Science –Technology
The FTC claims Meta misled parents about child safety measures and proposes a ban on profiting from minors’ data
Meta said in a statement that the FTC action was a “political stunt” and that the FTC had failed to act against “Chinese companies, such as TikTok.”
The US Federal Trade Commission accused Meta’s Facebook on Wednesday of misleading parents about child protections and proposed tightening an existing privacy agreement to include a prohibition on making money from minors’ data.
The FTC specifically stated that Facebook misled parents about how much control they had over who their children communicated with in the Messenger Kids app and was deceptive about how much access app developers had to users’ private data, in violation of a 2019 privacy agreement.
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The proposed changes by the FTC include prohibiting Facebook from profiting from data collected on users under the age of 18, including in its virtual reality business. It would also face new constraints when using facial recognition technology.
On Wednesday, Meta shares fell as much as 2% but recovered most of their losses, closing down 0.3 percent at $238.50 (roughly Rs. 19,400).Meta, which also owns Instagram, derives more than 98 percent of its revenue from digital ads targeted based on its users’ personal data.
The company maintains the world’s largest social networks, but it is competing for the attention of young users with the short video app TikTok, which rose to popularity with American teens several years ago.Meta said in a statement that the FTC action was a “political stunt” and that the FTC had failed to act against “Chinese companies, such as TikTok.”
“We will fight this action vigorously and expect to prevail,” the company stated.
The FTC action on Wednesday is the first step in changing the 2019 agreement. Facebook has thirty days to respond. Any commission decision can also be appealed to an appeals court by the company.
“This is a very substantial statement from the FTC about whether or not Meta has fulfilled its duties to protect children,” Insider Intelligence’s Debra Williamson said, adding that “the revenue implications are unlikely to be very large.”According to Williamson, 5.2 percent of Facebook’s monthly US users are under the age of 18, as are 12.6 percent of Instagram users.
“Facebook has repeatedly violated its privacy promises,” said Samuel Levine, director of the Federal Trade Commission’s Bureau of Consumer Protection. “The company’s carelessness has put young users at risk, and Facebook must account for its mistakes.””Facebook has repeatedly violated its privacy promises,” said Samuel Levine, director of the Federal Trade Commission’s Bureau of Consumer Protection. “The company’s carelessness has put young users at risk, and Facebook must account for its mistakes.”
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The FTC has previously settled with Facebook over privacy violations twice.
The first occurred in 2012. In 2019, Facebook agreed to pay a record $5 billion (roughly Rs. 408 crore) fine to settle allegations that it violated the 2012 consent order by misleading users about their level of control over their personal data. The order was completed in 2020.
Separately, the FTC sued to prevent Meta from acquiring virtual reality content creator Within Unlimited, but was unsuccessful in court. The agency also requested that a federal court order Facebook to sell Instagram, which it purchased for $1 billion (roughly Rs. 8,170 crore) in 2012, and WhatsApp, which it purchased for $19 billion (roughly Rs. 1,552,59 crore) in 2014. The investigation is ongoing.
