The Federal Trade Commission has pulled up some of the biggest social media and video streaming players in the world and launched a probe into their user privacy and data practices.
In an order issued on December 14, the Commission directed Facebook, WhatsApp, Snap, Twitter, YouTube, ByteDance, Twitch, Reddit, and Discord to share a long list of information – including how many users these companies have, how active the users are, what the companies know about them, how they got that information, and what steps they take to continue to engage users.
The order was issued under a provision of the Section 6(b) of FTC Act, which gives the commission the authority to conduct wide-ranging studies that don’t have “a specific law enforcement purpose”. The companies have 45 days to respond.
Intrusion into private lives
The commission says it wants to better understand if and how the business models of these Internet giants influence what Americans hear and see, with whom they talk, and what information they share, or how children and families are targeted and categorized.
And most importantly – “These questions also address whether we are being subjected to social engineering experiments”.
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As concerns mount regarding the impact of the tech companies on Americans’ privacy and behavior, the probe, FTC says “will lift the hood on the social media and video streaming firms to carefully study their engines.”
“These digital products may have launched with the simple goal of connecting people or fostering creativity. But, in the decades since, the industry model has shifted from supporting users’ activities to monetizing them. This transition has been fueled by the industry’s increasing intrusion into our private lives. Several social media and video streaming companies have been able to exploit their user-surveillance capabilities to achieve such significant financial gains that they are now among the most profitable companies in the world,” FTC Commissioners Rebecca Slaughter, Christine Wilson and Rohit Chopra, said in a statement.
Holding that questions about business models, algorithms, and data collection and use have gone unanswered, FTC said “policymakers and the public are in the dark about what social media and video streaming services do to capture and sell users’ data and attention. It is alarming that we still know so little about companies that know so much about us.”
Tech giants under increasing scrutiny
The FTC order come as tech giants have come under increasing administrative scrutiny in the past few months. In an antitrust lawsuit filed last month, FTC accused Facebook of gobbling up rivals like Instagram to weaken competition. Before that in October, the Department of Justice filed case against Google accusing it of creating a monopoly over Internet search functionality and advertising.
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ByteDance, the parent company of Tiktok, have already been facing issues with the US administration over its Chinese connections.
Earlier, towards the beginning of the year, the FTC had announced that it will closely examine every acquisition made by Alphabet, Amazon, Apple, Facebook and Microsoft including the terms, scope, structure and purpose of each transaction made between January 1, 2010 and December 31, 2019. On February 11, the five tech giants were Special Orders “requiring them to provide information about prior acquisitions not reported to the antitrust agencies under the Hart-Scott-Rodino (HSR) Act.”
“The orders will help the FTC deepen its understanding of large technology firms’ acquisition activity, including how these firms report their transactions to the federal antitrust agencies, and whether large tech companies are making potentially anticompetitive acquisitions of nascent or potential competitors that fall below HSR filing thresholds and therefore do not need to be reported to the antitrust agencies,” the commission had said in the notice.
