UPDATED 21:50 EDT / MAY 03 2023

POLICY

FTC wants to stop Meta from monetizing young people’s data

The Federal Trade Commission today shared some stern words with Meta Platforms Inc., accusing the company of breaching a child privacy protection order, adding that it’s time there was a “blanket prohibition” on Meta collecting the data of kids.

The FTC, which has been something of a bête noire for Meta over the years, said Meta had violated a 2020 privacy order related to the Cambridge Analytica scandal. At the time, Meta, which was then Facebook Inc., agreed to pay a $5 billion fine, as well as assent to increased oversight while implementing more stringent data controls. That became the biggest privacy fine ever handed out by the FTC.

Meta will be familiar with this story. The FTC has now taken action three times against the company over what it sees as violations of privacy. In this new accusation, the commission has said Meta hasn’t been honest about parental controls regarding the Messenger Kids app and it also says Meta has lied about how developers use people’s private data.

“Facebook has repeatedly violated its privacy promises,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection. “The company’s recklessness has put young users at risk, and Facebook needs to answer for its failures.”

The FTC is now asking that Meta agree not to not collect data on anyone under the age of 18 on all its platforms, including virtual reality products, which will mean products related to Meta’s metaverse — its big bet on the future. That means companies will not be able to target people under the age of 18 with ads for all the items offered in the metaverse, which presumably would be one of Meta’s biggest sources of revenue.

The company will also have to agree to other consumer protections, such as how it uses facial recognition technology. When Meta releases new products, the FTC wants a third party to assess matters concerning privacy. Meta fired back, employing perhaps uncharacteristically steely language. A company spokesperson called it a “political stunt,” saying the FTC can’t just unilaterally hit Meta with what he said are “do-overs” to court-approved, negotiated settlements.

“The timing is striking, coming just after the agency lost its bipartisan membership and just before the FTC was to get an update on our compliance efforts,” he said in the same statement. He disagrees that Meta has violated any of the privacy orders imposed on it by the FTC, calling the approach by the commission an “abuse of authority and wrong on the facts.” He said the FTC had reached a “new low” adding, “The two privacy incidents the FTC identified today to support their action were discovered by us, fixed, and publicly disclosed three years ago.”

Meta has 30 days to address the accusation, after which the FTC will get to vote on what happens next: Adopt the new changes, or alter them in some way. This comes at a time after years of social media companies being blamed for the worrying increase in mental health issues facing the young, when companies such as Meta have been accused of prioritizing growth over safety.

Photo: Dima Solomin/Unsplash

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