Editor's note: The following is the latest in a new series of articles on AlterNet called Fear in America that launched this March. Read the introduction to the series.

The Internet and our digital media are quietly becoming a pervasive and manipulative interactive surveillance system. Leading U.S. online companies, while claiming to be strong supporters of an open and democratic Internet, are working behind the scenes to ensure that they have unlimited and unchecked power to “shadow” each of us online. They have allied with global advertisers to transform the Internet into a medium whose true ambition is to track, influence and sell, in a never-ending cycle, their products and political ideas. While Google, Facebook and other digital giants claim to strongly support a “democratic” Internet, their real goal is to use all the “screens” we use to empower a highly commercialized and corporatized digital media culture.

Last Thursday was widely viewed as a victory for “Internet Freedom” and a blow to a “corporatized” Internet as the Federal Communications Commission (FCC) endorsed a historic public utility framework for Network Neutrality (NN). It took the intervention of President Obama last year, who called for “the strongest possible rules to protect net neutrality,” to dramatically transform the FCC’s plans. Its chairman, Thomas Wheeler, a former cable and telecom lobbyist, had previously been ambivalent about endorsing strong utility-like regulations. But feeling the pressure, especially from the president, he became a “born again” NN champion, leading the agency to endorse “strong, sustainable rules to protect the Open Internet.”

But the next day, the Obama White House took another approach to Internet Freedom, handing the leading online companies, including Google, Facebook, and their Fortune-type advertising clients, a major political victory. The administration released its long-awaited “Consumer Privacy Bill of Rights” legislation. The bill enables the most powerful corporations and their trade associations to greatly determine what American privacy rights will be. By giving further control over how data are gathered and used online, the administration basically ceded more clout to a corporate elite that will be able to effectively decide how the Internet and digital applications operate, today and in the near future.

How do privacy rules impact the openness of the Internet, and the ability to promote and sustain progressive and alternative perspectives? While much of the public debate on pervasive data mining has focused on the role of the NSA and other intelligence agencies that were exposed by Edward Snowden, there has not been as much discussion on the impact of the commercial data system that is at the core of the Internet today. Google, Facebook, and others use our data as the basis of an ever-expanding global system of commercial surveillance. This information is gathered from our mobile devices, PCs, apps, social networks, and increasingly even TVs—and stored in digital profiles. These far-reaching dossiers—which can be accessed and updated in milliseconds—can include information on our race/ethnicity, financial status, health concerns, location, online behavior, what our children do, whom we communicate with on social media, and much more.

The major online companies are continually expanding their commercial data gathering practices. They now merge and use our online and offline data (what we do online and information collected from store loyalty cards, etc.); track us across all the devices we use (PCs, mobile, etc.); and amass even more data about us supplied by a vast network of data broker alliances and partnerships (such as Facebook with its myriad of data partners, including Acxiom and Epsilon). A U.S. digital data industry “arms race,” with companies vying to own the most complete set of records on every consumer, has also led to a wave of mergers and acquisitions, where companies that have already compiled huge datasets on Americans (and global consumers) being swallowed up by even larger ones.

Leading corporations are investing vast sums to harvest and, in their own words, make “actionable” information we now generate nearly 24/7. So-called “Big Data” technologies enable companies to quickly analyze and take advantage of all this information, including understanding how each of us uses online media and mobile phones. A score of “Math Men and Women”-led advertising-technology companies have pioneered the use of super fast computers that track where we are online and, in milliseconds, crunch through lots of our data to decide whether to target us with advertising and marketing (regardless of whether we use a PC or mobile device and, increasingly, using our geolocation information).

These machines are used to “auction” us off individually to the highest bidder, so we can be instantly delivered some form of marketing (or even political) message. Increasingly, the largest brands and ad agencies are using all this data and new tactics to sell us junk food, insurance, cars, and political candidates. For example, these anonymous machines can determine whether to offer us a high-interest pay day loan or a lower interest credit card; or an ad from one political group versus another.

But it’s not just the ability to harvest data that’s the source of increased corporate clout on the Internet. Our profiles are tied to a system of micro-persuasion, the 21st century updating of traditional “Madison Avenue” advertising tactics that relied on “subliminal” and cultural influence. Today, online ads are constructed by connecting our information to a highly sophisticated digital marketing apparatus. At places like Google’s BrandLab, AT&T’s Adworks Lab, or through research efforts such as Facebook IQ, leading companies help their well-heeled clients take advantage of the latest insights from neuromarketing (to deliberately influence our emotions and subconscious), social media monitoring, new forms of corporate product placement, and the most effective ways to use all of our digital platforms.

The online marketing industry is helping determine the dimensions of our digital world. Much of the Internet and our mobile communications are being purposely developed as a highly commercialized marketplace, where the revenues that help fund content go to a select, and largely ad-supported, few. With Google, Facebook, major advertisers and agencies all working closely together throughout the world to further commercialize our relationship to digital media, and given their ownership over the leading search engines, social networks, online video channels, and how “monetization” of content operates, these forces pose a serious obstacle to a more democratic and diverse online environment.

One of the few barriers standing in the way of their digital dominance is the growing public concern about our commercial privacy. U.S. companies have largely bitterly opposed proposed privacy legislation—in the U.S. and also in the European Union (where data protection, as it is called, is considered a fundamental right). Effective regulations for privacy in the U.S. would restore our control of the information that has been collected about us, versus the system now in place that, for the most part, enables companies to freely use it. But under the proposed Obama plan, Google, Facebook and other data-gathering companies would be allowed to determine the rules. Through a scheme the White House calls a “multi-stakeholder” process, industry-dominated meetings—with consumer and privacy groups vastly outnumbered and out-resourced—would develop so-called self-regulatory “codes of conduct” to govern how the U.S. treats data collection and privacy. Codes would be developed to address, for example, how companies can track and use our location information; how they compile dossiers about us based on what we do at the local grocery store and read online; how health data can be collected and used from devices like Fitbit; and more. This process is designed to protect the bottom line of the data companies, which the Obama White House views as important to the economy and job growth. (Stealing other people’s data, in other words, is one of America’s most successful industries). Like similar self-regulatory efforts, stakeholder codes are really designed to sanction existing business practices and enable companies to continue to accumulate and use vast data assets unencumbered. The administration claims that such a stakeholder process can operate more effectively than legislation, operating quickly in “Internet time.” Dominated by industry as they are, stakeholder bodies are incapable of doing anything that would adversely impact their own future—which currently depends on the ability to gather and use all our data.

The administration’s bill also strips away the power of the Federal Trade Commission (FTC), which now acts as the leading federal watchdog on privacy. Instead of empowering the FTC to develop national rules that enable individuals to make their own privacy decisions, the bill forces the agency to quickly review (in as little as 90 days) the proposed stakeholder codes—with little effective power to reject them. Companies become largely immune to FTC oversight and enforcement when they agree to abide by the self-regulatory policies their lobbyists basically wrote. In a rare rebuke to the administration, the FTC, leading Congressional Democrats, and the majority of consumer and privacy organizations rejected the White House’s privacy plan. But the administration does not appear to be willing, for now, to change its support for the data companies; and as we know, Silicon Valley and their business allies have strong support in Congress that will prevent any privacy law from passing for now.

To see how the online lobby has different views on Internet Freedom, compare, for example the statements of the “Internet Association”—the lobbying trade organization that represents Google, Facebook, Amazon and dozens of other major online data-gathering companies—on last week’s two developments. It praised the FCC NN decision for creating “strong, enforceable net neutrality rules … banning paid prioritization, blocking, and discrimination online.” But the group rejected the Administration’s privacy proposal, as weak as it was, explaining that “today’s wide-ranging legislative proposal outlined by the Commerce Department casts a needlessly imprecise net.” At stake, as the Internet Association knows, is the ability of its members to expand their businesses throughout the world unencumbered. For example, high on the agenda for the Internet Association members are new U.S. brokered global trade deals, such as the Transatlantic Trade and Investment Partnership, which will free our digital giants from having to worry about strong privacy laws abroad.

While the NN battle correctly viewed Comcast, Verizon, and other cable and phone giants as major opponents to a more democratic digital media environment, many of the online companies were seen as supporters and allies. But an “open” network free from control of our cable/telco monopolies is just one essential part for a more diverse and public interest-minded online system. Freedom must also prevent powerful interests from determining the very structure of communications in the digital age. Those companies that can collect and most effectively use our information are also gatekeepers and shapers of our Internet Future.

The NN victory is only one key step for a public-interest agenda for digital media. We also must place limits on today’s digital media conglomerates, especially their ability to use all our data. The U.S is one of the only “developed” countries that still doesn’t have a national law protecting our privacy. For those concerned about the environment, we must also address how U.S. companies are using the Internet to encourage the global public to engage in a never-ending consumption spree that has consequences for sustainability and a more equitable future.

There is ultimately an alignment of interests between the so-called “old” media of cable and the telephone industry with the “new” online media. They share similar values when it comes to ensuring the media they control brings eyeballs and our bank accounts to serve them and their advertising clients. While progressive and public interest voices today find the Internet accessible for organizing and promoting alternative views, to keep it so will require much more work.