Facebook falls on the ropes, dazed by intense backlash
FTC investigates; Congress summons Zuckerberg
It’s officially open season on Facebook.
Angry users and money-losing investors. U.S. and European regulators. State attorneys general and lawmakers. They all say the social media giant needs to be held accountable for the misuse of personal information of as many as 50 million Facebook users by data analysis firm Cambridge Analytica, which said it helped Donald Trump get elected.
The chances of a sweeping regulatory backlash against Facebook in the USA and overseas have never been higher.
Facebook’s stock took a beating Monday after the Federal Trade Commission said it was investigating and the attorneys general for 37 U.S. states and territories sought details on how Facebook monitored what app developers did with data collected from users and whether the website had sufficient safeguards to keep that data from being misused.
Salesforce CEO Marc Benioff urged regulation, noting that alcohol and cigarettes are regulated but not social media.
“Smoking, drinking too much, & spending too much time on social
media: none of these things are good for you,” Benioff wrote on Twitter.
Over the weekend, Apple CEO Tim Cook said, “This certain situation is so dire and has become so large that probably some well-crafted regulation is necessary.”
Facebook is under fire after disclosures that Cambridge Analytica improperly received data on tens of millions of Facebook users who downloaded a psychology app and data on their friends who had not given permission to share information with the app.
Last week, Facebook’s Chief Operating Officer Sheryl Sandberg said the Silicon Valley company would be “open to regulation” but did not specify what kind or how much.
The FTC said it’s investigating whether Facebook violated a consent decree in 2011 to protect users’ privacy. The decree requires Facebook to notify users and get explicit permission before sharing their personal information beyond the limits in their privacy settings. Each violation of the agreement would cost Facebook up to $40,000 a day.
“There’s some fairly strong commitments built into the settlement,” said William Kovacic, a professor of law at George Washington University who chaired the FTC from March 2008 to March 2009. “The critical question is looking in detail at what happened here. Did Facebook abide by it?”
Any regulatory crackdown would be limited because the United States doesn’t have strong enough rules in place to protect people’s data, said Woodrow Hartzog, a professor of law and computer science at Northeastern University.
The greater regulatory threat looms from overseas. More stringent privacy rules will take effect in Europe in May, handing users more control over what information Internet companies collect on them.
“Facebook should be nervous about Europe,” University of Washington law professor Ryan Calo said. “Europe has both the regulatory hooks they need and also the will.”
Monday, Sen. Chuck Grassley, RIowa, requested that Mark Zuckerberg testify at a Senate Judiciary Committee hearing on consumer data privacy April 10. It’s the third committee, along with the Senate and House commerce committees, to demand the Facebook CEO appear.
Forty-one percent of Americans say they trust Facebook to obey laws that protect their personal information, according to a Reuters Ipsos poll released Sunday. In comparison, Amazon is trusted by 66%, Google by 62%, Microsoft by 60% and Yahoo by 40%. A pair of massive breaches at Yahoo were revealed in 2016.