Comments by Aurelien Portuese at the FTC's Open Commission Meeting

Aurelien Portuese October 21, 2021
October 21, 2021

Dr. Aurelien Portuese, Director of ITIF’s Schumpeter Project on Competition Policy, made the following comments to the FTC’s October 21, 2021 Open Commission Meeting:

I would like to make two points about consumer privacy that the FTC should consider in order to promote, not stifle, innovation.

First, it the popular claim that “consumers pay with their data” is plain wrong.

  • Of course, many companies monetize data. But there is no monetary transaction from consumers to the company. Quite the contrary: consumers often have discounts and free services thanks to the data they generate.
  • Consequently, there is no consumer harm under antitrust laws when companies monetize consumers’ data. There are consumer benefits thanks to this monetization via the provision of free products and services.

Second, establishing sector-focused privacy laws for ISPs is neither needed nor beneficial. An ITIF analysis showed that the major ISPs have strong privacy policies that allow consumers to opt out. Rather than craft an ISP-specific privacy rules, Congress should pass a national privacy law that preempts states and sets baseline standards for the whole economy.

Consequently, the FTC should advocate for a national privacy law that applies to all U.S. companies instead of being willing to unilaterally enforce sector-specific privacy standards that would distort competition across industries.

Thank you for considering these remarks and for having given me the opportunity to speak today.