How should the Feds regulate tech? This US government watchdog is hitting the road for ideas

Hearings could presage tougher scrutiny of Silicon Valley in response to rising complaints

PUBLISHED : Thursday, 21 June, 2018, 10:57am
UPDATED : Thursday, 21 June, 2018, 10:57am

The Trump administration’s privacy, competition and consumer protection police plan to embark on a cross-country listening tour to gauge how academics and average Web users believe the US government should address digital-age challenges, from the rise of artificial intelligence to the data-collection mishaps that have plagued companies like Facebook.

The effort announced Wednesday by the Federal Trade Commission and its new chairman, Joe Simons, includes 15 or more public sessions in a series of cities that have yet to be announced. The hearings are expected to touch on a wide array of topics like the agency’s “remedial authority” to address privacy and security abuses, the potential risks posed by big data, and the commission’s tools to enforce antitrust laws as media, tech and telecom companies gobble each other up or seek to enter new lines of business.

The public outreach will begin in September and continue into January 2019, the agency said. It could presage tougher scrutiny of Silicon Valley in response to complaints that the FTC has been too soft on tech giants and the ways they collect, swap and manipulate personal information about billions of Americans.

“When the FTC periodically engages in serious reflection and evaluation, we are better able to promote competition and innovation, protect consumers, and shape the law, so that free markets continue to thrive,” Simons said in a statement.

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Simons has modelled the effort after an inquiry conducted by the FTC in 1995, the agency said, three years before Google had been founded and almost 10 years before the launch of Facebook. Those previous hearings similarly sought to gauge if the agency had the right tools to tackle issues that included the arrival of online shopping and the threat of digital fraud.

Back then, FTC leaders sought to “understand how antitrust law ought to apply to new dominant firms who got there often because they were the first to invent or first to implement a really good idea,” said Bill Baer, who served at the FTC during that period and much later became the top antitrust official at the Justice Department under President Barack Obama.

Two decades later, some of those same challenges remain. But FTC under Simons also faces significant pressure to rein in the power and footprint of the country’s tech giants. Privacy experts see the agency’s ongoing investigation of Facebook, for example, as a major test of the FTC’s ability and willingness to penalise Silicon Valley for its alleged misdeeds.

“Their budget is sort of insanely low,” said Michelle De Mooy, the director of the Privacy and Data Project at the Center for Democracy and Technology, a Washington D.C.-based think tank. She noted the agency is limited in the rules it can write on its own and the staff it can hire, too.

“Making sure they are able to be effective, now that they are faced with so many emerging technologies, is absolutely crucial for effective consumer protection,” she said.

For now, the road trip marks the first major initiative from Simons, an antitrust lawyer by trade who arrived at the agency in May along with a full slate of new Democratic and Republican commissioners.

Before his Senate confirmation, many lawmakers had pressed Simons on the extent to which he’d keep a close eye on the biggest tech companies in Silicon Valley. In response, Simons promised the FTC under his watch would be “vigorously enforcing the antitrust laws.”

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Along with privacy and security, Simons faces new demands – including from lawmakers on Capitol Hill – that the FTC stop big tech companies from getting bigger. Some members of Congress are specifically asking the FTC to reopen its investigation of Google, which the agency previously probed for antitrust violations but closed its investigation in 2013 without bringing any significant penalties. In the meantime, European regulators slapped Google with a major fine.

While those companies aren’t the explicit focus of the FTC’s forthcoming hearings, the agency could hear an earful about them. The goal, the agency said, is to explore whether “broad-based changes in the economy, evolving business practices, new technologies or international developments might require any adjustments to competition and consumer protection enforcement law, enforcement priorities, and policy.”