Face­book’s ‘cut-throat tac­tics’ re­vealed

Face­book al­legedly of­fered ad­ver­tis­ers spe­cial ac­cess to user data. Craig Tim­berg and El­iz­a­beth Dwoskin re­port.

The Dominion Post - - World -

Atrove of emails and in­ter­nal doc­u­ments, which were re­leased by a Bri­tish law­maker this week, il­lus­trate how Face­book rose to dom­i­nance years ago by us­ing peo­ple’s data as a bar­gain­ing chip, un­der­min­ing the so­cial me­dia gi­ant’s claim that changes to its busi­ness prac­tices were mo­ti­vated by a de­sire to pro­tect peo­ple’s pri­vacy.

The more-than-250-pages of doc­u­ments, which a Bri­tish par­lia­men­tary com­mit­tee re­cently ob­tained as part of a wide-rang­ing in­ves­ti­ga­tion into Face­book, re­volve around a de­ci­sion that Face­book made in 2014 and 2015 to cut off de­vel­op­ers’ ac­cess to posts, pho­tos and other pro­file in­for­ma­tion from Face­book users.

The in­ter­nal com­mu­ni­ca­tions, some of them from Face­book chief ex­ec­u­tive Mark Zucker­berg, ap­pear to show Face­book trading ac­cess to user data in exchange for ad­ver­tis­ing buys and other con­ces­sions, which would con­tra­dict Face­book’s long-stand­ing claim that it doesn’t sell peo­ple’s in­for­ma­tion.

‘‘We’ve never sold any­one’s data,’’ Zucker­berg said in a post on Thurs­day.

He added that the emails re­leased by Damian Collins, the chair­man of the Bri­tish par­lia­men­tary com­mit­tee, ‘‘were only part of our dis­cus­sions’’.

The records re­leased by Collins are part of an on­go­ing fed­eral court case in Cal­i­for­nia brought by an app de­vel­oper called Six4Three. Face­book said the Six4Three doc­u­ments were mis­lead­ingly crafted and did not rep­re­sent the com­pany’s prac­tices or poli­cies.

The cut-throat tac­tics de­ployed by Face­book in its early years as a pub­lic com­pany, and de­tailed in the newly re­leased doc­u­ments, caught up with the so­cial me­dia gi­ant this year.

They are likely to fuel per­sis­tent claims that the com­pany was cava­lier with peo­ple’s per­sonal in­for­ma­tion and set off even more concern among the pub­lic and law­mak­ers around the world that Face­book’s foot­print is a risk to con­sumers and com­peti­tors alike.

A se­ries of emails from Oc­to­ber 2012 re­veal Zucker­berg’s keen in­ter­est in fig­ur­ing out how to ex­tract rev­enue from Face­book’s trove of user data – and the app de­vel­op­ers who re­lied on it. ‘‘There’s a big ques­tion on where we get rev­enue from,’’ Zucker­berg wrote to one of his ex­ec­u­tives.

‘‘With­out lim­it­ing distri­bu­tion or ac­cess to friends who use this app, I don’t think we have any way to get de­vel­op­ers to pay us at all be­sides of­fer­ing pay­ments and ad net­works,’’ he con­tin­ued.

Zucker­berg’s pri­vate state­ments ap­pear to con­tra­dict a stance he had long main­tained pub­licly – that app de­vel­op­ers’ ac­cess was open and free.

Face­book said the 2015 de­ci­sion to cut off de­vel­op­ers’ ac­cess to peo­ple’s in­for­ma­tion was mo­ti­vated by pri­vacy con­cerns. But it also caused dozens of busi­nesses, in­clud­ing Six4Three, to shut down, and it was a turn­ing point in Face­book’s re­la­tion­ship with the startup com­mu­nity in Sil­i­con Val­ley.

Collins’ in­ter­est in the sealed and heav­ily redacted doc­u­ments springs from the Bri­tish Gov­ern­ment’s in­quiry into Face­book’s deal­ings with political con­sul­tancy Cam­bridge An­a­lyt­ica, which also ben­e­fited from the same ac­cess to user data.

Face­book re­vealed ear­lier this year that Cam­bridge An­a­lyt­ica was able to ob­tain data on 87 mil­lion Face­book users.

Since the Cam­bridge An­a­lyt­ica con­tro­versy erupted in March, law­mak­ers have re­peat­edly ques­tioned Face­book about its re­la­tion­ships with data part­ners, and the in­ci­dent has spawned sev­eral in­ves­ti­ga­tions. In the United States, the Jus­tice Depart­ment, the Se­cu­ri­ties and Exchange Com­mis­sion and the FTC have been in­ves­ti­gat­ing Face­book’s han­dling of this data and its pub­lic rep­re­sen­ta­tions about it.

The trove re­leased by Collins ‘‘high­lights ar­eas in which the com­pany was know­ingly de­cep­tive’’, said Ashkan Soltani, a for­mer top tech­nol­o­gist at the FTC. ‘‘It speaks to how both disin­gen­u­ous the com­pany is, and how anti-com­pet­i­tive some of their prac­tices are.’’

The newly re­leased cor­re­spon­dence be­tween Zucker­berg and his top brass be­tween 2012 and 2015 – though par­tial and col­lected by plain­tiffs in a le­gal bat­tle – of­fer in­sights into how Face­book strug­gled to bal­ance its need to make money from smart­phones with the am­bi­tions of de­vel­op­ers who had come to rely on its rich trove of data about peo­ple’s re­la­tion­ships and pref­er­ences.

In his post on Thurs­day, Zucker­berg said that the in­ter­nal con­ver­sa­tions re­flected the need to be­come ‘‘eco­nom­i­cally sus­tain­able’’ as the com­pany tran­si­tioned from desk­top to a mo­bile app, and that the ac­tions that the com­pany took against against de­vel­op­ers were a re­sponse to apps that were abus­ing peo­ple’s pri­vacy.

But pri­vacy did not ap­pear to fig­ure heav­ily into the ex­ec­u­tives’ dis­cus­sions or into Zucker­berg’s own emails. The emails were largely fo­cused on com­pe­ti­tion and on how to lever­age Face­book’s ex­ten­sive re­la­tion­ships with app de­vel­op­ers, in­clud­ing Lyft, Airbnb, Nis­san, Tin­der and Net­flix. Ex­ec­u­tives also used a free app that Face­book had ac­quired, called Onavo Pro­tect, to mon­i­tor how fre­quently con­sumers were log­ging into po­ten­tially com­pet­i­tive ser­vices, such as the live video-stream­ing app Vine.

As Vine was get­ting off the ground, a Face­book man­ager sug­gested that the com­pany im­me­di­ately cut off the po­ten­tial com­peti­tors’ ac­cess to data, ac­cord­ing to the doc­u­ments. ‘‘Yup, go for it,’’ Zucker­berg replied.

The dis­cus­sions also cen­tred around a con­tro­ver­sial prac­tice known as whitelist­ing, in which Face­book gave se­lect com­pa­nies pref­er­en­tial ac­cess to data af­ter the 2015 re­stric­tions went into ef­fect. Zucker­berg did not tell the US Congress about the com­pany’s whitelist­ing when he tes­ti­fied in April, but sub­se­quent re­ports have ex­posed priv­i­leged re­la­tion­ships bro­kered by Face­book. The com­pany has since con­ceded that more than 100 apps re­ceived spe­cial priv­i­leges, in part to main­tain their func­tion­al­ity as the tran­si­tion to less data went into ef­fect.

‘‘It is not clear that there was any user con­sent for this,’’ Collins said of the whitelist­ing. ‘‘Nor how Face­book de­cided which com­pa­nies should be whitelisted or not.’’

He said ma­jor changes to Face­book’s un­der­ly­ing poli­cies and tech­nol­ogy were driven by a de­sire to ob­tain ‘‘in­creas­ing rev­enues from ma­jor app de­vel­op­ers’’.

Justin Brook­man, the direc­tor of con­sumer pri­vacy and tech­nol­ogy pol­icy for Con­sumers Union, said the whitelist­ing amounts to a ‘‘prima fa­cie vi­o­la­tion’’ of a 2011 con­sent de­cree that Face­book bro­kered with the US Gov­ern­ment over a pre­vi­ous pri­vacy mishap. That agree­ment stip­u­lated that Face­book could not give away peo­ple’s data to de­vel­op­ers with­out their per­mis­sion, and it could carry fines for vi­o­la­tions.

There’s ‘‘pretty clear doc­u­men­ta­tion that they had a new set­ting to say, ‘Don’t share my new data with what­ever crap app my friends in­stalled’, and then they went into agree­ment with a bunch of apps to get them that data,’’ said Brook­man, who pre­vi­ously served as a top tech aide at the agency.

The doc­u­ments emerged out of a le­gal bat­tle that has been qui­etly brewing in San Mateo County fed­eral court in Cal­i­for­nia be­tween Six4Three and Face­book. They came into the pos­ses­sion of Bri­tish au­thor­i­ties late last month when Six4Three de­vel­oper Ted Kramer trav­elled to Lon­don with dig­i­tal copies of thou­sands of the records. Bri­tish au­thor­i­ties took cus­tody of them, sidestep­ping the seal­ing or­der of the Cal­i­for­nia court.

Kramer’s com­pany was the de­vel­oper of Piki­nis, an app that en­abled peo­ple to find pho­tos of Face­book users wear­ing biki­nis. The app was built on the back of Face­book’s data, which Six4Three and thou­sands of other de­vel­op­ers ac­cessed through a feed known as an ap­pli­ca­tion pro­gram­ming in­ter­face, or API.

For years, Face­book ac­tively courted de­vel­op­ers to build apps that en­cour­aged peo­ple to spend more time on its desk­top platform. Af­ter the rise of smart­phones, Face­book even­tu­ally be­came large enough that it didn’t need to rely on de­vel­op­ers for en­gage­ment and ideas.

In 2014, Face­book said it was re­strict­ing de­vel­op­ers’ ac­cess to the API, cit­ing pri­vacy con­cerns from users who com­plained that their data was be­ing shared with out­siders with­out their knowl­edge. Many busi­nesses, in­clud­ing Six4Three, shut down as a re­sult.

Six4Three says pri­vacy was not the rea­son Face­book shut down the API. The de­vel­oper says Face­book re­alised it could use its data feed as lever­age, to pres­sure busi­nesses to buy ad­ver­tis­ing that would fuel its then-nascent mo­bile-ad busi­ness.

The emails also sug­gest the ex­tent to which Face­book users and de­vel­op­ers may have been kept in the dark about the com­pany’s dat­a­col­lec­tion prac­tices. Com­pany prod­uct man­agers dis­cussed test­ing new fea­tures to col­lect call logs on An­droid smart­phones in a way that might have made it harder for users to un­der­stand what they were giv­ing away. They de­bated col­lect­ing call log data from users in ways that would by­pass the pri­vacy per­mis­sions peo­ple nor­mally check off when sign­ing up for an app.

They ac­knowl­edged the po­ten­tial blow­back from their de­ci­sions. ‘‘This is a pretty high-risk thing to do from a PR per­spec­tive but it ap­pears that the growth team will charge ahead and do it,’’ the email read. They dis­cussed how the idea, along with other changes, threat­ened to be­come ‘‘a meme’’ that jour­nal­ists could turn into a story about how ‘‘Face­book uses new An­droid up­date to pry into your pri­vate life in ever more ter­ri­fy­ing ways.’’ – Washington Post

Rev­e­la­tions about Face­book are likely to fuel per­sis­tent claims that the com­pany was cava­lier with peo­ple’s per­sonal in­for­ma­tion.


Doc­u­ments seized by the Bri­tish Parliament, some of them from Face­book chief ex­ec­u­tive Mark Zucker­berg, ap­pear to show Face­book trading ac­cess to user data in exchange for ad­ver­tis­ing buys and other con­ces­sions.

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