The Federal Communications Commission (FCC) has faced intense opposition to its proposed privacy rules for internet service providers (ISPs) – and debate is expected to escalate very soon. The U.S. Senate Committee on the Judiciary begins its review of the proposal tomorrow.
Originally released April 1, 2016, the 147-page Notice of Proposed Rulemaking requires ISPs to acquire customer consent before using customers’ data for certain purposes and mandates that ISPs take additional steps to protect customers’ personal information. According to FCC Chairman Tom Wheeler, “[the] proposal would give all consumers the tools we need to make informed decisions about how our ISPs use and share our data, and confidence that ISPs are keeping their customers’ data secure.”
Under the proposed rule, customers’ data is separated into three categories with each category requiring a different type of consent from a customer in order for the ISP to share or use the information. According to the proposed rule, consumers inherently consent to allowing ISPs to use data necessary for the use and marketing of broadband services by creating a customer-ISP relationship. However, all other customer data would be subject to an opt-out or an opt-in consent. Specifically, ISPs would be allowed to share consumer data with its affiliates and use the data to market communications-related services unless the customer affirmatively opted out. But ISPs would be barred from using or sharing the customers’ data for all other purposes unless the customer affirmatively opted in.
Additionally, if enacted, the rule would also require ISPs to adopt reasonable safeguards to protect consumers’ information including mandatory reporting obligation for data breaches. Under the proposed rule, if a data breach occurs, ISPs would be required to inform the FCC within 7 days and the affected customers within 10 days of discovery. If the breach affected more than 5,000 customers, the ISP must inform the FBI and Secret Service with 7 days.
Since the FCC announced the proposed rule, the FCC has faced strong opposition from members of the telecommunications industry who believe the proposed rule undercuts ISPs’ ability to create and market new projects. Additionally, the proposed rule is seen as putting ISPs at a competitive disadvantage by requiring ISPs to obtain affirmative consent to use data when companies who host websites are not required to follow the same rules. According to a press release by the CTIA-The Wireless Association, “The FCC’s desired approach would distort competition, confuse consumers and undermine consumer privacy in the mobile economy.”
The debate over the FCC proposed rules is likely to intensify in the coming weeks. The U.S. Senate Committee on the Judiciary will be hosting a session examining the new rules on Wednesday, May 11, 2016, and the FCC will continue to accept comments on the proposed rule until May 27, 2016.