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US FTC orders Amazon, Facebook, 7 other tech companies to tell how they process user data

The United States Federal Trade Commission (FTC) has directed nine tech companies, including tech giants Facebook, Google and Amazon, to disclose how they collect, use and present personal information, along with their advertising and user engagement practices. In an order dated December 14, the FTC also asked for information on how these practices affect children and teenagers.

The companies required to provide this information are Amazon, ByteDance (which owns TikTok), Discord, Facebook, Reddit, Snap (owner of Snapchat), Twitter, WhatsApp (owned by Facebook) and YouTube (owned by Google). These companies have been given 45 days to respond to the order.

The FTC’s order comes just days after it, along with a group of 48 states, filed lawsuits against Facebook, accusing it of maintaining a monopoly in the personal social media market. Both lawsuits charged Facebook of excessive collection of user data. The FTC had proposed hiving off WhatsApp and Instagram as separate companies by reversing their acquisition by Facebook. A few months ago, another tech giant Google was subject to a major antitrust lawsuit, this time filed by the US Department of Justice.

The FTC has sought the following information from the nine companies:

  • How social media and streaming services “collect, use, track, estimate, or derive personal and demographic information”
  • How they determine which ads and content they should show to consumers
  • Whether users’ personal information is fed into algorithms or data analytics
  • How they measure, promote and research user engagement
  • How their practices affect children and teens

Rohit Chopra, Rebecca Kelly Slaughter and Christine S. Wilson, three of four FTC commissioners who voted ‘yes’ on the order, said in an official statement that questions of “business models, algorithms, and data collection and use have gone unanswered”.

They said that both policymakers and the general public are in the dark about what social media and streaming websites do to capture and sell users’ data and attention. “It is alarming that we know so little about companies that know so much about us […] Too much about the industry remains dangerously opaque” they said.

Going into more detail into what the FTC wishes to achieve from the data, the commissioners said it would help the agency know how many users the companies have, how they got that information, what kind of inferences they are able to make about user attributes and interactions. “The questions push to uncover how children and families are targeted and categorized. These questions also address whether we are being subjected to social engineering experiments. And the FTC wants to better understand the financial incentives of social media and video streaming services.”

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