The Federal Communications Commission voted to approve new privacy rules Thursday regarding how internet service providers, or ISPs, can use customer data, placing considerable limits on providers like Verizon and Comcast.
The 3-2 vote along party lines requires that these providers obtain consumers’ consent before sharing and using their web browsing and app history data for ad targeting and marketing, giving consumers unprecedented control over the use of their personal information.
The Association of National Advertisers, part of a coalition of marketing trade groups including the American Association of Advertising Agencies, the Digital Marketing Association and the Interactive Advertising Bureau that has consistently opposed the regulation, slammed the vote.
“They have clearly disregarded the heart of our discussions, that a vast amount of data that is browser and app use data is not sensitive data,” Dan Jaffe, group evp of government relations at the ANA, said in the immediate aftermath of the vote. “This is unprecedented, misguided and extremely harmful.”
FCC Chairman Tom Wheeler has been strongly advocating for the new rules for months, arguing that consumers must be in the driver’s seat when it comes to privacy decisions.
“There is a basic truth: It is the consumer’s information. It is not the information of the network the consumer hires to deliver that information,” he said. “What this item does is to say that the consumer has the right to make a decision about how her or his information is used.”
The telecom and the advertising industries, however, have bitterly opposed them, arguing that they will limit how companies can use data to provide innovative services. The coalition of marketing trade groups also voiced their concerns in a strongly worded letter to lawmakers last month.
“It is shocking that they’ve taken this step because it shows tremendous ignorance for how things work,” said Jaffe. “We’ve been very supportive of singling out job, health and financial information, but how is something as innocuous as me searching for the daily special at Safeway sensitive information?”
The vote most severely impacts internet service providers, but it will affect marketers too, who rely on consumers’ digital data for ad targeting and building consumer profiles. The FCC definition of sensitive information is far broader than the ad industry’s definition around health or financial information.
“Putting specific guardrails like this can really limit our ability to provide meaningful content as advertisers,” Azher Ahmed, evp and director of digital at DDB, had told Digiday earlier this month. “It’s like going back to the Stone Age in terms of advertising in a non-targeted way to a mass audience you know nothing about.”
Some people were more optimistic than others, though. Chad Wollen, CMO at network data company Smartpipe said that marketers must pick up the privacy mantle.
“While gaining consent for data collection and usage won’t be without its challenges, overcoming these is absolutely within the wheelhouse of a marketing department,” he said. “We need to focus on our brand relationships and engage in a dialogue with customers about the value of sharing information.”
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