House Digital Commerce Members Divide on Solution to Digital Ad Data Collection Problems

All lawmakers at Thursday's House Digital Commerce Subcommittee hearing on advertising industry digital data gathering practices agreed problems need to be addressed. There was a partisan divide in tone and tenor of lawmakers' questions to executives and consumer advocates, whose testimony mirrored written remarks (see 1806130074). Lawmakers from both parties frequently referenced the ongoing debate on the Facebook-Cambridge Analytica privacy breach issues (see 1806130057).

House Digital Commerce Chairman Bob Latta, R-Ohio, attempted to balance focus between benefits of the industry's practices, including “a more tailored online experience for consumers,” and “emerging, high-profile challenges,” including those arising from Facebook-Cambridge Analytica. He cited Interactive Advertising Bureau statistics that the “ad-supported internet ecosystem generated over $1 trillion to the U.S. economy” in 2016, and its more than 10 million ads often involve “online data collection and subsequent data targeting.” Those practices “can feel like an invasion of privacy or leave them wondering how much personal information about them is being sold” to bad actors, Latta said. He cited recent data breaches and digital ad fraud as areas of concern.

Subcommittee Vice Chairman Adam Kinzinger, R-Ill., emphasized his desire to enact “baseline protections that would balance both innovation and consumers' trust in the privacy of their sensitive online information.” Lawmakers “want the internet to continue to thrive, but we also don't want users to lose faith in the internet because their information is being used in an unanticipated or even a harmful way,” he said. Rep. Fred Upton, R-Mich., focused on self-regulation, including use of icons on ads to provide transparency and third-party validation of ad companies' compliance with standards.

House Digital Commerce ranking member Jan Schakowsky, D-Ill., largely panned ad industry data collection practices, saying she's “certainly noticed in my own experience that I'm being tracked online. I start to shop on a website and then next thing you know an ad for the very same product I was looking for turns up on a completely different website.” Most U.S. consumers “are realizing how little control they have over their own information” and many have taken “some steps to block tracking,” she said. “You are tracked regardless of whether you're on a computer, smartphone or tablet,” with IoT devices also potentially collecting data. “We have learned more and more in the past year about how Russia used targeted ads to spread disinformation and meddle” in the 2016 presidential election, and “targeted ads can also be tools for discrimination, Schakowsky said.

House Commerce Committee ranking member Frank Pallone, D-N.J., raised concerns about targeted ad practices, saying “contrary to industry claims, it is not always anonymous. Right now, anyone willing to pay can target advertising to a list of 20 names.” Numerous “middlemen” companies in the ad ecosystem “lurk in the background,” tracking “what websites we visit, what purchases we make, and even the movement of your mouse on the computer screen,” Pallone said. Rep. Debbie Dingell, D-Mich., said trust “is wearing thin” given recent privacy revelations. “Consumers don't understand how much that data is being used and how it can be used,” she said.

Trustworthy Accountability Group President Mike Zaneis emphasized the need to “set policy and self-regulatory principles based on principles and standards that everybody must meet” rather than tech-specific rules. He highlighted TAG self-regulatory activities, including certifying member digital ad companies as complying with standards on combating criminal activity. KPMG parent Wunderman Global Chief Privacy Officer Rachel Glasser stressed self-regulation has been effective, citing the Digital Advertising Alliance and Network Advertising Initiative work on transparency and improving industry privacy policies.

Consumers Union Director-Privacy and Technology Policy Justin Brookman urged Congress to “explore various options” for giving consumers better privacy protections related to advertising, saying self-regulatory efforts “have largely failed.” Legislation should require strong data security practices, simple and easy-to-use consumer choices and easy-to-understand information on companies' data collection practices, Brookman said. George Washington University public policy professor Howard Beales said it's “hopeless” to get consumers to understand “the gory details of how this works and make choices on a provider-by-provider basis.” The information, “however it's collected and by whoever it's collected, should not be used in ways that are harmful to consumers,” he said. “You need to figure out what harm you're worried about and figure out what's the best way to stop that harm specifically.”

Facebook Notebook

Former Cambridge Analytica contractor Aleksandr Kogan is among three witnesses set to testify at Tuesday's Senate Consumer Protection Subcommittee hearing on data privacy implications of the Facebook-Cambridge Analytica breach (see 1806130057), the Senate Commerce Committee said. The hearing is a follow-up to Facebook CEO Mark Zuckerberg’s April testimony (see 1804100054 and 1804110065). Kogan, a University of Cambridge lecturer, has been closely tied since March to the scandal (see 1803190056). NewCo CEO John Battelle and former FTC Chief Technologist Ashkan Soltani are also to testify at the hearing, which will begin at 2:30 p.m. in 253 Russell.

Pallone criticized Facebook for what he said is "continued lack of response" to questions raised during CEO Mark Zuckerberg's April testimony (see 1804110065). In a statement Thursday, Pallone said Zuckerberg "has thus far failed to ‘follow-up’ on the many questions he couldn’t answer during the hearing, and Facebook has not yet responded to many other questions staff asked at a briefing held two weeks prior to the public Committee hearing. Facebook’s refusal to respond is disappointing and frustrating, especially since some of our questions seem to have been partially answered in the press." He said the company also didn't respond to questions Commerce Committee Democrats submitted for the record after the hearing. He also said it's standard committee protocol for responses to be demanded within two weeks, but the Republican majority gave Facebook a longer response deadline of June 29. The social media platform emailed it's "working right now to provide substantive answers to the over 2,000 questions we received coming out of the April hearings. We shared responses to the Senate questions last week and look forward to sharing responses with the House by the June 29 committee-imposed deadline.”