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Internet privacy could be priority in next Congress

By Cecilia Kang
Washington Post Staff Writer
Thursday, November 4, 2010; 12:10 AM

A key Republican lawmaker indicated Wednesday that Internet privacy could be a legislative priority in the next Congress, as a growing number of data breaches draw increased attention from federal regulators.

Rep. Joe L. Barton (Tex.), ranking GOP member of the House Energy and Commerce Committee, signaled the legislative push in a statement about his correspondence with Facebook executives on privacy issues.

"I want the Internet economy to prosper, but it can't unless the people's right to privacy means more than a right to hear excuses after the damage is done," Barton said.

Such an effort on privacy would mark an exception to the otherwise hands-off approach that the incoming GOP majority is widely expected to take toward issues affecting the high-tech and telecom industries, including regulation of broadband networks.

Action on many tech-related matters has been cast into doubt after Tuesday's defeat of Rep. Rick Boucher (D-Va.), who for years has been a force behind tech-policy legislation, particularly on privacy.

But lawmakers remain under increased pressure to move in the face of rising consumer concern about the safety of personal information online. Government regulators in the United States and abroad, meanwhile, also are preparing to take a more aggressive role in enforcing privacy rules.

The Federal Trade Commission has investigated several recent cases of mishandled data and is expected to release a report within weeks recommending a framework for new privacy laws and guidance for Web firms.

Regulators in Britain on Wednesday accused Google of violating privacy laws with its accidental gathering of e-mail and passwords from residential WiFi networks.

Google said Tuesday that it had settled a class-action suit brought by Gmail users whose contact lists were exposed through social networking application Google Buzz, which resides in the e-mail program.

Analysts say the desire to protect consumers' personal information is shared by Republicans and Democrats alike and could result in new legislation in the next two years.

"Tech issues are prominent right now, and the ones that will get passed are the ones where industries understand that it is in their best interest to compromise, rather than wage political war to forestall any action," said Amy Mushahwar, a privacy lawyer at Reed Smith. "Privacy is an example of a less partisan issue that has the potential for movement, as compared to the clearly partisan battles of network neutrality."

For Google, Facebook and other Internet firms, that spells increased pressure from Washington over how they collect and use consumer information.

Drafts of two House bills already have been circulated that would make it more difficult for advertisers and media firms to create profiles on users for behavioral advertising. But privacy experts say Republicans may seek a weaker version of those bills.

Boucher and Rep. Cliff Stearns (R-Fla.) released a draft privacy bill last spring that allows for data tracking but makes personal financial and medical data off limits unless voluntarily shared by users.

Stearns, the ranking GOP member of the Energy and Commerce subcommittee on communications, technology and Internet, is considered a likely successor to Boucher as the subcommittee chairman. He also is expected to continue to press for privacy legislation.

Paul Gallant, an analyst at the MF Global investment firm, called Boucher an influential figure who was widely regarded as a consensus-builder in Congress on contentious issues such as the reform of a $7 billion rural phone program.

Gallant said the changes to Congress will have the biggest effect on the Federal Communication Commission and its controversial push to regulate broadband networks - a welcome shift for companies such as AT&T, Verizon and Comcast whose armies pour millions of dollars into lobbying battles against new regulations.

Republicans likely will call FCC Chairman Julius Genachowski to Capitol Hill for hearings on regulatory efforts and threaten to withhold appropriations.

Gallant said the FCC likely will continue to pursue reforms of the Universal Service Fund for phone service to include money for expanding broadband networks. And Genachowski is expected to put his net-neutrality proposal to a vote, even though it likely will be challenged in federal court by opponents who will question the agency's ability to regulate Internet networks.

A Republican-led House will make those goals even harder.

"The FCC makes most of the key tech policy decisions in Washington, and there is no question that House Republicans want to limit FCC activism in telecom policy," Gallant said.

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