Connect with us

Business

FTC Fines Facebook $5 Billion for Privacy Violations

Published

1 year ago

on

  • The Federal Trade Commission has fined Facebook $5 billion for violating the privacy of customers and imposed new accountability measures and restrictions for Facebook, WhatsApp, and Instagram.
  • The fine is the largest penalty imposed on a tech company for privacy violations ever, which comes after a yearlong investigation into Facebook’s involvement in the Cambridge Analytica data breach.
  • The FTC found that Facebook “deceived” their customers by allowing their data to be accessed by apps their friends used, despite telling the public they had stopped that practice.
  • The FTC also alleges that Facebook enforced data sharing policies based “on whether Facebook benefited financially from its arrangements with the developer.”

FTC Announcement 

The U.S. Federal Trade Commission (FTC) announced Wednesday that it was fining Facebook a record-breaking $5 billion for privacy violations as well as instituting sweeping privacy restrictions and oversight measures.

The penalty represents the largest fine that the FTC has ever imposed on a tech company by far. It is also the biggest penalty ever brought on a company for privacy violations, according to the FTC announcement.

The announcement comes after a yearlong investigation of Facebook over privacy violations.

That investigation was started right after The New York Times and The Observer of London reported that Facebook allowed British political consulting firm Cambridge Analytica to harvest the data of millions of Facebook users without their knowledge and build voter profiles from those users data without their consent.

Cambridge Analytica got the data from Facebook users who used a third-party gaming application called “This Is Your Digital Life.”

Although it has been estimated that only around 270,000 people used the app, the users who gave the app permission to access and acquire their data also gave the app permission to do the same for all of their Facebook friends.

That resulted in the personal information of nearly 87 million Facebook users being collected by Cambridge Analytica, despite the fact that the vast majority of those people had never given the firm permission to access their information, or even played the game.

Along with investigating Cambridge Analytica, the FTC’s investigation also expanded to look at other privacy concerns, such as the tech giant’s data-sharing policies with other third-party apps and device-makers that Facebook users might not have understood or been aware of.

FTC Findings

All of that culminated in the report and announcement released Wednesday by the FTC.

In addition to the $5 billion fine, the FTC’s announcement also stated that Facebook must “submit to new restrictions and a modified corporate structure that will hold the company accountable for the decisions it makes about its users’ privacy.”

That requirement, the FTC says, is mandated “to settle Federal Trade Commission charges that the company violated a 2012 FTC order by deceiving users about their ability to control the privacy of their personal information.”

The FTC goes on to describe the 2012 order in question, saying that it explicitly “prohibited Facebook from making misrepresentations about the privacy or security of consumers’ personal information, and the extent to which it shares personal information.” 

The 2012 FTC order also required that Facebook “maintain a reasonable privacy program that safeguards the privacy and confidentiality of user information.”

Violations of 2012 Order

The FTC goes on to outline how Facebook specifically violated the 2012 order. The statement describes numerous instances, but the most significant examples center around privacy disclosures to customers.

For example, in 2012, Facebook put a disclosure on their Privacy Settings page telling users the information they shared with their friends could also be shared with the third-party apps their friends used. 

The FTC claims that four months later, Facebook removed the disclosure “even though it was still sharing data from an app user’s Facebook friends with third-party developers.”

Then in 2014, Facebook announced they would stop letting third-party developers collect data about the friends of app users. However, the FTC says that Facebook separately told the developers that they could continue to access that data until April 2015.

Even then, Facebook still waited “until at least June 2018 to stop sharing user information with third-party apps used by their Facebook friends,” the FTC said.

The statement then goes on to say, “Facebook did not screen the developers or their apps before granting them access to vast amounts of user data.” 

Facebook also claimed it had consequences for policy violations by third-parties, but it “did not enforce such policies consistently and often based enforcement of its policies on whether Facebook benefited financially from its arrangements with the developer,” the FTC alleged.

New Restrictions & Overhauls

In addition to spelling out Facebook’s privacy violations, the FTC announcement also included some of the new restrictions and oversight measures that Facebook will have to comply with under the settlement.

To ensure accountability with Facebook’s board of directors, the order will create “an independent privacy committee of Facebook’s board of directors,” in order to remove “unfettered control by Facebook’s CEO Mark Zuckerberg over decisions affecting user privacy.”

The settlement also requires the company to “designate compliance officers who will be responsible for Facebook’s privacy program,” and gives a third-party assessor more power to evaluate Facebook’s privacy programs.

Regarding restrictions the settlement imposes, Facebook will now have to conduct privacy reviews for any new or modified products and services before they can be implemented.

It will also be required to document any data breach involving 500 or more users. 

The FTC statement continues to include a laundry list of new requirements, like exercising more oversight over third-party apps, encrypting passwords, and more.

Notably, it also requires Facebook to “establish, implement, and maintain a comprehensive data security program.”

Also of huge significance is that these new restrictions and accountability measures will also apply to Facebook-owned companies WhatsApp and Instagram.

Response

The decision was approved by the FTC’s commissioners in a 3-to-2 vote earlier this month, with the three Republican commissioners voting to approve the settlement and the two Democrat commissioners voting to oppose.

In a statement to The New York Times, the three Republican commissioners, including agency chairman, Joseph Simons, said the settlement “will provide significant deterrence not just to Facebook, but to every other company that collects or uses consumer data.”

However, the two Democratic commissioners argued that the settlement did not do enough. They said that the $5 billion fine is just a slap on the wrist for Facebook, which made $55.8 billion in revenues last year alone. 

They also pointed out that the settlement did not actually do anything to change or restrict Facebook’s ability to collect and share their user’s personal information.

“The proposed settlement does little to change the business model or practices that led to the recidivism,” Democratic Commissioner Rohit Chopra wrote in his dissenting statement. “Nor does it include any restrictions on the company’s mass surveillance or advertising tactics.”

The Democratic commissioners also reportedly disliked the settlement because they wanted to take the case to court, and felt that the Facebook executives should have been held personally accountable.

The Republican commissioners, however, have said that they did not have a strong enough case to move it to court. 

See what others are saying: (The Chicago Tribune) (The Washington Post) (The New York Times)

Related Topics:

Business

TikTok Bans Ads for Weight Loss Supplements and Fasting Apps

Published

3 days ago

on

September 24, 2020

By

  • TikTok said Wednesday that it will ban advertisements for fasting apps and weight loss supplements. It will also add new restrictions on ads that “promote a harmful and negative body image.”
  • Part of its new policies include only allowing viewers ages 18 and up to see ads for “weight management products” and barring ads with irresponsible claims. 
  • The app is also partnering with the National Eating Disorder Association to connect users with resources directly on the app and will support Weight Stigma Awareness Week (Sept. 28-Oct.2) with information about the topic on its discover page. 
  • The move comes after months of users noticing increased ads for Intermittent fasting apps and other weight-related products, which many found concerning considering TikTok’s massive young user base. 

New Restrictions Announced 

TikTok announced some new restrictions for weight loss advertisements on its platform Wednesday in an effort to support body positivity.

“We’re introducing new ad policies that ban ads for fasting apps and weight loss supplements, and increase restrictions on ads that promote a harmful or negative body image,” the company’s Safety Policy Manager, Tara Wadhwa, wrote in a blog post.

“These types of ads do not support the positive, inclusive, and safe experience we strive for on TikTok.”

Wadhwa said the app recognizes the role the internet plays in exacerbating weight stigma and body shaming and wants to do more to make TikTok a safe and comfortable environment for its users.

As far as what those new policies will be, TikTok said:

  • Advertisements for weight-management products can now only reach users ages 18 and up. 
  • Stronger restrictions will be placed on weight loss and implied weight-loss claims.
  • Further restrictions will be introduced to limit irresponsible claims made by products that promote weight loss management or control.
  • Ads promoting weight loss and weight management products or services cannot promote a negative body image or negative relationship with food.

Concerns for Young Users 

Those are some pretty important changes that address ads that have recently become common on the app. Over the last few months, TikTok users have complained about being served ads for products like intermitted fasting apps. That sparked a ton of concerns, especially since TikTok has such a young user base. 

According to internal company documents viewed by The New York Times, in July, TikTok classified more than a third of its 49 million daily users in the United States as being 14 years old or younger.

Other Efforts 

But that’s not all the app is doing to support inclusion and body positivity.

TikTok has also partnered with the National Eating Disorder Association (NEDA) to connect its users with resources directly on the app.

“We’ll soon begin redirecting searches and hashtags – for terms provided to us by NEDA, or associated with unsafe content we’ve removed from our platform – to the NEDA Helpline, where NEDA can then provide our community with confidential support, tools, and resources,” TikTok explained.

On top of that, the app is also supporting Weight Stigma Awareness Week, which runs from September 28-October 2.

During that time, it will have a dedicated page on it’s discover tab to support NEDA’s #EndWeightHateCampaign in an effort to educate the community about the topic, why it matters, and how users can find support for themselves or others.

In its announcement, TikTok also reminded users that they can always use its existing features to block content, users, and comments that they find disturbing, and report ads that violate its policies. 

While some would like to see TikTok do more to combat diet culture on its platform, the move has generally been met with praise, and it puts the app closer in line with policies platforms like Instagram have enacted.

Last year, Instagram started restricting users under the age of 18 from viewing ads promoting weight loss and cosmetic procedures. It also barred posts that make “miraculous” claims about weight loss while also including coupon codes or other commercial elements. Those changes were meant to target products people like the Kardashians and others promoted: flat tummy teas, appetite suppressant lollipops, and other items of that nature. 

Ultimately, it seems like TikTok is listening to its users by creating these new policies.

“Though there’s always more work we can do in this critical area, we think these are steps in the right direction,” it said in its blog post. “We continue to look for new ways to support our community and foster a positive environment for everyone on TikTok.”

See what others are saying: (Forbes) (CNBC) (Mashable) 

Continue Reading

Business

Charli D’Amelio’s Dunkin’ Partnership Proves Successful

Published

4 days ago

on

September 23, 2020

By

  • TikTok’s most-followed creator, Charli D’Amelio, partnered with the coffee chain Dunkin’ to add her go-to order to its menu for a limited time.  
  • A Dunkin’ official told TMZ that the chain sold hundreds of thousands of her signature drink, “The Charli,” within the first five days of launching. It also set a record for daily users on the Dunkin’ app the first day of the launch after seeing a 57% increase in app downloads. 
  • Dunkin’ even saw a 20% sales boost for all cold brews that day as well as a 45% surge the following day. 
  • This collaboration, along with musician Travis Scott’s partnership with McDonald’s, has many interested to see if and how more chains will use big names as marketing tools in the future. 

The Charli 

Officials at Dunkin’ have finally given some insight into just how powerful its partnership with 16-year-old Charli D’Amelio has been for the coffee chain. 

D’Amelio, of course, is TikTok’s most famous personality, and she recently teamed up with Dunkin’ to get her go-to coffee order on its menu for a limited time. The drink is called “The Charli,” a cold brew with whole milk and three pumps of caramel swirl.

It officially debuted in stores on Sept. 2. As part of the partnership, she also launched a contest with the chain. For that, the company invited her fans to post a picture on Instagram, recreating a memorable moment of Charli and her Dunkin’ drink using the hashtag #CharliXDunkinContest. Then, on Sept. 19, National Dance Day, five lucky winners were selected to join a virtual hang out with Charli. 

It was probably fair to assume that the drink would be a success given Charli’s massive following and influence these days. She’s currently sitting at 88.4 million followers on TikTok alone. and the drink has been spotted all over the app, with fans, friends, and influencers trying it out themselves.

However, Drayton Martin, vice president of brand stewardship at Dunkin’, just confirmed to TMZ that the chain sold hundreds of thousands of the signature drink within the first five days of launch. Dunkin’ also set a record for daily users on its app the day her drink debuted after seeing a 57% increase in app downloads. 

Apparently it wasn’t just “The Charli” that saw success. Dunkin’ also saw a 20% sales boost for all cold brews the first day as well as a 45% surge the next day. 

Travis Scott’s McDonald’s Deal 

These numbers are especially interesting to look at when acknowledging how lucrative Travis Scott’s limited edition collab with McDonald’s has proved to be. His partnership was for a $6 combo that included a Quarter Pounder with bacon and lettuce, fries, BBQ sauce, and a Sprite. 

That launched on Sept. 9, and he also sold some exclusive Mcdonald’s themed merch on his website at the time. 

Within days of the launch, several McDonald’s locations reported running out of ingredients to make the meals. In a memo sent to employees, McDonald’s said: “We’ve created a program that’s so compelling to our customers that it’s stretching our world-class supply chain; and if demand continues at these levels, more restaurants will break supply.”

Tons of people have been trying to get their hands on this meal. In fact, it even became a trend on TikTok to order it using a range of phrases. According to USA Today, McDonald’s even noted some of the various ways customers have been ordering the meal in their memo to employees. Some were part of marketing and social media materials for it, like the phrase “Say Cactus Jack sent me.”

Other variations include “It’s lit, sick mode,” “The Fornite guy burger,” or “You know why I’m here” which is often followed by customers playing Travis Scott’s “Sicko Mode.” 

@austing48

#travisscott #mcdonalds #itsdecent #theresnotoy #fyp

♬ original sound – Austing48

Eventually, McDonald’s said the promotion will continue through Oct. 4 as scheduled. However, starting Sept. 22, customers who want the meal have to order it through the McDonald’s app. So maybe that will intentionally slow sales, or perhaps downloads for that app soar as it did for Dunkin’ with D’Amelio’s help.

Ultimately, both collaborations have shown just how influential big names can be in the fast food and drink world. It’ll be interesting to see if and how chains will continue to use people with massive followings as advertising tools in the future. 

See what others are saying: (TMZ) (USA Today) (Chicago Sun Times) 

Continue Reading

Business

Twitter to Investigate Auto-Crop Algorithm After Accusations of Racial Bias

Published

6 days ago

on

September 21, 2020

By

  • Twitter users believe they discovered a racial bias in an algorithm the platform uses to automatically select which part of an image it shows in a photo preview.
  • Many argued that the auto-cropping tool showed a white bias after testing the theory with photos of Black and white people, cartoon characters, and even dogs. 
  • However, others who tested the theory generated results that did not support this idea. Regardless, most users admit that these experiments have their limitations and agree that the current results at least show that this is something worth looking into.
  • The company released a statement saying it tested its system for bias in the past but admitted it needs to conduct further analysis of it. Online, Twitter employees seemed to welcome the public discourse and the company promised to share its results as well as further actions it may take.

Potential White Bias 

Twitter responded to concerns over its automatic cropping algorithm Sunday after users believed they discovered a racial bias in the tool.

In 2018, Twitter began auto-cropping photos in its timeline previews to prevent them from taking up too much space in the main feed and to allow multiple photos to appear in the same tweet. To do this, the company uses several algorithmic tools that focus on the most important part of the picture, like faces or text. 

However, users recently began to spot issues with the algorithm. The first person credited for highlighting a potential problem was PhD student Colin Madland. He made his discovery while highlighting a different racial bias he thinks he found on the video-conference company Zoom. 

Madland tweeted that when his Black colleague uses a virtual background on Zoom, his head is erased. When he uploaded examples to show this happening to his Black colleague and not himself, he noticed that Twitter was only showing his own face in its preview. 

Soon after, others followed up with more targetted experiments. Cryptographic and infrastructure engineer Tony Arcieri, for example, tweeted out two long images with Senate Majority Leader Mitch McConnel and Former President Barack Obama. 

The two photos have the politicians stacked on top of each other in different orders but with white space in between them. The experiment showed that Twitter would focus on McConnell, no matter what order the photos were stacked in.

Another user found that the algorithm even focused on McConnell when two photos of Obama were present in a single stack.

A similar white preference appeared in examples of Black and white men in suits, Simpsons characters Lenny and Carl, and even black and white dogs. 

Examples That Don’t Support White Bias Theory

Others looking into this theory of a white bias found results that did not support the idea. 

For example, one user found that photos of Obama were cropped for the preview over photos of Donald Trump. 

Still, some researching the trends noted that these experiments do have their limitations and are likely influenced by tons of other factors. Some believe the algorithm recognized high profile figures or considers brightness and contrast, among other photo elements.

Twitter’s Chief Design Officer (CDO), Dantley Davis, even suggested that the choice of cropping sometimes takes brightness of the background into consideration.

However, ohers found examples that rejected that idea. Regardless, all these tests did a lot to convince people that there was something worth looking at here, including Davis, who has been experimenting himself.

He’s not alone in his research. In fact, plenty of other Twitter users have been going to great lengths to track their results as they try to study what is going on.

Twitter Promises to Investigate 

On Sunday, a Twitter spokesperson eventually released a statement admitting that the company had work to do.

“Our team did test for bias before shipping the model and did not find evidence of racial or gender bias in our testing,” the company explained.

“But it’s clear from these examples that we’ve got more analysis to do. We’ll continue to share what we learn, what actions we take, and will open source our analysis so others can review and replicate.” 

Davis also isn’t the only employee that has appeared to welcome all of this public discourse. The company’s Chief Technology Officer, Parag Argawal tweeted, “This is a very important question. To address it, we did analysis on our model when we shipped it, but needs continuous improvement. Love this public, open, and rigorous test — and eager to learn from this.”

See what others are saying; (The Next Web) (The Guardian) (Mashable) 

Continue Reading