Three of the largest internet service providers (ISPs) in the US – Comcast, Verizon and AT&T – have in recent years spent well over $100bn acquiring companies like NBCUniversal, AOL, Yahoo and Time Warner.

One of the obvious goals of these acquisitions is to stake out a better position in the booming digital advertising market, which surpassed television ad spending last year in the US and is now worth more than $70bn annually.

But now, ISPs may have an even easier time realizing their digital advertising dreams thanks to the US House of Representatives and Senate voting to pass S.J. Res. 34, a measure that kills consumer broadband privacy rules that the Federal Communications Commission (FCC) enacted last October which required ISPs to get consumers to give them permission to collect sensitive data, including their browsing histories, geolocation data, and financial information. Additionally, the rules required ISPs to be more transparent about their data collection and sales practices.

US President Donald Trump is expected to sign S.J. Res. 34.

Once that happens, as DSLReport's Karl Bode notes, "there's arguably little to prevent ISPs from doing whatever they'd like with your personal information, including selling it to [third-party] companies."

Disappointment and outrage

Not surprisingly, many observers expressed disappointment and even outrage at the vote, which saw S.J. Res. 34 pass in both the House and Senate by a slim margin along party lines. According to the Electronic Frontier Foundation (EFF), once President Trump signs S.J. Res. 34 the internet is going to become a less friendly and potentially downright scary place for US consumers:

...big Internet providers will be given new powers to harvest your personal information in extraordinarily creepy ways. They will watch your every action online and create highly personalized and sensitive profiles for the highest bidder. All without your consent.

This breaks with the decades long legal tradition that your communications provider is never allowed to monetize your personal information without asking for your permission first. This will harm our cybersecurity as these companies become giant repositories of personal data.

It won't be long before the government begins demanding access to the treasure trove of private information Internet providers will collect and store.

While such dire predictions are not guaranteed to come true, most tech industry observers and experts have expressed significant concerns that the elimination of the FCC's privacy rules would leave consumers vulnerable. Indeed, it would appear that, absent a regulatory change of heart, ISPs will now be free to collect data, and sell and use it, without many restrictions.

So what happened? Members of the House and Senate recognized what was at stake. Democratic critics of S.J. Res. 34 warned that the measure would make ISPs "more powerful than Amazon and Google." And they raised the privacy implications. "Just last week I bought underwear on the Internet. Why should you know what size I take or the color?" Rep. Michael Capuano asked his colleagues during debate.

But Republicans who voted for S.J. Res. 34 expressed concern that the FCC's privacy rules "arbitrarily [treat] Internet service providers differently from the rest of the Internet" and thus represent "government intervention in the free market." They argued that this benefited search engines and social networks, namely Google and Facebook, who use their massive data troves with minimal restriction to dominate the digital ad market.

Of course, users can more easily choose not to use Google and Facebook than they can not to use an ISP, and there are steps they can take to limit tracking when they use internet services. On the other hand, ISPs have the unique ability to track every single site a customer visits, which is why there is so much disappointment and outrage over S.J. Res. 34.

The unfettered ability to use and sell that browsing history data will put ISPs in position to make big moves in the digital advertising market and for better or worse, nobody should expect them to delay.

Patricio Robles

Published 3 April, 2017 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

2556 more posts from this author

You might be interested in

Comments (0)

Comment
No-profile-pic
Save or Cancel
Daily_pulse_signup_wide

Enjoying this article?

Get more just like this, delivered to your inbox.

Keep up to date with the latest analysis, inspiration and learning from the Econsultancy blog with our free Digital Pulse newsletter. You will receive a hand-picked digest of the latest and greatest articles, as well as snippets of new market data, best practice guides and trends research.