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Friday, 1 March 2019

Too big to boycott (Bloomberg)

Bloomberg title: Too big to boycott

"Hi, everyone. It's Shira. It’s often easy to lose track of what to worry about when it comes to Facebook Inc. Should we fret about its dominance leading to a social network monopoly? Or should we be more concerned about potential invasions of privacy?

A new academic paper by a former advertising technology executive and Yale Law School graduate argues that those central anxieties are two sides of the same coin.

The paper was published this week in the Berkeley Business Law Journal. Titled in part, "The Antitrust Case Against Facebook," its author Dina Srinivasan makes a deeply researched argument, sketching out the company’s track record of issuing misleading statements about the user data it collected on its way to tech stardom.

Early in its history, Facebook competed against once-popular social networks like MySpace in part by pitching itself as protective of people's privacy. But once Facebook became an indispensable tool of digital life, she argues, it gained the power to reverse promises it had made not to gather certain types of information on people's online activity.

The stakes of this issue are high. Srinivasan's argument is similar to the one made recently by Germany's antitrust authority: Facebook abused its dominance to effectively eliminate people's choice about how much information the company can collect about them. (Facebook has said Germany misapplied antitrust law and it is appealing the decision.)

I'll leave it to legal experts to assess possible antitrust infractions. But I was drawn in by Srinivasan's selective, although not inaccurate, analysis of Facebook's history of data harvesting.

In one particularly compelling example, she focuses on Facebook’s "like" and "share" buttons. The company started to introduce the features in 2010, and they’re now on millions of websites. Many people don't know it, but those bits of software code enable the company to collect information from non-Facebook websites—whether or not people click them.

In the early years, Facebook told partners and the public that it wasn't tracking people's web surfing, nor would it use that information for personalized advertising. Srinivasan argues that the company's initial statements about what information it was collecting and when were not entirely correct. But it’s clear that for years, it was at least hesitant about such practices. There were enough competitive social network alternatives that there was blowback each time the company overreached in the types of information it wanted to gather or broadcast about people's actions online.

Then, in 2014, Facebook changed its policy to allow for use of web activity data in ad targeting. The company, writes Srinivasan, "would do precisely what it had spent seven years promising it did not and would not do, and finally accomplished what the previous competitive market had restrained it from doing.”

To Srinivasan, this was part of Facebook's pattern of bait-and-switch tactics surrounding data harvesting. It grew so popular, she says, it could eventually change the rules. The history is a useful guide to understand Facebook's present, as the company continues to make changes that are likely to generate yet more user data.

I was struck by the common thread between Facebook's multiple recent data privacy scandals, Srinivasan's reading of Facebook history and the conclusions from Germany's antitrust authority. People wary of Facebook now face an unappealing choice between pervasive surveillance or pulling out of a bedrock tool of modern life. It didn't get that way by accident. —Shira Ovide"


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