A Democratic former chairman of the Federal Trade Commission is advising regulators at another agency not to pass new rules that would restrict how broadband providers handle customer data, warning that they would “fundamentally” depart from precedent.
“If adopted as proposed, [the rules] would result in a detailed set of burdensome data-privacy rules with no precedent in the FTC or other U.S. privacy regimes … inconsistent with the privacy obligations applied to the rest of the economy,” wrote Jon Leibowitz, who served as his agency’s chairman from 2009-13.
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Leibowitz offered his advice in the form of a 13-page public comment submitted to the Federal Communications Commission on Monday. Though the FTC is generally responsible for regulating privacy practices, the FCC co-opted that power over broadband providers last year by voting to reclassify them as public utilities.
The agency now is looking at imposing its own rules to govern the privacy practices, an area in which it does not specialize. Democrats, particularly FCC Chairman Tom Wheeler, have expressed support for the rules, while Republicans have voiced skepticism. That makes the criticism from Leibowitz, who was twice appointed by President Obama, especially notable.
“The FCC should conduct meetings to fully understand the effects of its proposed requirements before potentially causing disruption to an entire industry and the Internet ecosystem, particularly in areas where the FCC relies on FTC precedent in contextually inaccurate ways,” Leibowitz wrote, recalling that the FTC had studied the issue for years before the FCC voted to seize power.
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He also noted that the rules would represent a sizable shift from precedent, requiring consumers to opt-in to practices that previously required an opt-out. “The FCC’s overbroad opt-in approach has the potential to stifle innovation and competition in the online advertising marketplace, and undermine benefits to consumers,” Leibowitz said.
He closed with a call for the FCC to examine its rules through the lens of a cost-benefit analysis, suggesting that the practices the agency was seeking to prohibit should not be “outweighed by countervailing benefits to consumers or to competition.
“The FCC should adhere as closely as possible to the FTC’s time-tested and proven approach,” Leibowitz said.
