FTC study on the six largest ISPs finds that some fail to fully inform consumers on how their data is monetized, such as using browsing history to serve up ads
Internet service providers fail to disclose to consumers how they use sensitive data, obscure privacy practices and making … Source: Federal Trade Commission .
CyberScoopTonya Riley
Context & Ripple Effects
This report closes out a probe the FTC began in March 2019, when it ordered seven ISPs — including AT&T and Verizon — to hand over nonpublic information about how they handle consumer data. The findings now published show that some of the six largest providers still fail to fully disclose monetization practices like serving ads off browsing history.
The disclosure gap sits in a regulatory vacuum: telecom operators had already lobbied to stall dozens of state-level bills that would have barred ISPs from selling customer data, so the FTC's study is effectively the main accountability mechanism left standing.
First-order effects
AT&T, Verizon and the other ISPs covered by the 2019 FTC inquiry now face documented evidence that their privacy disclosures obscure how browsing data becomes ad inventory, giving the commission a factual basis for follow-on action.
The FTC states that any business using personalized pricing must disclose it and says it may deploy enforcement resources or lawsuits against firms that don't — a direct threat aimed at ISPs whose reports were opaque.
Second-order effects
ISPs' advertising arms must compete with web platforms under a disclosure standard the carriers themselves helped avoid at the state level, eroding the asymmetry created by the stalled state-privacy legislation.
Opaque practices that once drew little scrutiny become audit targets, raising compliance costs for carrier data operations just as the FCC reporting episode showed regulators already distrust ISP self-reporting.
Third-order effects
The FTC's playbook here — order nonpublic data, publish gaps, signal enforcement — is the same one it applied to Meta, YouTube and TikTok in its later 'vast surveillance' report, suggesting disclosure of data monetization is becoming a de facto federal baseline in lieu of passed privacy legislation.
The trend: Regulators are substituting FTC disclosure studies for stalled legislative privacy rules, moving from ISPs to social platforms as the subjects.
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