Washington, Digital Advertising and Competition

[Commentary] The Federal Communications Commission is conducting a rulemaking proceeding right now in which the agency explains that it is trying to come up with additional regulations for Internet service providers (ISPs) that will protect consumer privacy online. It's a compelling sound byte, but upon closer examination of the FCC's proposal, it appears the agency's focus is on shaping the digital advertising market, not protecting privacy.

The stakes are high among the existing, dominant players so it is not surprising that the FCC wants to wade in. But it is surprising that the FCC seems to want to shield the dominant players from additional competition, an odd motivation when you read the continuous stream of FCC releases on any number of issues heralding its laser focus on increasing competition, not minimizing it. The only thing that the FCC's proposal will do is distort the digital advertising market and protect the dominant market position of the existing providers – the very anathema of American competition policy. Everyone is clear that the "privacy as a currency" business model is here to stay. Let's expose it to more rather than less competition and let's give Americans what they want – a consistent, comprehensive regime that protects them as well online as anywhere else.

[Roger Entner is founder and lead analyst at telecom consulting firm Recon Analytics]