Another Tale of Two Hearings
Two Congressional hearings held at the same time Tuesday morning illustrate the body at its best and at its worst. The good hearing, in the Senate Judiciary Committee, dealt with burning questions about innovation, consumer privacy, and state overreach: “GDPR & CCPA: Opt-ins, Consumer Control, and the Impact on Competition and Innovation”.
This hearing featured two panels, one composed of activists and company representatives and the other of researchers. Senators approached the complex question of balancing consumer rights to privacy against consumer interest in free, innovative services and competitive marketplaces.
Privacy is a hard subject that’s easily swept aside when shiny new issues give Congress an excuse for letting it languish. The first Congressional hearings on Internet privacy were held the in the mid aughts, with little in the way of output (I testified in one such hearing in 2008.) This is a hard subject.
The Shiny New Thing
Net Neutrality offered a welcome distraction from the hard work of understanding a complex, emerging marketplace and installing appropriate guardrails. Congress saw it as an easy answer for ensuring that consumers gained the full benefit of the Internet without creating a monstrous marketplace dominated by rent-seeking monopolies.
In practice, net neutrality has proved impossible to protect with simple rules because it isn’t an appropriate baseline. We can’t demand that Internet Service Providers offer one-size fits all service plans when consumers, platforms, and applications have such varied needs. This issue has needed a baseline reset from the beginning.
The House hearing – “Legislating to Safeguard the Free and Open Internet” – demonstrated that there’s no resolution in sight. Congress needs to create a regulatory framework for the FTC to apply to the Internet, but the committee majority wants to cede the issue to the FCC, along with nearly boundless authority to punish companies for doing things that have never been unlawful.
Creating Division and Conflict
While the Senate hearing explored a range of genuine issues from AI to data brokers to consent, funding for niche news services, and defaults, the House hearing was little more than name-calling. One witness suggested that net neutrality is a racial issue, another attacked other witnesses, and a third pretended to be serving consumers when he really runs a business-to-business service. Only one witness – former FCC commissioner Rob McDowell – stuck to the policy questions.
The majority members were mainly upset about the minority’s insistence on a bipartisan approach, while the minority stressed the bills they’ve introduced that tend to echo language offered by the majority in the past. The majority’s approach is unlikely to pass the Senate or to secure White House approval.
The majority’s bill is too short to be meaningful, failing to address any of the nuance around the regulator’s authority or the instances in which disfavored practices may have beneficial uses. The hearing echoed themes discussed in 2005 when Democrats introduced their first blanket bans in traffic differentiation.
The Way This Should be Done
Net neutrality is a solution to a problem with very scant history: there have been fewer than five practices that obviously fit the common definitions, and all but one were resolved without regulatory action. The legitimate case was resolved by a consent decree in 2005.
Privacy violations, on the other hand, are problems with a very robust history, much of it quite decent (such as the Cambridge Analytica scandal). While Europe has largely followed the US on net neutrality, it has taken the lead on privacy protection.
By the end of the Senate hearing, it was manifestly clear that there are good ways and bad ways to address privacy violations. We can choke off the Internet’s primary revenue stream with pointless cookie warnings – as Europe has done – or generally forbid targeted advertising as California intends to do.
The Senate Simply Did Its Job
Or we can limit the dissemination of potentially sensitive data to virtually unregulated data brokers while permitting advertisers to focus ads to personal tastes as they’re doing now. Many consumers have emotional reactions to the “creepiness” of some advertising practices just as they’re nervous about tall tales of ISP discrimination.
But it’s the job of Congress to cut through the public relations cloud generally manufactured by self-proclaimed consumer rights advocates to the issues that actual consumers care about. We want access to free stuff, and we’re willing to share some data in return for it.
Privacy is a balancing and line-drawing exercise. Net neutrality is as well, but some of the more combative Democrats don’t see it that way. Perhaps their blindness is willful and perhaps it’s politically-driven. But either way, it’s not doing consumers or the Internet any favors.