Privacy

Less is not more. That’s real “common sense.”

When one’s actions demonstrably create a worse rather than better outcome net-net, like the FCC’s new Title II ISP privacy policy does, others would justifiably consider it a mistake.

While the FCC obviously complied with President Obama’s call for regulating broadband as a Title II utility, the FCC obviously ignored President Obama’s 2011 call  for a 21^st century regulatory system, where he said we are “making it our mission to root out regulations that conflict, that are not worth the cost, or are just plain dumb.”

Let’s consider how the FCC’s new privacy policy fails this President Obama stated standard for “modern” regulation.

When the FCC reclassified broadband to be a Title II telephone utility last year in its Open Internet Order, the FCC trumpeted one of the great net benefits would be increased consumer privacy protection.

What’s a consumer to think about what the FCC’s responsibility is for their privacy protection?

Let me try to explain to a consumer what the Federal Communications Commission (FCC) arbitrarily has done, and apparently intends to do, for consumer internet privacy protection going forward.    

By way of background, for the first decade of the Internet when consumers used dial-up technology, the FCC was responsible for protecting consumers’ private network information from commercial use without their permission.

For the second decade of the Internet when consumers came to use broadband technology, the FCC ceded its dial-up-Internet privacy protection authority to the Federal Trade Commission (FTC) which became responsible for consumer privacy protection from unfair and deceptive practices consistently across the entire American Internet ecosystem, regardless of who interacted with consumers’ private information.

Last spring, in order to assert legal authority to enforce net neutrality to protect edge providers from potential traffic discrimination in the FCC’s Open Internet Order, the FCC incidentally clawed back some privacy authority over Internet communications -- over the FTC’s strong objections.

Does the impartial administration of justice, the integrity of the U.S. Government, and the oath of all federal employees to support and defend the Constitution of the United States, require that private interests not be allowed to supplant the public interest?

While the PR cover story of the FCC’s AllVid proposal may be about more consumer choice and competition to reduce the cost of cable set-top boxes, don’t be fooled.

In announcing it, the FCC Chairman admits there’s already consumer choice aplenty: “American consumers enjoy unprecedented choice in how they view entertainment, news and sports programming. You can pretty much watch what you want, where you want, when you want.”

And the AllVid proposal is not about saving consumers money.

If it were, the FCC would not be shunning the obvious, best and cheapest solution of replacing the need for a set-top box entirely, by modernly and naturally transitioning them to the sector norm of easily-downloadable, cheap/free apps.

Square peg meet round hole.

The FCC is poised to try and force-fit inherently-irreconcilable, telephone closed-ecosystem privacy rules into a broadband open-system Internet. Good luck with that.

Expect the FCC to have fits trying to successfully craft workable, non-arbitrary, and legally-sustainable Title II broadband privacy rules in the year ahead.

It is a problem of the FCC’s own making.

In arbitrarily applying Title II telecommunications rules to only the ISP half of Internet communications, while politically exempting the entire edge half of Internet communications in its Open Internet order, the FCC has ensured that information that was proprietary and controllable in the closed telephone world becomes public and uncontrollable in the open Internet world.

Horses meet open barn door.

Net neutrality activists wrongly imagined that Title II was all-purpose-regulatory-authority to impose “the strongest possible” Open Internet rules they wanted, like bans on paid prioritization, zero rating or usage based pricing, despite decades of Title II and court precedents that determine many types of economic price discrimination and pricing flexibility to be just and reasonable.

Summary:  Google Android’s >70% monopoly-size gross profit margins were made public for the first time when Android’s 2014 summary financials were disclosed in the Oracle v. Google copyright case (as evidence of Android’s commercial success to rebut Google’s claim that Android’s unauthorized use of Oracle’s Java APIs was “fair use” not commercial activity.) Combining this newly disclosed information with what we already know, Android likely generated a little less than a third of Alphabet’s 2015 revenues, but over a third of its 2015 gross profits. It is now clearer that the formal EU antitrust investigation of Android contractually tying Google’s dominant search to gain >80% share of the world’s smartphones will result in another EU Statement of Objections that could eclipse the current EU abuse of search dominance case in antitrust liability over time.  

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The EC’s Antitrust Chief, Margrethe Vestager, is signaling that some Big Data may be anticompetitive. She recently told a conference: "These incredible powerful tools, like search engines and social media, are available for free. In many cases, that's because we as consumers have a new currency that we can use to pay for them – our data. …If a company's use of data is so bad for competition that it outweighs the benefits, we may have to step in to restore a level playing field."

The issue of whether privacy/data protection violations can be anti-competitive in Google’s case is now especially ripe.

Summary

Does Alphabet Inc. -- arguably the world’s largest organization, with two billion plus users, most all the world’s information, most of the world’s top applications, limitless global ambitions, limited accountability, and self-proclaimed “don’t be evil” moral authority -- actually “do the right thing” as Alphabet publicly professes?  (Alphabet Inc. is the restructured company formerly known as Google Inc.)

If it matters to people that their leaders do what they say, to governments that corporate leaders obey the law, to the media that public leaders are honest to the public, and to the public that the leaders they trust are trustworthy, then this attempt to bring accountability to Alphabet-Google’s near unprecedented leadership, branding, and investment value has merit.

Accumulating evidence of Google’s amoral unaccountability certainly has merit and value to EU law enforcement and to U.S. State Attorneys General law enforcement, because it goes to whether or not Alphabet can be trusted to operate its business honestly and legally on its own; and to be trusted to make honest representations to law enforcement and the public.   

Google is the ringleader thwarting the FBI’s high priority to make smartphones subject to the Communications Assistance to Law Enforcement Act, CALEA, like all other communications technologies were before smartphones, so that the FBI can continue to wiretap, investigate and thwart terrorism (ISIS etc.), and crime, like it routinely did prior to the smartphone era.  

(Anyone that doubts Google is the de facto encryption ringleader, see the evidence here. And don’t miss the fourth segment of this analysis about how Google cleverly thwarted the FBI in lobbying for a de facto anti-CALEA, last-minute, change to the FCC’s Open Internet order.) 

How the FTC handles the EFF petition charging that Google has violated its enforceable pledge to protect K-12 students’ privacy will speak volumes to the world about two big things.

First, whether FTC Commissioners believe Google is subject to U.S. privacy law, or not.