New FCC decision limits ISPs use of customer data

Ethernet cable with lock

Last month, United States’ biggest telecom company, AT&T, ironed out the details of an $85.4 billion acquisition of Time Warner – another American media conglomerate. Though the deal hasn’t gone through quite yet, the merger – if finalized – will allow AT&T to offer their customers television content over the internet.

At first glance, this deal might seem like an innocent AT&T attempt at gaining a stronger competitive advantage over their competition, but if we look closer – many deeper areas of concern become clear.

It shouldn’t come as much of a surprise that AT&T isn’t out to provide the most content at the best price, but rather to maximize their own earnings and increase market share. This merger will allow the telecom giant to do just that.

Through this merger, AT&T will be able to tap into Time Warner’s enormous customer base, and infrastructure. Aside from further monopolizing the telecommunications industry and virtually guaranteeing an increase in service price, critics of the acquisition are concerned about a larger underlying issue of privacy.

While AT&T has been no stranger to spying on their customers in the past, and has even been exposed for selling data to local police departments, this deal would give them even more power over their users. The new media behemoth will have access to massive broadband network connections and state of the art data-mining operations that will allow for highly targeted ads.

AT&T, as well as other media giants, profit greatly by monetizing the personal (and often sensitive) information of their customers. And with more than 150 million screens across television and mobile, AT&T’s growing list of subscribers makes for a very fruitful revenue stream.

FCC’s latest policy is the light at the end of the tunnel

Though AT&T’s data mining ambitions are unsettling (and even terrifying), there is some good news. Just as the talks of the merger were spreading across the internet faster than a wildfire, a new decision by the Federal Communications Commission (FCC) might have thrown a wrench into the works.

Earlier last week, the FCC adopted a new safeguard that will require all internet service providers (including, of course, AT&T) to take better care of their customer’s private data. Under the new rules, customer information regarding precise geolocation, health, finances, children, and most importantly – piles of private information gathered from the monitoring of browsing habits and mobile app use, is to be classified as “sensitive.”

In short, this means that data-hungry ISPs like Comcast, Verizon, AT&T, and many others, will be limited in the extent to which they’re able to exploit their users’ data. The biggest change that the new FCC policy brings about is likely the fact that ISPs will no longer be able to use most of their customer’s information for marketing and ad-serving purposes unless they secure informed consent beforehand.

What this means is that users will need to “opt-in” before AT&T is able to use the buckets of sensitive information that have been previously harvested. Not only that, but all customers will be able to decide how (if at all) this data will be used by advertisers and other third parties.

Needless to say, the new policy has received a large amount of pushback and opposition from lobbying groups representing the cable industry. Aside from whining and stomping their feet, one trade group – the Association of National Advertisers – vowed to see the new rules “undone” in one way or another.

What’s next?

Until then, AT&T (and other media conglomerates) will need to accept the FCC decision, and oblige the new rules. Though the policy changes are a great start, privacy advocates claim that more work needs to be done – especially when it comes to ensuring that cable giants don’t mislead their customers into blindly signing away their sensitive data to advertisers.

At this point it’s uncertain what the FCC ruling will mean for the AT&T and Time Warner deal, but it’ll likely complicate things a fair bit. That being said, the Department of Justice might allow the deal to go through after outlining a few caveats about how the new AT&T + Time Warner behemoth will handle customer data. 

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