FTC Commissioner Notes the Importance of Competition in the Privacy Legislation Discussion


FTC Commissioner Ohlhausen raises a good point re competition and privacy:

Ohlhausen added that new privacy rules could hinder competition by favoring entrenched companies that already have access to consumer data over new entrants that want to obtain such data.

“There are many benefits to information sharing for consumers such as reducing online fraud, improving products and services and increasing competition in the market overall,” Ohlhausen said. “So that’s why I am concerned about treating privacy solely as a consumer protection issue. It also must be viewed through the competition lens if you want to reach the best outcome for consumers.”

I speak regularly with start-ups and they are very concerned about having their start-ups “regulated out of business” by new privacy legislation. Being active in the mobile payments space, I would hate to see challenges to the financial services status quo be squashed by regulation. New economic models are being created and some bring cheaper prices to consumers.

I also found interesting this comment from Commissioner Ohlhausen:

“Before seeking new privacy legislation, I think it is important to identify a gap in statutory authority or to identify a case of substantial consumer harm that we would like to address but can’t within our existing authority,” she said.

One inference is that she believes the FTC has all the authority it needs. This is of note since the recent FTC report raised the concern of data brokers being beyond its reach. I suppose you could infer she doesn’t believe data brokers need to be regulated, but I’m not sure that would be a mainstream interpretation. I don’t think she would be that far out of step with mainstream thought.

It will be interesting to listen to the Commissioners statements for splits along party lines.

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