News Corp. Investigation Calls Mount
The House Energy & Commerce Committee's Communications and Commerce subcommittees teamed up on the latest in what has become a veritable parade of Hill hearings on Internet privacy, this one hosting the chairman of the FCC, the head of the National Telecommunications & Information Administration, and a Federal Trade Commission member.
There are a number of online privacy bills circulating on the Hill, including do not track legislation (senior and junior versions), a privacy bill of rights and on data breach security and notification. And according to Rep. Henry Waxman (D-Calif.) yet another bill is in the offing that would apparently better define the sensitive personal information that would get heightened protection.
The online privacy issue has become more high-profile with the rise of broadband as a place for entertainment and commerce and education and healthcare and all the national purposes the FCC has been promoting in its National Broadband Plan.
Among the issues on display at the hearing was a gap in the FCC's privacy enforcement authority.
Asked by Rep. Anna Eshoo (D-Calif.) whether the FCC has authority under current law to ensure customer info is not being sold to third parties or used for their own marketing efforts, FCC Chairman Julius Genachowski said that was an area of the Communications Act where clarification "would be helpful," adding that "there is uncertainty and unpredictability about that now." When asked whether he needed legislative clarification, Genachowski first said yes, then backtracked and said it would be "helpful." The chairman was not looking to suggest that the FCC did not have the authority. Instead, he said, clarification would clear up any uncertainty.
FTC Commissioner Edith Ramirez said that when it came to privacy, the FTC should have jurisdiction over telecom
carriers, while Genachowski said he respectfully disagreed. "There is a longstanding issue here," he said. "We disagree with our friends at the Federal Trade Commission on this point. The FCC brings years of experience and expertise operating under congressional statues with respect to network wired and wireless," he said, "and privacy issues around them. That system has worked well and any revisions to the statutory framework [should] continue to take advantage of this long history of expertise." He said the two agencies have worked well together. A number of legislators at the hearing expressed interest in consolidating oversight under one agency.
Asked by Rep. Pete Olson (R-Tex.)if it was true that, "today, the FCC and FTC would have jurisdiction over the download of a video on demand from a cable company but only the FTC would have jurisdiction over the download of a video from an over-the-top provider like Netflix?" Genachowski said that was about the size of it.
But the primary dividing line at the hearing was between Democrats and Republicans over whether there was a clear and present online danger that demanded a legislative response.
With the exception of Joe Barton (R-Tex.), who agreed with Democrats, Waxman, Ed Markey (D-Mass.), Rep. Anna Eshoo and other Dems that it was time for legislation, Republican members, led by Mary Bono Mack (R-Calif.), chair of the Commerce Subcommittee, and Rep. Greg Walden (R-Ore.), chair of the Communications Subcommittee, counseled caution. Walden said that the hearing, and the ones that are scheduled to follow were about what, if any, legislation might be needed.
Bono pointed out that this was the first in a series of hearings on the issue, suggesting proposed legislation needed thorough vetting. Other Republicans pushed for an actual showing of the harms that necessitated a do-not-track bill, and for a cost-benefit analysis on privacy regulations given the potential impact on the online advertising model that underwrites free online content.
NTIA chief Larry Strickling agreed that a balance needed to be struck and emphasized establishing basic privacy principles, with industry handling the best way to achieve them.
Rep. Marsha Blackburn (R-Tenn.) said that the committee needed to tread carefully so as not to discourage innovation. She suggested a "thoughtful, cautious and well-measured pace was the best way to get to the shared goal of giving consumers more control over their sensitive online information.
She pointed out that with online ad revenues at $31 billion last year globally, and that money sustaining "much of our free press and content online," government needed to be mindful of creating an ill-defined standard of online harms that could place costs on an industry that is growing by "leaps and bounds."
By contrast, Democrats (and Barton) suggested they did not want those leaps and bounds to constitute trampling consumer rights to privacy.
Waxman said that while Republicans are wary of any new regulations, self-regulation isn't working. He cited a study showing some advertisers were violating their own privacy policies. And as for Republicans not being sure that regulation is needed. "It is well past time to move ahead," he said.
But not all Republicans were unsure. Barton, co-chair of the House Privacy Caucus, agreed it was past time for regulation. That is not surprise since he is co-sponsor with Ed Markey (D-Mass.) of a bill that would boost online protections of kids and minors, including prohibiting targeted online advertising to teens and kids. FCC Chairman Julius Genachowski and NTIA Chief Larry Strickling were both supportive of the prohibition, with Genachowski saying it was "appropriate" to protect kids and teens online.
"I agree it is time to act," said Barton. While he recognized the need for a vigorous Internet and a vibrant economy, he said, there was also a need to protect privacy in the Internet age.
The Waxman-Eshoo bill came to light when Republicans asked what bill he was talking about when he referred to l providing more specificity on sensitive information.
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