World Patent Marketing News Blog

October 31, 2016

In Insider

Invention Marketing Faces Big Changes Due To Privacy Advocates Victory At FCC

The FCC dropped a bombshell on the internet marketing community last Thursday. The FCC (Federal Communications Commission) released new internet privacy rules, intended to dramatically change internet marketing.

Marketing inventions online may be easier for small business with new internet privacy rules.

The surprise ruling restricts internet companies from gathering and selling data regarding the location and web browsing histories of their customers, unless the customers explicitly opt-in.  The new rules could have important implications for inventors who plan to market their invention ideas online.

Internet marketers are in an uproar over the ruling, with the head of the Direct Marketing Association declaring, "The FCC got this wrong." 

"Some of the big internet companies are howling," said Scott Cooper, CEO and Creative Director of World Patent Marketing. "The prices for the recent mergers of AT&T and Verizon with huge media conglomerates was based on that data capture. They were relying on this hyper-targeted advertising model to generate ad revenue. 

New invention ideas were held back with 24/7 targeted marketing.

"The problem with that was obvious, it completely tossed the idea of customer privacy in the garbage. If the FCC had let this practice continue, it would have been almost impossible to claw back. The big corporations would have had a 24/7 surveillance net and a complete dossier on every internet user. To me, that is too much. I believe in the power of online invention marketing, but we don't sell customer data here at World Patent Marketing. We believe in privacy. 

"I know the ruling just came out, we have to see how it is applied in the courts to see what its real impact will be. But, for the time being, I think it was the right thing to do. Customer privacy is too important to let corporate greed take it away." 

Controversial Internet Privacy Rule Will Affect Invention Patents and Marketing

Some of the largest tech and media firms are dramatically affected by this ruling. The recent merger of Verizon, AOL and Yahoo, as well as AT&T and Time Warner, were predicated on the power of massive all encompassing consumer data bases. The intention was to gather, compile, and offer the information for sale to advertisers.

Internet privacy is vital to the creation of new invention ideas.

The internet data capture industry euphemistically refers to this as "data sharing" but it is nothing more than the sale for profit of information gathered on customers and internet users without their knowledge or consent. The FCC ruling does not prohibit the data industry from gathering this information, they simply require companies to inform customer and get their' consent. 

Privacy advocates regarded the matter as urgent, because the growth of technology had increased the power of tracking customers to an unprecedented level. The good old days of magazines, newspapers and mail order catalogs selling their subscriber lists had morphed into another animal altogether with the coming of age of mobile devices and the internet. 

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These devices offered big business the ability to track the location of each customer in real time. A powerful tool in and of itself. But, when combined with internet databases which could track and store every click, page visit, and online purchase, as well as friends, family, professional networks and political activity, the power of these devices and software grew exponentially.

Privacy advocates warned of a Panopticon effect ( an 18th century prison built in the round, in which prisoners were under 24 hour surveillance), in which consumers would lose all expectation of privacy. In addition, the assymetrical nature of the relationship between the consumer and big business invited negative practices, such as unfair pricing and fiat scarcity.

It could be that the FCC's new internet privacy rules will actually help level the playing field for small inventors and entrepreneurs. With how much it costs to patent an idea, startup companies are rarely able to afford big data. The new FCC internet privacy rules may allow new invention ideas to compete head to head to head in the market place on merit, rather than by gaming the system.  

Privacy Advocates Vs. Internet Mega-Corps

The privacy community is delighted with the ruling, referring to it as an early Christmas present.

Corporate surveillance is bad for the creation of new invention ideas and invention marketing.

The online marketing community is ballistic. Advertising Age reports that, Emmett O'Keefe, senior VP of Advocacy for the DMA said, "Today the FCC took an action which discards the regulatory framework that has fostered the growth of the internet economy and supports much of the content and services consumers enjoy every day. The FCC's decision is bad for consumers and bad for the U.S. economy. There are no winners in this action; only losers. In short, the FCC got this wrong."

And, The Internet & Television Association wrote that, "The [FCC]'s decision to break with the FTC's proven privacy framework in favor of a cobbled-together approach that abandons principles of fair competition is profoundly disappointing. Instead of creating a consistent and uniform approach to privacy that consumers can easily understand, today's result speaks more to regulatory opportunism than reasoned policy."

But the most hyperbolic remarks came from The Association of National Advertisers who said, "FCC's new sweeping privacy rules decision, [are] unprecedented, misguided, counterproductive, and potentially extremely harmful."

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All of this seems excessive, given that email addresses can still be scraped, service tiers are still fair game. It is just the full-spectrum nature of the information gathering that has been halted. It should also be noted that the ruling brings U.S. internet marketers into closer conformance with European privacy rules as well as our own national rules for direct mail, direct TV, and physical retailers. The freedom the internet marketers have enjoyed, because of the claims that their new and successful technology is so different, has been an aberration in the matter of privacy and consumer protections.

The internet data marketing industry had hoped that the FCC would follow the lead of the FTC (Federal Trade Commission) in their new rules, which have limited prohibitions and require an opt-in for data gathered on minors. But the FTC can only make recommendations which are not enforceable. Instead, the FCC grabbed the octopus by its tentacles and gave it a big shake. 

The dust hasn't settled yet, but it looks like Round One has gone to Privacy Advocates.

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