Multistakeholder Process Needs to Represent Those Not Directly Involved

Multistakeholder Process Needs to Represent Those Not Directly Involved

Lenard Submits Comments to NTIA on Data Privacy Code of Conduct

Contact: Amy Smorodin
(202) 828-4405

April 2, 2012 – The privacy code of conduct developed by the National Telecommunications and Information Administration (NTIA) multistakeholder (MSH) process will apply to many more consumers and firms than can be directly involved in the process. Therefore, code provisions should be analyzed in much the same way as a regulation in order to assure that they produce benefits in excess of costs, states Thomas Lenard in comments filed today with the National Telecommunications and Information Administration. By adopting a process for cost-benefit analysis, the agency can ensure the interests of all stakeholders, including present and future Internet users, are represented.

In his comments, Lenard, President and Senior Fellow at the Technology Policy Institute, explains that the code of conduct produced by the MSH process will be similar to agency guidance. Such guidance documents are subject to the regulatory review requirements of Executive Order 12866, which include “a reasoned determination that its benefits justify its costs.” A cost-benefit analysis of privacy code provisions would make explicit the tradeoffs between more privacy and making more information available for free online services, fraud detection, and other uses.

Lenard also states that “because the process will be driven by stakeholders, it needs to be sensitive to the potential for anticompetitive behavior.” NTIA and the MSH process should ensure any privacy code is neutral with respect to technology, business models and organizational structures. In addition, procedures should guard against the process and resulting code being dominated by incumbents, which could raise the costs of entry and inhibit innovation in the Internet space.

Lenard’s comments are available on the TPI website.

The Technology Policy Institute

The Technology Policy Institute is a non-profit research and educational organization that focuses on the economics of innovation, technological change, and related regulation in the United States and around the world. More information is available at https://techpolicyinstitute.org/.

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