Proposed FCC rules that would require broadband Internet service providers (ISPs) to obtain subscriber consent before collecting and sharing certain data with advertisers and other third-parties were debated at a Senate subcommittee hearing on Wednesday. Testifying before the Senate Judiciary Subcommittee on Privacy, Technology and Law, FCC Chairman Tom Wheeler advised lawmakers that the FCC’s proposal conforms to the agency’s historic treatment of telephone companies that are subject to Title II provisions regarding confidential treatment of consumer and interconnecting carrier information.
Wednesday’s hearing also featured appearances by FCC Commissioner Ajit Pai, Federal Trade Commission (FTC) Chairwoman Edith Ramirez, and FTC Commissioner Maureen Ohlhausen. Voicing concern that the proposed rules— which would apply exclusively to ISPs and not to websites and other “edge” providers that also collect consumer information—“will only confuse consumers and give them a false sense of security,” subcommittee chairman Jeff Flake (RAZ) inquired in an opening statement whether the Internet would be the same today “if these prescriptive rules were imposed a decade ago.” In response to Flake, Wheeler drew distinctions between consumer usage of edge providers and of ISPs. Observing, “most of us understand that the social media we join and the websites we use collect our personal information,” Wheeler told the panel that, “seldom, however, do we stop to realize that our ISP is also collecting information about us.” Wheeler further noted that “we can chose not to visit a website or not to sign up for a social network” but “once we subscribe to an ISP . . . most of us have little flexibility to change our mind or to do so quickly.”
Although Wheeler emphasized that “we are not intending to assert authority over edge providers,” Pai cautioned that the “virtuous circle” theory used by the FCC in exercising its authority to promulgate the Open Internet rules “is certainly elastic enough to encompass edge providers.” Meanwhile, as Ramirez confirmed the FTC’s intention to submit comments on the FCC’s rulemaking proposal, Ohlhausen explained that “an opt-in approach is appropriate for sensitive information” collected by edge providers, which are regulated by her agency, but that an opt-out approach is reasonable for nonsensitive consumer information held to a less stringent privacy standard.