ANA Says FCC’s Online Privacy Proposal is Seriously Flawed

The Association of National Advertisers (ANA) today expressed strong opposition to a new proposal by the Federal Communications Commission (FCC) to impose onerous new opt-in privacy requirements on broadband internet service providers (ISPs). In comments to the Commission, ANA stated that the agency’s proposed rules “represent a dramatic and counterproductive expansion of the FCC’s jurisdiction over privacy matters and could severely curtail effective online advertising.”

“The FCC’s proposal is potentially damaging to the entire online advertising ecosystem,” said Dan Jaffe, Group Executive Vice President of Government Relations for ANA. “This attempted regulatory overreach by the FCC is not necessary. Existing privacy self-regulatory programs such as those carried out by the Digital Advertising Alliance are working well and already provide consumer transparency, notice and choice for interest-based advertising.”

The ANA comments point out the proposal’s very serious adverse effects for online marketers, content creators and, crucially, consumers. These include:

  • Creating an online ecosystem that is less protective for consumers and would cause them to be barraged with intrusive, annoying privacy pop-ups online and over their mobile phones;
  • Furthering the potential to accelerate movement of content from web publishers behind paywalls;
  • Increasing the potential for ISPs to raise subscription rates due to lost advertising revenue;
  • Discouraging ISPs from developing new business models and connecting consumers with new products and services;
  • Threatening to impose increased costs and complexities for marketers that rely on information from ISPs to provide interest-based advertising to consumers; and
  • Providing less relevant advertising to consumers in the online and mobile marketplace.

Jaffe noted, “Digital advertising, including interest-based advertising, is a growth powerhouse that supports much of the freely available content online. The Commission has not provided any evidence to demonstrate that interest-based advertising could result in any tangible harm to consumers. Their proposed opt-in regime, which makes no distinction between sensitive and non-sensitive information, is highly misguided and unjustified.”

ANA’s comments state that the FCC’s proposal violates the First Amendment commercial speech rights of ISPs and other marketers: “Under the proposed rules, ISPs would be prohibited from using information in their possession to market non-communications-related services without consumers’ opt-in consent. This constitutes a serious restriction on speech tailored to a particular audience, or targeted speech.” Jaffe noted, “The FCC’s proposal is far more restrictive than necessary and the Commission failed to adequately consider a substantially less restrictive alternative, an opt-out strategy. The Courts have made clear that these types of restrictions violate the Constitution.”

Jaffe concluded, “The Commission should not attempt to fix something which is not broken. The industry has designed strong privacy self-regulatory programs, buttressed with enforcement by the Federal Trade Commission and state attorneys general, are an effective framework that provides consumers with the ability to control how information about them is collected and used. The FCC’s proposal clearly does not promote the public interest and should not be adopted.”