US lawmakers voted yesterday to loosen rules governing how internet service providers—companies such as AT&T and Comcast—can mine their customers’ data for advertising. The vote means the broadband and cable companies that deliver internet to homes and offices won’t have to get customer consent before using geolocation, web browsing history, and other information for ads and marketing.
The relaxing of privacy rules for these internet service providers (ISPs) repeals Obama-era regulations setting a higher bar for ISPs to protect customers’ privacy than websites. And it puts their regulatory regime closer to the rules governing the tech giants—the Facebooks and Googles of the world—that have grown hugely profitable thanks to targeted advertising.
The tech companies have introduced features that eat away at the margins of the largest ISPs, who are often also telecom conglomerates. These include services like free calls and instant messages sent over the internet, which means users don’t have to pay their phone companies for calls or text messages.
A similar tension over who gets to exploit user data has taken hold in Europe, in the debate over website cookies. European telcos want parity with tech firms over their ability to mine geolocation and other precise user data for advertising purposes. Cookies on websites are one way for companies to obtain that data, and telcos have lobbied hard to either have the restrictions on them dropped, or to extend the restrictions to tech companies. The EU is considering the latter path, with a draft law that places more compliance burdens on tech firms, including requiring consent for some forms of ad targeting.
Phone companies on both sides of the Atlantic are winning in their efforts to achieve parity with their wealthier tech brethren in how they can exploit customer data. As Senator Bill Nelson of Florida said during the debate, “This is a gold mine of data—the holy grail so to speak.” It’s a gold mine that tech companies have had access to for years; now telcos may finally get a crack at it too.
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