The technology industry might enjoy light-touch regulatory landscapes, but change is on the horizon with what appears to be an attempt to be the master of its own fate.
In an open-letter to senior members of US Congress, 51 CEOs of the technology and business community have asked for a federal law governing data protection and privacy. It appears to be a push to gain consistency across the US, removing the ability for aggressive and politically ambitious Attorney Generals and Senators to create their own, local, crusades against the technology industry.
Certain aspects of the framework proposed to the politicians are remarkably similar to GDPR, such as the right for consumers to control their own personal data, seek corrections and even demand deletion. Breach notifications could also be introduced, though the coalition of CEOs are calling for the FTC to be the tip of the spear.
Interestingly enough, there are also calls to remove ‘private right of action’, meaning only the US Government could take an offending company to court over violations. In a highly litigious society like the US, this would be a significant win for any US corporation.
And while there are some big names attached to the letter, there are some notable omissions. Few will be surprised Facebook’s CEO Mark Zuckerberg has not signed a letter requesting a more comprehensive approach to data privacy, though Alphabet, Microsoft, Uber, Verizon, T-Mobile US, Intel, Cisco and Oracle are also absent.
“There is now widespread agreement among companies across all sectors of the economy, policymakers and consumer groups about the need for a comprehensive federal consumer data privacy law that provides strong, consistent protections for American consumers,” the letter states.
“A federal consumer privacy law should also ensure that American companies continue to lead a globally competitive market.”
CEOs who have signed the letter include Jeff Bezos of Amazon, Alfred Kelly of Visa, Salesforce’s Keith Block, Steve Mollenkoph of Qualcomm, Randall Stephenson of AT&T and Brian Roberts of Comcast.
Although it might seem unusual for companies to be requesting a more comprehensive approach to regulation, the over-arching ambition seems to be one of consistency. Ultimately, these executives want one, consolidated approach to data protection and privacy, managed at a Federal level, as opposed to a potentially fragmented environment with the States applying their own nuances.
It does appear the technology and business community is attempting to have some sort of control over its own fate. As much as these companies would want a light-touch regulatory environment to continue, this is not an outcome which is on the table. The world is changing but consolidating this evolution into a single agency the lobbyists can be much more effective, and cheaper.
The statement has been made through Business Roundtable, a lobby group for larger US corporations, requesting a national consumer privacy law which would pre-empt any equivalent from the states or local government. Definitions and ownership rules should be modernised, and a risk-orientated approach to data management, storage and analysis is also being requested.
Ultimately, this looks like a case of damage control. There seems to be an acceptance of regulation overhaul, however the CEOs are attempting to control exposure. In consolidating the regulations through the FTC, punishments and investigations can theoretically only be brought forward through a limited number of routes, with the companies only having to worry about a single set of rules.
Consistency is a very important word in the business world, especially when it comes to regulation.
What we are currently seeing across the US is aggression towards the technology industry from almost every legal avenue. Investigations have been launched by Federal agencies and State-level Attorney Generals, while law suits have also been filed by non-profits and law firms representing citizens. It’s a mess.
Looking at the Attorney Generals, there do seem to be a couple who are attempting to make a name for themselves, pushing into the public domain. This might well be the first steps for higher offices in the political domain. For example, it would surprise few if New York Attorney General Letitia James harbours larger political ambitions and striking a blow for the consumer into Facebook would certainly gain positive PR points.
Another interesting element is the fragmentation of regulations to govern data protection and privacy. For example, there are more aggressive rules in place in New York and California than in North Carolina and Alaska. In California, it becomes even more fragmented, just look at the work the City of San Francisco is undertaking to limit the power of facial recognition and data analytics. These rules will effectively make it impossible to implement the technology, but in the State of Illinois, technology companies only have to seek explicit consent from the consumer.
Inconsistency creates confusion and non-compliance. Confusion and non-compliance cost a lot of money through legal fees, restructuring, product customisation and fines.
Finally, from a PR perspective, this is an excellent move. The perception of Big Business at the moment, is that it does not care about the privacy rights of citizens. There have been too many scandals and data breaches for anyone to take claims of caring about consumer privacy seriously. By suggesting a more comprehensive and consistent approach to privacy, Big Business can more legitimately claim it is the consumer champion.
A more consistent approach to regulation helps the Government, consumers and business, however this is a move from the US technology and business community to control their own fate. This is a move to decrease the power and influence of the disruptive Attorney Generals and make the regulatory evolution more manageable.
Momentum is gathering pace towards a more comprehensive and contextually relevant privacy regulatory landscape, and it might not be too long before a US version of Europe’s GDPR is introduced.