The Federal Trade Commission helped normalize and popularize the term “commercial surveillance.”
But is the current FTC “anti-advertising”?
“Definitely no,” said Michelle Rosenthal, a senior attorney in the FTC’s advertising division, speaking at the IAB’s public policy and legal summit on Monday in Washington, DC.
The FTC’s mission is to stop deceptive and unfair business practices in general, and that includes setting rules and parameters that target those exact types of advertising practices. It’s not personal, despite the ad industry remonstrances against the FTC’s exploration of new rules to address data practices.
“There need to be some kind of reasonable limitations for the companies that are doing wrong.” Rosenthal said.
IAB vs. the ANPR
What’s less clear, however, is exactly what form these reasonable limitations will take in the near future.
In the absence of a national privacy standard, the FTC launched a process in August, known as an Advanced Notice of Proposed Rulemaking (ANPR), to collect public comment on whether it should implement new rules to “crack down on harmful commercial surveillance and lax data security practices.”
The commission received more than 10,000 responses between August and the end of November, which it is sifting through now.
One of those more than 10,000 responses came from the IAB, which is unsurprisingly critical of the ANPR and questions the FTC’s legal authority to pursue its rulemaking at all.
In a press release in mid-November, the IAB bristled at the FTC’s attempt to redefine “the ordinary collection, aggregation and analysis of consumer data as commercial surveillance – a definition so broad, potential FTC rules could criminalize the internet itself.”
But despite the ANPR’s strong wording, the FTC isn’t trying to make up an entirely new body of law, according to FTC Commissioner Rebecca Kelly Slaughter. And she reiterated that the FTC can’t prohibit behavior that isn’t punishable through its existing enforcement powers.
“The FTC can’t take action based on vibes,” Slaughter said. “We have to take action based on a substantive record that’s in front of us.”
And that’s what the ANPR is about, she said. Even if the FTC doesn’t end up creating a new set of privacy-focused rules, all the information gathered during the process will serve as a comprehensive public record on a wide range of privacy issues.
“It’s an opportunity for everyone involved – advocates, champions, skeptics and everyone in between – to explain why they think this is happening in the market,” Slaughter said, “and why it’s good or why it’s bad.”
Not so scary?
But there’s been concern in the online advertising industry that the FTC is already sitting in the “why it’s bad” camp (“it” being data collection in general).
One reason for the industry’s sensitivity is the FTC’s use of the term “surveillance capitalism,” which is firmly in the lexicon now. Slaughter said she has heard people complain that the term is “pejorative and problematic.”
By the same token, though, “you could argue that ‘behavioral advertising’ is complimentary,” she said.
But there are more pressing matters for the ad industry to focus on beyond tone and word choice – like, for example, keeping tabs on the FTC’s recent actions.
In fact, if you want to know what the FTC is up to and what its priorities are, there’s no need to wonder. All you have to do is read the commission’s recent cases and enforcement orders to know it has its eye on data security and data minimization (Uber/Drizly), health data privacy (GoodRx and BetterHelp) and sensitive location data protection (Kochava).
The questions in ANPR are also a helpful guide to what’s on the FTC’s collective mind.
Which is why Slaughter said she’s puzzled by the ad industry’s negative reaction to the “scary” rulemaking process and simultaneous criticism that it’s being forced to grapple with legal uncertainty.
“I feel strongly that clearly articulated rules are a much better and fairer way to communicate in addition to what the law requires,” Slaughter said. “It’s better to be up front and clear about it and direct.”
