Cable operators, which now control broadband service to the majority of U.S. homes, stand to reap significant benefits from congressional action rolling back rules that restricted oversight of their use of customer data.
The Republican-controlled House of Representatives voted 215-205 on Tuesday to endorse legislation repealing a set of privacy protections that were hallmarks of President Obama’s media policy. President Trump is expected to swiftly sign the bill.
The action is a victory for cable, satellite and telecom providers, which are moving aggressively to counter video subscriber losses with expanded broadband services. A lot of advertising dollars are at stake. The online advertising market, which overtook linear television’s this year, is projected to reach $83 billion this year, with the gap between digital and TV continuing to increase in coming years.
Following a similar action by the Senate, the House voted along party lines to free companies like AT&T, Comcast and Verizon from the limitations put in place in 2015. They had restricted what companies could do with customers’ location data, Social Security numbers, internet browsing histories and app usage. Under those rules, providers were also required to tighten security protection of customer data.
With Trump’s approval, providers will now be able to track customers’ online actions and supply their personal and financial data to advertisers, even without customer approval.
Cable executives have been openly embracing Trump’s anti-regulatory posture, seeking lighter regulation as a growth stimulant. Charter Communications CEO Tom Rutledge, who appeared at a White House press briefing last week with Trump, complained last month at a UBS investor conference that the cable industry had been “under relentless government assault” in the Obama era.
The Internet and Television Association (formerly the NCTA) hailed the action by Congress to undo what it called the earlier, “misguided” privacy restrictions. The vote “marks an important step toward restoring consumer privacy protections that apply consistently to all internet companies,” the trade group said in a statement.
FCC Chairman Ajit Pai also welcomed the move. “Until 2015, the Federal Trade Commission was protecting consumers very effectively,” he said in a statement (PDF).
Moving forward, “The FCC will work with the FTC to ensure that consumers’ online privacy is protected though a consistent and comprehensive framework. In my view, the best way to achieve that result would be to return jurisdiction over broadband providers’ privacy practices to the FTC, with its decades of experience and expertise in this area,” Pai added.
Under Wheeler’s guidance, the FCC had imposed its own privacy rules, apart from the FTC.