Antitrust Law Daily Wrap Up, PRIVACY NEWS: McSweeny discusses privacy concerns over today’s innovative connected cars, (Feb 4, 2016)

By Linda O’Brien, J.D., LL.M.

The age of “connected” cars has begun and what it means for consumers, the automotive industry, and the job market will be answered by how regulators, enforcers, legislators, and innovators approach issues of safety, security, and privacy, said FTC Commissioner Terrell McSweeny in a speech today at the Connected Cars USA conference in Washington, D.C.

McSweeny began her remarks by noting that consumers want innovations in a new car, such as hands free communication, advanced safety features, and a choice of Android, Windows, or iOS operating systems. This connectedness places remarkable capabilities at consumers’ fingertips and allows for transformative innovations. However, these innovations must be safe, secure, and offer reasonable privacy.

For years, the role of the FTC in the automotive sector has been policing advertising claims and warranties, and ensuring that consumers received fair treatment in dealer financing, McSweeny observed. However, the marketplace has evolved and the FTC’s enforcement has evolved with it. In 2002, the FTC brought its first case concerning the security of consumer data and, since that time, has brought more than 50 data security cases. With each case and with programs like the “Start with Security” initiative, the agency has developed a framework for reasonably securing consumer data by applying sound security practices.

McSweeny noted that the FTC’s data security cases are important for protecting consumers and the marketplace. Privacy and security are increasing in importance to consumers as more products and functions in vehicles become Internet-enabled and “behave more like information age computers than industrial age machines.” The data capabilities of today’s on-board computers and cloud-based vehicle applications will improve all facets of the vehicle experience—from fuel economy to music selections—but they also increase vulnerabilities.

While visiting various conferences where car hacking was been featured, the Commissioner learned from security researchers, or hackers, that cars were prominent targets. In her view, this prominence could create opportunities to enhance the safety and security of cars and the trust of consumers. The auto industry would be well served by following the lead of the information technology industry, which has developed ways to work with hackers rather than against them.

It is promising, McSweeny noted, that some in the auto industry are recognizing the value of forming partnerships as part of their security programs, as hackers can work to uncover flaws and vulnerabilities in their vehicles. This also builds on the work the industry is doing in the creation of the Auto ISAC to share cyber threat information. The connected car will profoundly revolutionize mobility in that it can save lives, help the environment, save consumers time and money, and change the way cities are designed. But society can only get there if consumers trust the product that they getting into, the Commissioner concluded.

News: Privacy ConsumerProtection FederalTradeCommissionNews