Gus Rossi
Principal, Beneficial Technology

Stronger Privacy Rules in California Can Benefit Everyone

September 30, 2019

Last week, the group behind the groundbreaking California Consumer Privacy Act (CCPA), Californians for Consumer Privacy, proposed a new initiative for the state’s November 2020 ballot. The California Privacy Rights and Enforcement Act (CPREA) can strengthen CCPA in several critical ways:

  • If it passes, companies will be required to demonstrate opt-in consent if they want to collect children’s personal information.
  • Companies that use personal data to influence elections will also need to disclose this to both to consumers and state authorities.
  • The initiative targets discrimination and profiling by mandating greater transparency for automated decision-making as well.
  • And notably, it will create a new and independent California Privacy Protection Agency, with subpoena powers, to implement, monitor, and enforce the new law.

We welcome CPREA to the platform regulation debate. The United States is the only advanced nation without a comprehensive privacy framework. Because of the United States insufficient patchwork of protections, many in the tech economy have a business model that exploits people’s data, violating their privacy and compromising their dignity. Without clear laws that mandate restrictions on consumer data usage and collection, we will continue to have a skewed data economy that rewards a few powerful platforms for their surveillance capitalism models.

California lawmakers passed the CCPA more than a year ago, triggering a much-needed debate at the federal level about the importance of protecting people’s privacy from the dystopian powers of some tech platforms. American’s creative, entrepreneurial energy must be channeled into innovative business models that put the consumer value and trust first. And investors and entrepreneurs have to be supported by forward-looking regulation that incentivizes and rewards good behavior, like leading with security and privacy.

Tech giants are rightly afraid that CCPA will limit their surveillance power, and they have been responding in force. Their lobbyists are actively trying to stop a federal version of CCPA and preempting other states from following California’s lead. In Sacramento, the lobbyists are doing everything they can to delay CCPA’s implementation and water it down as much as possible. Not surprisingly, lobbyists from the largest tech firms vastly outnumber public interest advocates who are doing their best to hold the line for consumers.

If we are to have a fair, leading-edge, and sustainable data economy that works for everyone, we needs guardrails in form of clear rules and regulations that balance innovation and competitiveness with consumer protection and respect for our democratic institutions. Privacy frameworks such as CCPA, CPREA and Europe’s General Data Protection Regulation are central to this equation. Consumers should have much greater agency and recourse with regard to what happens with their data. And companies need clear rules and limits in how they can collect, use, and treat such data.

Essential as this is, a privacy law is no magic bullet that will fix the many problems that exist in the tech economy. That is why, at Omidyar Network, we support and promote a diversified toolbox of potential solutions, including privacy, antitrust, and competition policy; the overhaul of corporate governance rules; and reimagining content standards and policies.

We are also actively collaborating with other tech investors, who see the business opportunity in bold companies that build privacy-enhancing solutions, and want their capital to be a force for good. We commend the investors and entrepreneurs who recognize the business case for innovating with and challenging existing, harmful business models. They have created value propositions based on trustworthiness and security ahead of regulatory pressure.

Technology can be a tremendous force for good when properly stewarded. When it works in service of people, technology can accelerate inclusion, expand access to services, and stimulate innovation that improves lives.

So, while we welcome this new proposed ballot initiative in California, we also urge Congress, the California legislature, and legislative bodies across the country and the globe to do everything in their power to protect consumers.


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