On November 4, California passed Proposition 24, also known as the California Privacy Rights Act. The law will expand the California Consumer Protection Act (CCPA), which took effect in January. California, which was already a leader in online privacy, will now feature some of the world’s tightest data security regulations.
Unlike Europe with the General Data Protection Regulation (GDPR), the U.S. has taken relatively few steps to regulate online privacy protection. California has been a notable exception, leading the way by passing the CCPA in 2018. With the passing of Proposition 24, the state has reaffirmed its position as a leader in security regulations.
What Is Proposition 24?
Under the CCPA, Californians could ask companies to disclose and delete any personal data they had acquired on them. Prop 24 extends this user power, enabling people to request that companies not share this data. If users request, businesses can’t share or sell information like race, health, location, biometrics, or sexual orientation.
Under Prop 24, companies could face fines up to $7,500 for violating minors’ privacy rights. The law also makes it harder to weaken these restrictions in the future. To enforce these regulations, Prop 24 will create a Privacy Protection Agency, taking the responsibility away from the attorney general.
A movement to let users automatically opt-out of data collection will likely follow California’s Proposition 24. While many people expect that outcome, it’s not certain. Apart from this hypothetical addition, the law will take effect in 2023.
What Prop 24 Could Mean for Businesses and Consumers
California’s Proposition 24 could bring some needed protections to internet users. Before this law, companies could largely share and sell personal data without users’ knowledge. Having the option to opt out of data sharing transfers power over sensitive information back into consumers’ hands.
While increased privacy is certainly a good thing, Prop 24 still faced considerable opposition. Opponents like the American Civil Liberties Union (ACLU) argue it could lead to a paywall for privacy. Companies could charge users who opted out of data sharing more, effectively making consumers pay to protect their information.
Websites like Facebook and Google could face considerable losses, as much of their revenue comes from user data-based advertising. Other companies may have to adjust as well but may not feel the effects to the same degree.
With Prop 24 placing new emphasis on privacy, California businesses may have to readdress their data security. California law requires companies to gather data like race, gender and ethnicity for reporting. They may now be under more pressure to keep that information as private as possible.
Changing Data Privacy Landscapes in California and Beyond
The long-term effects of California’s Proposition 24 will likely extend far beyond the state’s borders. After California passed the CCPA, other states followed suit, issuing similar data protection regulations. A similar phenomenon could happen now that Prop 24 has passed.
As data protection becomes a more prevalent concern, the U.S. could even see federal regulations before long. If Prop 24 is a success or inspires other politicians enough, the federal government could enact similar policies nationwide. All U.S.-based businesses would have to adjust to these regulations, and more users could experience improved privacy.
Of course, the same concerns over Prop 24 data privacy would linger over policies at a national level. If it creates a privacy paywall, it could harm hundreds of millions of Americans. Whether or not that will happen, though, is still just a matter of speculation.
Digital Privacy Is a Growing Concern
Governments at every level can no longer ignore issues of data privacy. As user data play more central roles in daily life, regulating it will become increasingly urgent. California’s Proposition 24 signals the start of a new age in data regulation, for better or worse.
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Shannon Flynn is a tech writer and Managing Editor for ReHack.com. She covers topics in biztech, IoT, and entertainment. Visit ReHack.com or follow ReHack on Twitter or to see more of Shannon’s posts.