The FTC is using its consumer protection and anti-trust regulatory powers to begin a series of investigations against tech giants for selling users’ personal data to third parties.
Donald Trump’s transition team made clear that big changes are coming to the Federal Trade Commission, which, under Pres. Obama’s control of four of the five seats, gave Silicon Valley a pass on selling users’ personal data and ability to operate as monopolies and had the FTC sue Qualcomm to get lower chip prices for Apple iPhones.
President Trump informed Silicon Valley tech giants that there was a new sheriff in town when he engineered the April 2017 repeal of Net Neutrality broadband regulations adopted during Obama Federal Communications Commission control. The blatantly biased rules were best described as follows: “Everybody equal, but Google much more equal.”
With Trump successfully confirming all five members of the powerful regulatory agency to seven-year terms, conservatives now hold Section 5(a) of the FTC Act (§5) enforcement authority to “prevent persons, partnerships, or corporations … from using … unfair or deceptive acts or practices in or affecting commerce.”
The FTC sent letters on March 26 to AT&T, Comcast, Google Fiber, T-Mobile, and Verizon demanding that the internet service-providers (ISPs) disclose in granular detail any and all home and mobile data they provided to or received from third parties at any time.
All the major ISPs have denied selling or even sharing their users’ browsing histories and other sensitive information, but Ars Technica reported that T-Mobile, Sprint, and AT&T were selling their mobile users’ location data to third-party advertising brokers.
Chairman Joe Simons emphasized in limiting the ISPs to just 45 days to comply:
The FTC is initiating this study to better understand Internet service providers’ privacy practices in light of the evolution of telecommunications companies into vertically integrated platforms that also provide advertising-supported content[.]
The order mandates that each ISP will 1) provide detailed descriptions of the personal information they collect about consumers; 2) explain how the ISP integrates personal data acquired through different channels; 3) explain how data are stored to protect personal privacy; 4) what personal information is used for; 5) whether such information is disclosed to any third party; 6) identify each and every third party that has received personal information; 7) describe in detail the types of information disclosed to each third party; and 8) disclose if the ISP obtained personal information about users or consumers from third parties.
The FTC also wants to know if ISP customers were allowed a choice to opt in or opt out of having their personal information collected. The FTC wants to know if users were “ever offered different levels of service, quality of service, rates, pricing, rewards, or other incentives for consumers who opt-in to the collection of information about themselves, their devices, their communications, their viewing history, or their online activities.”
Simons gave notice that the initiative will be followed by hearings, workshops, and potential investigations. He warned that the FTC is exercising its power to “enforce against unfair and deceptive practices involving Internet service providers.”
Under the Obama administration, Silicon Valley tech giants prospered, and the annual “Reputation Quotient” review of the top 100 most admired U.S. corporations found tech achieving premier rankings in 2016. But after bankrolling the Trump “resistance” and numerous privacy scandals, the 2019 Reputational Quotient study revealed Facebook plunging 43 positions from number 51 to 94 and Google diving 13 spots from 28 to 41, as Americans now view Silicon Valley tech giants as untrustworthy monopolies.
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