UPDATE 3/2/17: The FCC today, under new Chairman Ajit Pai, said it will stay the ISP customer privacy rules approved in October and set to go into effect today.
"We still believe that jurisdiction over broadband providers' privacy and data security practices should be returned to the FTC, the nation's expert agency with respect to these important subjects. All actors in the online space should be subject to the same rules, enforced by the same agency," Pai said in a joint statement with Acting FTC Chairman Maureen K. Ohlhausen.
Pai said the two agencies "will work together on harmonizing the FCC's privacy rules for broadband providers with the FTC's standards for other companies in the digital economy.
"This rule is not consistent with the FTC's privacy framework," Pai said. "It does not serve consumers' interests to create two distinct frameworks—one for Internet service providers and one for all other online companies."
He shot down the idea that his move will make internet users unsafe since the rules were "not yet in effect."
The Electronic Frontier Foundation, however, says the move simply "granted the telecom industry its wish."
UPDATE 10/27: In a 3-2 vote, the FCC on Oct. 27 approved new privacy rules regarding how ISPs use your data. Read on for more details below.
Original story 10/6:
FCC Chairman Tom Wheeler today formally circulated a proposal intended to give Internet users more control over how ISPs use their personal information.
ISPs are "collecting information about us every time we go online," Wheeler said in a blog post. "The problem is, there are currently no rules in place outlining how ISPs may use and share their customers' personal information."
Wheeler first floated a plan for stricter oversight of ISP customer data in March, and today's proposal takes into account the public comments the agency has received on the subject since then.
"Based on the extensive feedback we've received, I am proposing new rules to provide consumers increased choice, transparency and security online. I have shared this proposal with my colleagues and the full Commission will consider these proposed privacy rules at our upcoming monthly meeting on October 27," Wheeler said.
The rules would put data into several privacy tiers. For sensitive data—like Social Security numbers, geolocation, health information, Web browsing history, and content of communications—ISPs would have to obtain opt-in consent to use and share that data.
The sharing of less-sensitive information, like what service tier you have in order to market additional products, would be opt out.
Anonymized data, which can no longer be linked to a specific customer, can be shared without consent, though ISPs need to make sure it's actually anonymized, the FCC says.
Overall, however, ISPs must inform customers what types of data is collected about them; how they use that data; and the entities with which ISPs share it. That info must be accessible on an ISP's website or app. ISPs cannot ban consumers if they refuse to allow the sharing of their data.
"To be clear, this proposal focuses on information collected from consumers when they use broadband services, such as residential or mobile connections. It would not apply to the privacy practices of websites or apps, over which the Federal Trade Commission has authority," Wheeler said. "And that is true even when a website or app is owned by a broadband provider. It's also important to note that the proposed rules would not prohibit ISPs from using or sharing their customers' information – they would simply require ISPs to put their customers in the driver's seat when it comes to those decisions."
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The Internet & Television Association, which represents major ISPs, said the proposal "departs from the FTC's proven sensitivity-based approach to consumer privacy in several key respects. Specifically, in its treatment of Web browsing data and first party marketing of ISP services, the FCC departs from past FTC practice in ways that violate principles of fair competition and deny consumers the benefit of a consistent approach to online privacy protection.
"If the Chairman insists on advancing this approach, we would hope that his fellow commissioners would 'opt-out' and seek a result more faithful to the FTC's proven framework of protecting consumers," the association concluded.
In a statement, consumer group Public Knowledge called the rules a "much-needed upgrade for our broadband access privacy."