Internet for Growth Warns Federal Data Privacy Bill Could Have Unintended Consequences for Small Businesses and Consumers
Washington, D.C. – Internet for Growth, a nationwide coalition of small businesses advocating for digital advertising, is praising a new attempt to create a national data privacy law that would simplify a complex patchwork of state laws emerging across the country. However, the group, organizing meetings with members of Congress during National Small Business Week in May, is concerned other provisions in a discussion draft of the American Privacy Rights Act, which Senator Maria Cantwell (D-WA) and Representative Cathy McMorris Rodgers (R-WA) introduced last week, could have unintended consequences for innovation, jobs, and the economy.
“Data privacy is important. So is protecting digital advertising helping small businesses to communicate with customers,” said Internet for Growth Executive Director Brendan Thomas. “Digital advertising supports online publishers and content creators. Entertainment, news, email, navigation, even many business applications, are free because of digital advertising. If there’s not more balance, bills like this one could affect everyone’s online experience. Meant to protect consumers, it could make the internet a much less consumer-friendly place.”
Thomas explained that, while the bill exempts small businesses from the heaviest regulations and penalties, including a likely flood of civil lawsuits under a “private right of action,” punitive aspects of the bill, as well as prohibitions on common consumer data, could affect the entire ad-supported internet. Whether the American Privacy Rights Act would truly preempt a complex patchwork of state laws is unclear.
“Internet for Growth appreciates Congress’ work to create a national privacy law. However, our members depend on social media, search, and streaming platforms that could become less affordable and effective with less data,” he said. “Many are website publishers who could lose the ability to understand their audiences and earn income. With inflation rising again, this could be the worst possible time to increase the cost of digital advertising, which has leveled the playing field for small businesses competing with big brand-name companies. The bill could even reward those same companies with more resources.”
To raise awareness of the value of digital advertising to small businesses and their customers, Internet for Growth has organized over 70 meetings with members of Congress, including sponsors of the American Privacy Right Act, formerly known as the American Data Privacy and Protection Act. The group has sent over 20,000 letters to federal elected officials and has urged the Federal Trade Commission to protect digital advertising from rules and regulations for “commercial surveillance.”
Congress is also reviving the Banning Surveillance Advertising Act that would eliminate personalized advertising. “What many of these proposals have in common is an under-appreciation of the important role digital advertising plays in our economy and society,” said Thomas. “We’re working to increase understanding and prevent damage to a critical resource for small businesses, their customers, and every internet user.”
Internet for Growth, an initiative of the Interactive Advertising Bureau, promotes the transformative role the advertising-supported internet plays in empowering America’s small businesses, helping entrepreneurs bring their ideas to life. Supported by a diverse community of over 700 IAB members including marketers, agencies, publishers, platforms, and ad tech providers, as well as hundreds of small businesses and creators, we highlight the benefits digital advertising delivers to local economies, expanding opportunities for innovators to reach markets far beyond their neighborhoods. Our work ensures people understand the limitless opportunity the internet provides for creativity and commerce, fair competition, and connecting with consumers on mutually shared values and interests, no matter their background or geography.