FCC, FTC Bosses Pen Misleading Editorial Falsely Claiming The Best Way To Protect Your Privacy Moving Forward... Is To Gut Net Neutrality

from the you're-not-helping dept

As they've long made clear, Trump, FCC boss Ajit Pai, and other net neutrality opponents have every intention of killing net neutrality rules. Of course, given the huge, bipartisan consumer popularity of net neutrality, these folks can't just come out and say they're doing that, lest they incur the wrath of internet users and activists. As such, they've begun laying the groundwork for a misleading argument that attempts to make gutting oversight of the uncompetitive broadband industry -- and killing net neutrality -- sound almost pleasant.

The latest example of this came via an op-ed this week in the Washington Post, jointly written by FCC boss Ajit Pai and FTC boss Maureen Ohlhausen, entitled "No, Republicans didn't just strip away your Internet privacy rights." Of course they did, and there's not any real debate that this is what happened, but this being the post-truth era -- countless individuals labor under the illusion that facts are somehow negotiable. Amusingly, the editorial can't even make it a full sentence without being misleading (read: lying):

"April Fools’ Day came early last week, as professional lobbyists lit a wildfire of misinformation about Congress’s action — signed into law Monday by President Trump — to nullify the Federal Communications Commission’s broadband privacy rules. So as the nation’s chief communications regulator and the nation’s chief privacy enforcer, we want to let the American people know what’s really going on and how we will ensure that consumers’ online privacy is protected."

Of course, 90% of the lobbying at play on this subject came via telecom industry giants like AT&T, Verizon and Comcast, who are spending millions of dollars to reduce oversight of one of the least competitive business segments in American industry. Even Google, one-time consumer-advocate, had lobbied in opposition to the rules (pdf). The mortal sin the rules committed was that they required that consumers opt in (the dirtiest word imaginable in advertising) to having their personal financial and browsing data collected and sold.

It's also worth reminding folks here that the lion's share of consumers, be they Democrat, Republican or Independent, supported the privacy protections and wanted Trump to veto what was seen, quite correctly and uniformly, as an embarrassing example of pay-to-play politics:

So yes, to begin, the only "misinformation" here is originating with Pai and Ohlhausen. The duo proceed to parrot large telecom companies in claiming that people are overreacting because ISPs don't really collect much data about them:

"Let’s set the record straight: First, despite hyperventilating headlines, Internet service providers have never planned to sell your individual browsing history to third parties. That’s simply not how online advertising works. And doing so would violate ISPs’ privacy promises.

Note the continued use of the phrase "individual" by ISPs and the policymakers kneeling in fealty to them. Yes, ISPs don't sell your "individual" browsing histories (yet), but they do collect wholesale clickstream data, DNS records, location data, redirected search entries and countless other metrics -- using a vast array of sophisticated deep packet inspection and other network gear. Some of this data is "anonymized" and sold and some isn't, but to suggest that ISP "privacy promises" (privacy policies written entirely to protect the ISP from legal liability) are some kind of magic protection for consumers is hysterically and patently false.

From there, the pair proceed to parrot the other key talking point ISPs have been pushing over the last year. Namely, that eliminating the FCC privacy rules isn't a big deal because the FTC will rush in to fill the oversight vacuum and protect consumer privacy:

"Second, Congress’s decision last week didn’t remove existing privacy protections; it simply cleared the way for us to work together to reinstate a rational and effective system for protecting consumer privacy. Both of us warned two years ago that the FCC’s party-line vote to strip the Federal Trade Commission of its jurisdiction over Internet broadband providers was a mistake that would weaken Americans’ online privacy."

That's again, patently false. The FCC stepped in only because ISPs were engaged in all manner of bad behavior and the FTC lacked the authority, motivation, or resources to do anything about it. This ranged from ISPs charging users hundreds of additional dollars a year to opt out of data collection, to covertly modifying user wireless packets to track users around the internet without telling anybody. The FCC's rules were specifically tailored to protect consumers from broadband providers that enjoy limited competition, and thereby limited repercussions for bad policy behaviors.

Those that want an open and healthy internet need to understand that this idea that the FTC provides effective oversight of broadband providers is patently false. ISPs aren't lobbying to shift broadband regulatory authority back from the FCC to the FTC because it's fun. They're spending millions of dollars in lobbying to ensure they see less regulatory oversight than ever before. That this return to FTC authority is some kind of panacea is a canard most recently debunked by former FCC boss Tom Wheeler in an interview with Susan Crawford:

"In the Trump administration, people are talking about stripping regulatory power from the FCC, and essentially taking the agency apart (including moving jurisdiction over internet access to the Federal Trade Commission [FTC]). “Modernizing” the FCC is the lingo being used. What’s your thought about that?

It’s a fraud. The FTC doesn’t have rule-making authority. They’ve got enforcement authority and their enforcement authority is whether or not something is unfair or deceptive. And the FTC has to worry about everything from computer chips to bleach labeling. Of course, carriers want [telecom issues] to get lost in that morass. This was the strategy all along.

So it doesn’t surprise me that the Trump transition team — who were with the American Enterprise Institute and basically longtime supporters of this concept — comes in and says, “Oh, we oughta do away with this.” It makes no sense to get rid of an expert agency and to throw these issues to an agency with no rule-making power that has to compete with everything else that’s going on in the economy, and can only deal with unfair or deceptive practices.

Make no mistake: the goal is, again, less oversight of one of the least competitive, and most anti-competitive companies in America. Pai and Ohlhausen, as revolving door regulators are wont to do, go to comic lengths to try and pretend the broadband industry isn't a competitive mess:

"Others argue that ISPs should be treated differently because consumers face a unique lack of choice and competition in the broadband marketplace. But that claim doesn’t hold up to scrutiny either. For example, according to one industry analysis, Google dominates desktop search with an estimated 81 percent market share (and 96 percent of the mobile search market), whereas Verizon, the largest mobile broadband provider, holds only an estimated 35 percent of its market."

That's some lovely, cherry picked bullshit.

Most consumers lack the choice of more than one fixed-line broadband provider, and the looming wave of mergers and acquisitions (supported by both Pai and Ohlhausen) are likely to reduce competition even further. Again, you can choose to not use Gmail, Google search or Facebook. Most people have only one or two broadband providers to choose from, both of which are happily engaged in non-price competition with little to no incentive to behave. This lack of competition -- and the government's unwillingness to address this for fear of stifling AT&T, Comcast, Charter and Verizon campaign contributions -- is what triggered the entire net neutrality and privacy fracas to begin with.

Of course, there's something else the pair intentionally and comically avoid talking about in their treatise. And that's the fact that to gut FCC authority over broadband and shovel it back to an already-overburdened FTC, regulators need to roll back the Title II reclassification of ISPs as common carriers -- and by proxy the nation's net neutrality rules. Pai and Ohlhausen don't even utter the phrase "net neutrality" in their missive, knowing all-too-well that they'd be laughed out of town if they didn't try to hide their real objective under a parade of half-truths and prattle.

But make no mistake, this pretense that we need to shift broadband regulatory oversight back to the FTC because it provides a more "consistent regulatory environment" is a transparently self-serving, telecom industry-concocted canard -- and the opening salvo in what will be the death of net neutrality protections if we don't start paying closer attention.

Filed Under: ajit pai, broadband, competition, fcc, ftc, maureen ohlhausen, net neutrality, privacy

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  1. identicon
    Pixelation, 5 Apr 2017 @ 7:15pm

    Need to put in a correction

    You spelled his name wrong. It's Ashit Pai.

    You're welcome!

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