to withdraw from the multi-stakeholder promise illustrates the “interesting limits of the multi-stakeholder process.” She said that “there has to be some common ground that people can reach” if the process is to accomplish its goals.

News: Privacy FederalTradeCommissionNews