CTIA: Proposed privacy rules would harm competition, violate the First Amendment

CTIA struck back against the FCC's proposed privacy rules for Internet service providers -- including mobile network operators -- saying the Commission is overstepping its bounds and considering regulations that are "overbroad and harmful."

The Commission voted 3-2 along party lines several weeks ago to move forward with rules that would require ISPs to ask consumers to opt in to any sharing of their data with third parties and to disclose their policies for collecting and sharing data. The rules would also strengthen disclosure requirements when data breaches occur.

But the wireless trade group filed a massive, 196-page document last night urging the FCC "to reconsider most of its proposed rules because they will not protect consumers." The regulations would actually harm competition, according to CTIA, because they would apply only to ISPs, giving web-based companies such as Google and Facebook an unfair edge in online advertising. And the proposed rules exceed the FCC's purview, CTIA said, because they "attempt to sweep into the scope of the rules customer data beyond customer proprietary network information (CPNI), which is the specific data that Congress deemed worthy of protection.

"The proposed rules are overbroad and harmful in that they attempt to cover data that is not linked to consumers, which is valuable to businesses and society in the development of smart cities and other applications of big data that benefit consumers," CTIA wrote. The rules would also "harm consumers and competition because they fail to account for the sensitivity of data and the need for companies to adapt to changing technologies and consumer expectations."

Interestingly, CTIA also claimed the proposed regulations "are a prior restraint on valuable speech," violating the First Amendment.

Democrats maintain a one-vote advantage on the Commission. A Republican-controlled House committee earlier this week released a plan that would cut the FCC's budget by 18 percent and block its ability to enforce net neutrality rules, among other things.

The FCC has consistently claimed that its purview doesn't extend to so-called "edge providers" that supply content, applications or services over the Internet, like Google and Facebook. So while the rules would apply to mobile carriers that are increasingly looking to monetize their users' data through marketing and advertising, they wouldn't have an impact on websites or operating system developers such as Apple and Google.

"If the Commission is determined to move forward with rules governing broadband privacy, it should abandon its prescriptive approach, and instead, work with other regulators, such as the FTC and NTIA, to develop a flexible and technology-neutral approach, buttressed by a multistakeholder process," CTIA wrote. "CTIA appreciates the Commission's commitment to consumer privacy and the Commission's sense of urgency. But the problems in the NPRM would be fatal on appeal, and protracted uncertainty and litigation are not in the public interest."

For more:
- read CTIA's FCC filing

Related articles:
FCC moves forward with privacy rules for ISPs
Moody's: FCC's new privacy rules will hurt AT&T and Verizon's chances to compete with Facebook, Google
Mobile industry questions FCC's jurisdiction over proposed privacy rules, warns of market 'uncertainty'
AT&T, Verizon argue for ad-supported business models, while FCC mulls new privacy rules
Verizon to pay $1.35M to settle FCC investigation over 'super cookies'

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