Statement in Response to FTC’s Internet of Things Staff Report
WASHINGTON (January 27, 2015) – In response to the Federal Trade Commission (FTC) staff report “Internet of Things: Privacy and Security in a Connected World” released this morning, Daniel Castro, Director of the Center for Data Innovation, issued the following statement:
“While the FTC’s report correctly recognizes that the Internet of Things offers potentially revolutionary benefits for consumers and that the industry is still at an early stage, it unfortunately attempts to shoehorn old ideas on new technology by calling for broad-based privacy legislation. It is disheartening that the FTC staff has failed to propose a forward-looking regulatory approach to technology that narrowly targets actual harms while leaving companies free to innovate. In particular, in calling for companies to reduce their use of data, the FTC misses the point that data is the driving force behind innovation in today’s information economy.
As Commissioner Wright notes in his dissenting statement, the FTC staff have not performed sufficient analysis of the potential costs and benefits of their recommendations to justify intervention. Commissioner Ohlhausen also issued a statement echoing many of the same concerns regarding broad-based privacy regulation and the report’s endorsement of data minimization.
On a positive note, the FTC has joined others in calling for federal data breach notification legislation. Federal legislation offers the opportunity to reduce the compliance burden of companies that must follow many different state laws and allows them to focus more of their resources on improving security. Such legislation is sorely overdue. Following a string of cyberattacks last year, passing this legislation should be at the top of the agenda for the new Congress.
The best way to ensure the continued development of the Internet of Things and the broader data economy is to balance regulatory oversight with the need for continued innovation and technological development. While it does make some positive points the FTC’s report unfortunately fails to strike that balance.”