Facebook deliberately broke privacy and competition law and should urgently be subject to statutory regulation, according to a devastating parliamentary report denouncing the company and its executives as “digital gangsters”.
The final report of the Digital, Culture, Media and Sport select committee’s 18-month investigation into disinformation and fake news accused Facebook of purposefully obstructing its inquiry and failing to tackle attempts by Russia to manipulate elections.
“Democracy is at risk from the malicious and relentless targeting of citizens with disinformation and personalised ‘dark adverts’ from unidentifiable sources, delivered through the major social media platforms we use every day,” warned the committee’s chairman, Damian Collins.
Anyone concerned with the anticompetitive state of digital advertising, and how to fix it, should focus like a laser on the circumstances surrounding the 2014 FTC’s pass on formally investigating if the Facebook-WhatsApp acquisition would “substantially lessen competition” under the Clayton Antitrust Act.
That obvious FTC mistake in hindsight, triggered a winner-take-all domino effect that not only tipped Facebook to a social advertising monopoly, but also tipped the overall digital advertising market to the anticompetitive digital advertising cartel that evidently predominates today.
[Editor Charlie sez: Now we know why they need so many lobbyists...]
As Facebook sought to become the world’s dominant social media service, it struck agreements allowing phone and other device makers access to vast amounts of its users’ personal information.
Facebook has reached data-sharing partnerships with at least 60 device makers — including Apple, Amazon, BlackBerry, Microsoft and Samsung — over the last decade, starting before Facebook apps were widely available on smartphones, company officials said. The deals allowed Facebook to expand its reach and let device makers offer customers popular features of the social network, such as messaging, “like” buttons and address books.
But the partnerships, whose scope has not previously been reported, raise concerns about the company’s privacy protections and compliance with a 2011 consent decree with the Federal Trade Commission.
Max Schrems, the thorn in Facebook’s side, has returned to launch the first challenges under the EU’s new data protection laws.
The complaints, filed on the day Europe’s General Data Protection Regulation (GDPR) comes into force, take aim at what he describes as Google and Facebook’s “forced consent”.
Under the GDPR, when users are asked to consent, they should be given a free choice – and it should not be a condition of using a service.
But Schrems’ complaints argue that the consent boxes popping up on the screens of users of Google, Facebook and their affiliates does not meet this standard.
They dangle the 4 per cent of annual turnover fines as a maximum possible penalty – €3.7bn, €1.3bn, €1.3bn, and €1.3bn, respectively – though regulators have stressed they won’t be handing out the top level fines willy-nilly.
As early Facebook employees recently told my colleague Nick Bilton,the social network’s rapid evolution into a global power-player has come as a relative shock. “They look at the role Facebook now plays in society, and how Russia used it during the election to elect Trump, and they have this sort of ‘Oh my God, what have I done’ moment,” admitted one. “I lay awake at night thinking about . . . what we could have done to avoid the product being used this way,“ said another. Others in Silicon Valley described [and royalty deadbeat] Mark Zuckerberg as out of touch with reality, unaware of the damage his brainchild has done. While C.O.O. Sheryl Sandberg, Zuckerberg’s indefatigable No. 2, recently acknowledged that “things happened on our platform that shouldn’t have happened,” she maintained that Facebook is not a news organization. “At our heart we’re a tech company,” she said in an interview last week. “We don’t hire journalists.”
[Editor Charlie sez: That’s straight outta The Circle, they don’t hire journalists, they get news feeds for free.]