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Lina Khan Brings Scrutiny to Big Tech Data Dominance as FTC Chair

June 17, 2021, 9:01 AM

The Federal Trade Commission’s new chairwoman, Lina Khan, is expected to examine how consumer data collection contributes to the dominance of U.S. tech giants as the head of the agency.

Khan takes the helm at the commission as privacy advocates, including Consumer Reports and the Electronic Privacy Information Center, push for the agency to flex its enforcement powers and tap into its rulemaking abilities to safeguard consumer data.

Khan, previously a professor at Columbia Law School, has a reputation as an advocate of aggressive antitrust enforcement against big tech platforms. She’s tied consumer privacy to antitrust policy, with a focus on the way tech companies’ dominance depends on data and how that allows for its misuse.

The intersection of competition and privacy policy could test Khan’s views on potential tensions between the two, according to Justin Brookman, a former FTC official who’s now director of consumer privacy and technology policy at Consumer Reports.

Moves that promote tech company competition can sideline privacy and vice versa, he said, pointing to a recent decision by Alphabet Inc.'s Google to phase out third-party tracking cookies used to target ads online. The policy is seen as promoting privacy but hamstringing ad-tech companies that compete with Google.

“It will be interesting to see where Lina comes down on that” kind of privacy-competition conflict, Brookman said.

In her writing as an academic, Khan has pointed to “information exploitation” as a form of tech platform power that threatens consumer privacy. She’s also highlighted how tech company business models rely on data, and the pressure that puts on privacy.

Privacy Rules

Khan is poised to inherit an agency-wide rulemaking initiative launched by Rebecca Kelly Slaughter, who served as acting chair before Khan’s appointment.

Slaughter, a Democrat, is expected to stay on at the commission, along with two Republican members. Christine Wilson, one of the Republican commissioners, has shown a willingness to move forward with new rules protecting consumer data as lawmakers in Congress continue to debate the issue.

One item already on the commission’s agenda is an update to existing children’s privacy rules. The FTC is considering updates to its rules implementing the Children’s Online Privacy Protection Act, which gives parents control over what information online platforms can collect about their kids. Groups such as the Campaign for a Commercial-Free Childhood have also urged the commission to investigate app store enforcement of children’s privacy protections.

While it’s unclear whether Khan would pursue a new privacy rulemaking, her earlier work as an adviser to the FTC’s other Democrat, Rohit Chopra, could offer insight into her views. Chopra, who’s been nominated to lead the Consumer Financial Protection Bureau, has sought to make better use of the agency’s authorities.

In a paper written with Khan, Chopra advocated for the FTC to write new antitrust rules, rather than rely only on litigation and enforcement. It’s a strategy Khan could follow to broaden the commission’s work on competition as well as other areas like privacy, Brookman said.

Her appointment as chair could signal “a new era” of more aggressive action on data protection issues alongside the FTC’s work on antitrust, said John Davisson, senior counsel at the nonprofit Electronic Privacy Information Center.

“When you have monopolies, it removes the incentive for tech companies to provide privacy protections to consumers,” he said.

Merger Reviews

Davisson cited as an example Facebook Inc.‘s purchase of encrypted messaging platform WhatsApp. While encryption is a more privacy-protective approach, WhatsApp has drawn criticism lately for a new data-sharing policy with Facebook.

The FTC under Khan should consider the data privacy implications of proposed mergers, Davisson said.

That could mean rejecting corporate deals that risk eroding data privacy. The commission could also impose privacy-related conditions on mergers that it allows to go through, said Ryan Calo, a professor at the University of Washington School of Law.

Privacy concerns have come up as part of an FTC merger review before, Calo said. Former commissioner Pamela Jones Harbour disagreed with the agency’s 2007 decision to approve Google’s purchase of ad service DoubleClick, in part because of privacy concerns.

“What was a minority opinion in 2007 might become more mainstream in 2021,” with Khan as FTC chair, Calo said.

To contact the reporter on this story: Andrea Vittorio in Washington at avittorio@bloomberglaw.com

To contact the editors responsible for this story: Kibkabe Araya at karaya@bloombergindustry.com; Keith Perine at kperine@bloomberglaw.com

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