2013 09 12 NYT Facebook Privacy Change Is Subject of F.T.C. Inquiry – NYTimes.com
Facebook Privacy Change Is Subject of F.T.C. Inquiry
Facebook, which has repeatedly tripped over its own feet when changing its privacy practices, has stumbled yet again.
The Federal Trade Commission said on Wednesday that it had begun an inquiry into whether the social network’s proposed new privacy policies, unveiled two weeks ago, violated a 2011 agreement with regulators. Under that agreement, the social network is required to get the explicit consent of its users before exposing their private information to new audiences.
Facebook’s new policies make clear that users are required to grant the company wide permission to use their personal information in advertising as a condition of using the service.
Facebook says the language was in part required by a federal court. In August, a judge approved some of the wording as part of a settlement in a class-action suit brought by users upset at seeing their names and photos used to endorse products in Facebook ads sent to their friends.
Peter Kaplan, a spokesman for the F.T.C., said on Wednesday that Facebook was subject to continuing oversight by the commission because of the consent order.
“Facebook never sought out a discussion with us beforehand about these proposed changes,” he said. “We’re monitoring compliance with the order. Part of that involves interacting with Facebook.”
Facebook informed the F.T.C. of the new language just before it was posted to its Web site. It said its new policies complied with the 2011 F.T.C. order as well as the separate 2013 class-action settlement.
“We routinely discuss policy updates with the F.T.C., and this time is no different,” Jodi Seth, a Facebook spokeswoman, said in a statement. “Our updated policies do not grant Facebook any additional rights to use consumer information in advertising. Rather, the new policies further clarify and explain our existing practices. ”
On Wednesday, Senator Edward J. Markey, Democrat of Massachusetts, stepped up pressure on the F.T.C., sending a letter to the agency raising concerns about the new policies and asking for an investigation.
The company insists that despite the wording changes, the new policies do not change the rights its users have over personal data.
When it comes to advertising, Facebook has long maintained that it can freely use a person’s name, photo, comments and other information in advertising as long as it shows the ad only to people who already have rights to see the underlying information. For example, if you compliment Starbucks’ pumpkin spice latte in a post that can theoretically be viewed by your Facebook friends, the coffee company can pay Facebook to broadcast that comment to all of your friends to improve the chances that they see it.
That kind of advertising, known as a sponsored story, is valuable to advertisers because it looks like a product endorsement from a trusted friend rather than a traditional ad. Facebook’s privacy controversies extend to its early days. In 2007, for example, Facebook began a service called Beacon that automatically broadcast a person’s purchases on other sites to their Facebook friends. The 2011 settlement with the F.T.C. came after the company decided on its own to make certain private information on its users more public.
Some users object to being pitchmen for products, and such concerns led to the recent class-action settlement. As part of that agreement, Facebook is supposed to allow users to see exactly which sponsored stories they’ve been used in and give them some control over how their names and photos are used in future pitches.
Facebook’s new policies were posted on the company’s Web site on Aug. 29 and sent to most users just before the Labor Day holiday weekend, with the company stating they would be put in force on Sept. 5.
After a storm of negative comments from users and a letter of complaint to the F.T.C. by privacy advocates, the company delayed adoption of the policy.
Privacy advocates were especially troubled by a provision that states Facebook automatically assumes that the parents of teenagers using the service have given permission for their names and images to be used in Facebook advertising. The company says it applies similar protections for teenagers as it does for adults.
Privacy advocates also say Facebook is being disingenuous in its description of the new policies. They say the language would essentially give the company blanket permission to use the name, photo and other personal content of its users in advertising or sponsored content.
“Clearly, the proposed Facebook changes raise troubling concerns,” said Marc Rotenberg, president of the Electronic Privacy Information Center, one of the privacy groups that wrote to the F.T.C. last week. “The Federal Trade Commission needs to act.”