Statement on President Trump’s signature to S.J. Res. 34

The American Legislative Exchange Council would like to thank President Trump and members of Congress for passing S.J. Res. 34, which nullifies former FCC Chair Tom Wheeler’s ISP Privacy Rule. The resolution, in addition to nullifying the rule, will ensure the FCC cannot select winners and loser in the Internet space for the near future.

The FCC’s rule did little, if anything, to protect consumer privacy. Instead, it created an unfair playing field, requiring ISPs to jump through a number of bureaucratic hoops just to offer basic services while benefiting big data companies.

The rule placed significant burdens on ISPs, while permitting big data companies, such as Google, to continue offering services unencumbered by overregulation. In addition to providing an edge to the likes of Google, the privacy rule failed to protect consumer data by assuming ISPs utilize the same technology and methods they did a decade or more ago and by focusing privacy standards on the type of company collecting data, rather than on consumer data.

Changes in internet technology, the advent of tablets, smartphones and other electronic devices, combined with an ever increasing number of locations at which to access the Internet means no single ISP has a thorough picture of a consumer’s Internet browsing habits.

For those who supported former Chairman Wheeler’s rule, it is also disingenuous to ignore the role big data companies play both in protecting consumer data and in monetizing data. Big data companies have a much broader picture of a consumer, from his browsing habits to his email and documents, to his payment methods, than for which ISPs could hope.

The President’s signature to S.J. Res. 34, nullifying former FCC Chairman Wheeler’s privacy rule is a step in the right direction, toward refocusing protections back onto the consumer rather than the type of company, and toward recognizing modern Internet technologies.

Other Points

• This is not the end of privacy protections. First, the FTC already enforces privacy standards when companies are caught violating standards. Second, many states have agencies policing privacy practices. Third, the FCC and FTC will work together to create privacy standards focused on the consumer, rather than companies. By working together, the two agencies will be able to craft standards applicable to all providers, including big data companies.
• Former Chair Wheeler’s privacy rule would likely have interfered with state privacy regulations. The rule preempted state regulations that were less than, or inconsistent, with the FCC’s proposed standards. Many states have regulations, or laws, establishing standards for ISPs, big data, and/or other Internet-related companies.
• The rule has not been implemented. Former Chair Wheeler’s rule was finalized in December and was set to take effect on March 1 or 2. The current FCC decided to delay implementation while it considered a variety of requests to reconsider the rule. The congressional vote and Presidential signature merely maintain the status quo.
• By repealing the privacy rules using the Congressional Review Act (CRA), the FCC will not be permitted to promulgate similar rules in the future.

Additional Reading

Senate was right to block FCC’s broadband privacy rules

How the FCC’s ISP Privacy Rule has an Eye toward the past, Not toward the Present or Future

How the FCC’s ISP Privacy Rule Focuses on the Wrong Thing

Former FTC Officials Provide Their Perspective on the FCC’s Proposed ISP Privacy Rules

Why the FCC’s Plan to “Protect” Consumer Privacy is Misguided