Former FTC Chair Has Issues With FCC's Opt-In CPNI Regime

Tells commission it would be better to harmonize with FTC approach
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While former Federal Trade Commission chairman Jon Leibowitz says he is in general agreement with the FCC's broadband privacy initiative and its effort to protect consumer privacy generally, he definitely has some issues with the specifics.

That came in a meeting with Ruth Milkman, chief of staff to FCC chairman Tom Wheeler, and Matt DelNero, chief of the Wireline Competition bureau, according to an FCC filing.

As chairman, Leibowitz signaled he recognized the value in targeted online advertising, emphasizing the need for self-regulation and clear notice and choice for consumers who wanted to opt out.

The FTC used to oversee broadband privacy, using its enforcement power to go after false and deceptive practices to make sure privacy policies were adhered to. The FCC, which inherited oversight when it reclassified internet access as a telecom service subject to common carrier regs, is taking a different approach, proposing rules that require users to opt in to having their customer information shared with third party marketers.

Leibowitz told the FCC officials that a broad opt-in regime was inconsistent with other privacy regulation and it would be better to harmonize the FCC approach with how the FTC handled it, something ISPs have been arguing as well. He said it would hurt broadband providers ability to compete for online advertising. Edge providers like Google, for example, are under no such opt-in requirement.

He suggested the opt-in requirement might be confined to only sensitive customer data and deep packet inspection (DPI).

Leibowitz also said that instead of the FCC's current proposal to prohibit broadband providers from offering discounted service in exchange for a customer opting in to greater data collection and use, there could be a notice and choice regime where, so long as ISPs provided sufficient notice, users could have the choice of putting a value on their personal data. Leibowitz noted that was consistent with the FTC's 2012 Privacy Report (issued while he was chairman of the FTC).

Finally, he suggested that the FCC could reduce the burden of its data breach reporting requirement by applying it only to breaches of sensitive information or those posing a "reasonable risk of harm."

Leibowitz, now a partner with Davis Polk in Washington, was chairman of the FTC from 2009 to 2013 and a commissioner before that.

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