The Federal Trade Commission proposed a “blanket ban” that would prevent Meta from monetizing children’s data Wednesday. FTC Meta says–The company formerly known as Facebook–It fails to comply with the current 2020 Privacy Order by misleading parents about the control they have over Facebook Messenger, and misrepresenting the ways third-party app developers can access it.
“Facebook has repeatedly broken its privacy promises,” Samuel Levine, director of the Federal Trade Commission’s Office of Consumer Protection, said in a paper. launch. “The company’s recklessness puts young users at risk, and Facebook needs to respond to its failures.”
Meta did not immediately respond to a request for comment.
The FTC’s proposal prohibits Meta from making any money on data it collects from users under the age of 18, noting that the change would also apply to the company’s virtual reality efforts in Metaverse. The change will also limit the data Meta collects about minors to information necessary for the security and operation of its services. Adding insult to injury to Meta, the FTC also wants to ban Meta from using this data to make money until after users’ 18th birthdays.
For now, these are suggestions, not orders, because the FTC has to give Meta the opportunity to respond before reaching a final decision.
This is the third time the FTC has intervened in Meta’s alleged unfair and deceptive business practices. The most significant came in 2020, when the Federal Trade Commission (FTC) reached a $5 billion settlement with the company that included a number of requirements, including a privacy review for any new products or services, stricter security rules, and limits on the use of facial recognition ( a condition based on a problem with Facebook facial recognition settings revealed by this reporter).
The proposal would be a sea change for the world’s largest social media company. However, it may not have a significant impact on Meta’s bottom line, according to Debra Aho Williamson, principal analyst at Insider Intelligence.
“The vast majority of monthly Facebook and Instagram users are over 18. On Facebook, only 5.2% of monthly users in the US will be under 18 this year. On Instagram, only 12.6% will be under 18,” said Ahu Williamson. “While advertisers use both platforms to target teen users, the majority of ad spend will naturally go toward reaching adults, who make up nearly 95% of Facebook users in the US and more than 87% of Instagram users.”
However, the other changes included in the FTC’s proposal could have a significant impact on Meta’s ability to innovate in an instant The company is struggling to regain its composure in a changing technological landscape. Under the proposed order, Meta will not be permitted to release any new products, services or features without written confirmation from an independent third party assessor confirming that the company is in compliance with privacy requirements. The company will also have to obtain users’ positive consent before using facial recognition technology.
“If this part of the proposed changes are implemented, the FTC will effectively put a huge speed bump on the new Meta roadmap for product,” said Ahu Williamson.
The ad argues that Meta violated the 2020 FTC order while it went into effect and immediately thereafter. The FTC alleges that Meta lied to parents about whether they could control who kids talk to on Facebook Messenger, and in some cases allows kids to talk to people who aren’t approved in text messages and group calls. The FTC says this not only violated its agreement with Meta, but also the Children’s Online Privacy Protection Act, better known as COPPA.
The FTC’s proposal would apply to all Meta services, including Facebook, Instagram, WhatsApp, Oculus, and Horizon Worlds.