Group of ad associations defends current U.S. data privacy regulatory framework

A coalition of advertising, marketing and media associations has asked the National Telecommunications and Information Administration (NTIA) to analyze current and proposed privacy law frameworks in a letter written in response to a call for public comment posted by the the federal agency in September.

Federal vs. state legislation. The group — which includes associations such as the Association of National Advertisers, the American Association of Advertising Agencies, American Advertising Federation and the Interactive Advertising Bureau — hopes that a federal law that will override state laws such as the newly passed California Consumer Privacy Act (CCPA). California is the first state to pass legislation modeled on the EU’s General Data Protection Regulation (GDPR), a wide-ranging, consumer-forward set of rules that carry harsh penalties. The CCPA is scheduled to go into effect in January 2020.

The letter suggests that letting states lead the way would create a fragmented patchwork of regulations.

What you need to know. In addition to asking the NTIA to run a cost-benefit analysis of proposed privacy frameworks (Google and the IAB have each released frameworks) and competing state solutions such as the CCPA, the group defends the existing privacy regulatory framework, saying it’s “based in part on the concepts of transparency and choice, and has enabled tremendous growth and innovation in the modern economy while protecting consumer privacy and giving consumers meaningful options for how data about them will be used.”

It calls for the NTIA to use a “reasonableness standard” when considering possible regulation that weighs potential outcomes such as harms and benefits, customer expectations and risk mitigation. “Unreasonable data practices should be specifically prohibited, while reasonable data practices should be expressly permitted and encouraged,” the letter said.

Why you should care. Personal data has become businesses’ most valuable commodity — an integral part of the business model for behemoths like Facebook and Google. Many advertisers and businesses are concerned about how “pro-consumer” laws like the recently passed CCPA will affect their ability to use data. As the idea of a federal law appears to be gaining traction, firms like Facebook, Google, IBM, Microsoft have stepped up their lobbying efforts, hoping that the government will implement rules that recognize how important data is to their businesses.

The implications of a federal data privacy law don’t just affect the big guys. It has potential implications for all digital advertisers in terms of data available for targeting. And any business that collects or processes data should be watching how this unfolds here and keeping an eye on how GDPR plays out in Europe.