Government Report: December 3, 2010

AAF Government Report

December 3, 2010

Clark Rector Jr., Executive Vice President – Government Affairs

Privacy in Focus

The House Energy and Commerce subcommittee on Commerce, Trade and Consumer Protection conducted a December 2 hearing on privacy issues. David Vladeck, director of the FTC’s Bureau of Consumer Protection testified about the Commission’s just released report, Protecting Consumer Privacy in an Era of Rapid Change: A Proposed Framework for Businesses and Policymakers.

The Framework consists of three primary recommendations:

  1. Companies should build privacy into their everyday business practices, or as the Commission defines it, practice “privacy by design,”
  2. Companies should provide consumers with choices about data practices in a simpler more streamlined way,
  3. Companies should adopt measures to make their data practices more transparent to consumers.

Notably, while FTC supports a “do not track” system, it has not called on Congress to enact legislation. The Commission recognizes that do not track may come in many forms, and prefers that industry take the lead and develop robust and workable do not track mechanisms. The FTC has made it clear, however, that industry does not have an unlimited amount of time to provide a realistic option to consumers before the government will act. The FTC privacy report can be found here.

As has been previously reported, AAF is part of an industry group that has developed a new self-regulatory program for online behavioral advertising that we believe will meet the FTC’s criteria. The announcement of that program can be found here.

Many members of Congress have indicated their intent to introduce privacy legislation in the next session of Congress. Senator John Kerry, D-Mass. has said his bill will guarantee consumers have three nonnegotiable rights - that all companies adequately secure their personally identifiable information; that they are told in “clear and concise terms” what firms intend to collect, and why and how the data will be used; and that they be given a “simple mechanism” to opt out of the process. Kerry said he has not decided if his legislation will include a mandate for a do not track mechanism. Sen.-elect Richard Blumenthal, D-Conn., has said he will introduce privacy legislation that will include a do not track provision.

Congressman Ed Markey announced at the hearing that he will introduce legislation to mandate a do not track mechanism for children.

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House Republicans to Choose Committee Leaders

The House Republican Steering Committee is scheduled to decide December 7 who will lead key committees in the next Congress. Of particular interest to the advertising industry is the Energy and Commerce Committee. Rep. Joe Barton, R-Texas is seeking the chairmanship. However, the House GOP has a term limit of six years for committee leaders. Barton has been the ranking minority member of the committee for the last four years and was chairman for the two years prior. Rep. Fred Upton, R-Mich., Rep. John Shimkus, R-Ill., and Rep. Cliff Stearns, R-Fla. have also indicated interest in becoming chairman.

The AAF recently joined with the Council of Better Business Bureaus and other major advertising and marketing associations to unveil a major new self-regulatory program for online behavioral advertising. The program will give consumers control over much or little companies can anonymously track their interests for the purpose of delivering online behavioral advertising. The announcement of the new program can be found here

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Supreme Court Declines to Hear Speech Case

he U.S. Supreme Court has refused to hear a challenge to a Virginia regulatory ban on alcoholic beverage advertising in college newspapers (Educational Media v. Swecker). AAF filed a brief with the Court urging review of a lower court’s decision upholding the ban. While disappointing, the Court’s decision is not considered precedent for future cases.

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EU to Review Self-regulation of Food Ads

The European Union will review self-regulation of food advertising to children during an upcoming conference on nutrition December 8-9. The self-regulatory approach to advertising was first endorsed in 2005-2006, when the European Commission convened an ad hoc round table on advertising to define a 'best practice model' for self-regulation. The EU's Audiovisual Media Services Directive (AMSD) asks member states and the Commission to "encourage media service providers to develop codes of conduct regarding inappropriate audiovisual commercial communication" of foods and drinks high in fats, sugar and salt in and around children's programs.

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AAF Files Comments With the FCC

The Campaign for a Commercial-Free Childhood (CCFC) recently filed a petition with the Federal Communications Commission seeking to block a new cartoon on the Nicktoons cable network claiming the show is a program length commercial. The show, Zevo-3 is based on characters that were developed for comics distributed with Skechers shoes. The shoes play no role in the television show.

Should the Commission take action it could negate years of established, settled and effective policy in this area which insures a separation between programmatic and commercial content, while allowing the use of characters in commercial material. Countless fictional characters over many years have and do appear in television shows (and books and movies) as well as advertising. Should the CCFC prevail they would all be at risk.

Attached are the initial and reply comments that the AAF has filed with the Commission that detail the legal and precedential reasons the CCFC petition should be dismissed.

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