PFF to FCC: Opt Out of Opt-In
Comments Urge Free-Market Approach to Use of Information

WASHINGTON, DC � Mandated opt-in rules are bad for the economy and bad for consumers, and the Federal Communications Commission should avoid making policy that requires them.  That�s the message that Progress & Freedom Foundation President Jeffrey Eisenach, Vice President for Research Thomas Lenard, and Adjunct Fellow Jim Harper send in comments filed with the FCC.  The comments respond to a filing by the Electronic Privacy Information Center (EPIC) and other groups.

�The free flow of commercial information has substantial benefits for consumers and is important to the functioning of competitive markets,� the scholars write.  �The impact of an opt-in regime would be to severely curtail the availability of Customer Proprietary Network Information (CPNI) for marketing purposes and thus curtail consumer choice and accrue to the detriment of consumers.�  The authors cite testimony to the Federal Trade Commission and state that �requiring opt-in would dramatically reduce the amount of information available to the economy and would impose substantial costs on consumers.�

The comments cite Lenard�s newly-published book, Privacy and the Commercial Use of Personal Information, co-written with PFF scholar Paul Rubin, which states that ��[r]egulation that raises the costs of advertising  and obtaining customer lists would have an adverse effect on new entrants . . . [because] advertising typically benefits new entrants.�

The three scholars conclude that �the Commission should recognize that there are myriad benefits to consumers from permitting firms to put information about their customers to work to provide better services and facilitate entry into new markets.  It should choose the least restrictive option available in regulating the collection and use of CPNI, and reject proposals to reinstate an opt-in requirement.�

Eisenach is PFF�s co-founder and President.  Lenard is PFF�s Vice President for Research, and a Senior Fellow.  Harper is the founder and Editor of Privacilla.org, a Web-based privacy policy think-tank, and the Principal of Information Age public policy consulting firm PolicyCounsel.Com.  The Progress & Freedom Foundation studies the impact of the digital revolution and its implications for public policy and is a 501(c)(3) nonprofit organization.

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