House Approves Bill to Overturn FCC Privacy Rule

By John D. McKinnon Congress Dow Jones Newswires

A lone worker passes by the U.S. Capitol Building in Washington, October 8, 2013. A few faint glimmers of hope surfaced in the U.S. fiscal standoff, both in Congress and at the White House, with President Barack Obama saying he would accept a short-... term increase in the nation's borrowing authority to avoid a default. REUTERS/Jason Reed (UNITED STATES - Tags: POLITICS) - RTX143RN

House lawmakers on Tuesday voted to overturn an Obama-era privacy rule for broadband providers, buoying telecommunications firms but potentially muddying consumer-protection standards.

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The vote, largely along party lines, was 215 to 205.

The rule, adopted by the Federal Communications Commission in the waning months of the Obama administration, required telecommunications firms such as Comcast Corp. and Verizon Communications Inc. to get customers' permission to market their app and web-browsing history to third parties. It was opposed by broadband providers, who said it could unfairly tilt the playing field in favor of internet rivals, such as Alphabet Inc.'s Google unit and Facebook Inc., which generally are regulated by another agency, the Federal Trade Commission, and face less stringent standards when it comes to consumers' data.

Congressional Democrats as well as consumer advocates complained on Tuesday that the rollback removes important legal protections for broadband-access customers. The bill "totally wipes out consumer protections" on the internet, said Rep. Anna Eshoo (D., Calif.).

But Republicans said substantial protections -- including federal law and policies adopted by the companies themselves -- remain in place, and consumers are adequately shielded.

"The FCC already has the authority to enforce the privacy obligations of broadband-service providers on a case-by-case basis," even without the rules, said Rep. Marsha Blackburn (R., Tenn.) during floor debate.

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Meanwhile, telecommunications firms say the change would restore fairness for them in comparison to internet companies.

Given the huge size of some internet firms, "unbalancing this playing field is an inherently bad idea," said Rep. Michael Burgess (R., Texas).

Republicans, including FCC Chairman Ajit Pai, also have said the privacy rules could discourage new investment in broadband infrastructure.

The White House issued a statement on Tuesday saying the administration "strongly supports" the rollback measure, and criticized the FCC rule for departing from the "technology-neutral framework for online privacy" established by the FTC.

The resolution was approved by the Senate last week, by 50-48.

It is unclear exactly what the rollback will mean, however, given the already-murky state of the law with regard to online privacy.

For years, the FTC oversaw consumer privacy on the internet for all types of firms. Then the FCC reclassified internet-service providers as common carriers, as part of its separate net-neutrality rules, which require the telecommunications firms to treat all internet traffic equally.

That reclassification meant that the FTC lost jurisdiction over the internet-service providers to the FCC. So the FCC set about adopting the privacy rules that Congress has now voted to overturn.

FCC officials say they will continue for the foreseeable future to oversee the internet-service providers, including their privacy practices.

"We want to recognize and vindicate consumers' uniform expectation of privacy," Mr. Pai said last week. FCC officials are working with the FTC to make the two agencies' standards basically the same.

But consumer advocates say the privacy regulation that Congress rolled back was the only interpretation of exactly what obligations the telecommunications companies have under federal statute. Without the rules, there is not much to guide the companies.

Other questions remain as well. For example, under federal law, the congressional rollback means the FCC cannot adopt "substantially similar" regulations in the future -- a concept that is little-tested and subject to debate. That could weaken the FCC's hand in adopting a replacement rule.

Whatever the legal consequences of Tuesday's rollback, the move has a likely political benefit for the FCC's Mr. Pai. He faces the task of winning Senate confirmation for a second term this year, and so far appears to be seeking to minimize controversies until that happens. The congressional vote means that he likely won't have to do as much to rewrite the privacy rules.