Acting FTC Head: Internet of Things Should Self-Regulate

The acting head of the U.S. Federal Trade Commission (FTC) under Donald Trump said that the agency is “not primarily a regulator” in a conversation with the Guardian on Monday.

Maureen Ohlhausen, the commission’s sole Republican and its acting chair under Trump, said the FTC was primarily a law enforcement agency and called for wait-and-see approach to enforcement during a discussion at a conference of cybersecurity professionals on Monday at the Nasdaq. She also defended the use of big data to offer consumers different prices for the same good and said she wanted manufacturers of internet-connected household devices to decide best practices among themselves.

Ohlhausen defended the airline and hotel industry practice of altering prices for some services based on consumer data in conversation with the Guardian, saying that such practices spurred competition. “Information can be used to target some consumers with a higher price, but the same information can be used to target some consumers with a better deal,” Ohlhausen said.

She recommended a voluntary set of standards suggested by an industry trade association called the broadband internet technology advisory group (Bitag).

Many technologists have called for industry standardization in Internet of Things (IoT) devices in the wake of the hack on internet backbone provider Dyn late in 2016, which was widely attributed to a single Chinese manufacturer of low-security webcams. Asked whether there should be mandatory regulations rather than suggestions from industry groups, Ohlhausen said, “We haven’t taken a position.”

“We’re saying not ‘Let’s speculate about harm five years out,’ but ‘Is there something happening that harms consumers right now or is likely to cause harm to consumers,'” Ohlhausen told the audience at the conference. If there is potential harm to consumers in a new technology, the FTC should not act until that harm manifests, she said: “We don’t know if that risk will materialize. It may well materialize, but a solution may materialize at the same time.”

While it is true that the FTC has not passed regulations of its own since the contact lens rule in 2004, it has often proposed that Congress pass legislation that would affect domestic trade. In 1975, Congress gave the FTC the authority to adopt industry-wide trade regulation rules; other commissioners have referred to themselves as regulators.

“We do have a few regulations and we’re looking to see if any need to be streamlined,” she said with respect to the Trump administration’s one-in,-two-out rule.


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