Apple Inc (NASDAQ:AAPL) and Microsoft Corporation (NASDAQ:MSFT) are among several tech companies that have posted some objections to new proposed regulations by the Federal Trade Commission, which were reportedly designed to strengthen online privacy and security for children who browse the Internet.
The arguments by Apple Inc (NASDAQ:AAPL) and Microsoft Corporation (NASDAQ:MSFT) aren’t so much anti-child, but instead they are arguing that the regulations are so prohibitive and constraining that they actually may leave children more at risk. Is is reported that Google Inc (NASDAQ:GOOG), Facebook Inc (NASDAQ:FB) and Twitter are also among those companies who have expressed their concerns about the regulations, as well, saying that these regulations may actually deter production of child-friendly services and Web sites.
“If adopted, the effect of these new rules would be to slow the deployment of applications that provide tremendous benefits to children, and to slow the economic growth and job creation generated by the app economy,” wrote Catherine Novelli of Apple Inc (NASDAQ:AAPL) in comments to the FTC.
But is this really about children’s privacy, or it is about the data mining and data collection that has been so pervasive on the Internet to enhance the marketing opportunities for advertisers with companies like Apple Inc (NASDAQ:AAPL), Google Inc (NASDAQ:GOOG) or Microsoft Corporation (NASDAQ:MSFT)? That issue is also debatable, not to mention the regulations themselves. “What children post online or search as part of their homework should not haunt them as they apply to colleges or for jobs,” said Rep. Ed Markey (D-Mass.), co-chair of the Bipartisan Congressional Privacy Caucus. “YouTube should not be turned into YouTracked.”
“What is the harm we are trying to prevent here?” asked Alan Friel of law firm Edwards Wildman Palmer. “We risk losing a lot of the really good educational and entertaining content if we make things too difficult for people to operate the sites or generate revenue from the sites.”
In lieu of the federal elections Tuesday, it is difficult to think that the FTC will actually take any action on these regulations in the short-term, which for now means that Apple Inc (NASDAQ:AAPL) and Microsoft Corporation (NASDAQ:MSFT) may be out of the woods in terms of having to adjust to be in compliance to these more stringent rules. After reading the story linked above, what do you think? Would this regulation dramatically affect these companies, and how do you think investors in Apple Inc (NASDAQ:AAPL) and Microsoft Corporation (NASDAQ:MSFT) – like billionaire fund managers David Einhorn of Greenlight Capital and Seth Klarman of Baupost Group – would see these regulations and how they might affect the marketplace? Let us know your thoughts!