“FTC finds ‘staggering’ level of user surveillance by social media, streaming services”

With that headline, Jackson Walker reported that FTC reports surveillance by social media, streaming services (baltimoresun.com)(Sept. 19, 2024).

According to the Baltimore Sun, “[r]eport authors called on Congress to pass federal privacy legislation to protect users.”  I recently blogged about a similar issue in Data Collection by Cars With Connectivity (Sept. 17, 2024)(discussing calls for federal privacy legislation regarding use of data collected by automobiles).

The FTC Staff Report Finds Large Social Media and Video Streaming Companies Have Engaged in Vast Surveillance of Users with Lax Privacy Controls and Inadequate Safeguards for Kids and Teens | Federal Trade Commission (Sept. 19, 2024).

The FTC report states that social media and video streaming services “engaged in vast surveillance of consumers in order to monetize their personal information while failing to adequately protect users online, especially children and teens.”  Id.  FTC chair Lina M. Khan stated that the data is worth billions of dollars annually.  Targeted advertising accounts for most of the revenue. Id.

“The report found that the companies collected and could indefinitely retain troves of data, including information from data brokers, and about both users and non-users of their platforms. The staff report further highlights that many companies engaged in broad data sharing that raises serious concerns regarding the adequacy of the companies’ data handling controls and oversight.”  Id.

“The report found that users and non-users had little or no way to opt out of how their data was used by these automated systems….”  Id.  It made a number of recommendations. Id.

The report is posted at A Look Behind the Screens: Examining the Data Practices of Social Media and Video Streaming Services (ftc.gov)(Sept. 2024).

The Preface states that the report “shows how the tech industry’s monetization of personal data has created a market for commercial surveillance, especially via social media and video streaming services, with inadequate guardrails to protect consumers.  The report finds that these Companies engaged in mass data collection of their users and – in some cases – non-users.  It reveals that many Companies failed to implement adequate safeguards against privacy risks.  It sheds light on how Companies used our personal data, from serving hyper-granular targeted advertisements to powering algorithms that shape the content we see, often with the goal of keeping us hooked on using the service.  And it finds that these practices pose unique risks to children and teens, with the Companies having done little to respond effectively to the documented concerns that policymakers, psychologists, and parents have expressed over young people’s physical and mental wellbeing.”

The FTC’s Report also concludes that:

The Status Quo Is Unacceptable: The amount of data collected by large tech companies is simply staggering. They track what we read, what websites we visit, whether we are married and have children, our educational level and income bracket, our location, our purchasing habits, our personal interests, and in some cases even our health conditions and religious faith. They track what we do on and off their platforms, often combining their own information with enormous data sets purchased through the largely unregulated consumer data market. And large firms are increasingly relying on hidden pixels and similar technologies – embedded on other websites – to track our behavior down to each click. In fact, the Companies collected so much data that in response to the Commission’s questions, they often could not even identify all the data points they collected or all of the third parties they shared that data with.

The report leaves no doubt that without significant action, the commercial surveillance ecosystem will only get worse.  Our privacy cannot be the price we pay to accomplish ordinary basic daily activities, and responsible data practices should not put a business at a competitive disadvantage.

The full scope of the findings and recommendations is beyond the reach of this blog.  Suffice it to say that the FTC determined that the companies’ “data practices posed risks to users’ and non-users’ data privacy and the Companies’ data collection, minimization, and retention practices were inadequate….” It adds that “[c]hildren and teens are a uniquely vulnerable population, but the Companies’ policies have failed to adequately protect them—this is especially true of teens….”

For blogs on  In Re: Social Media Adolescent Addiction/Personal Injury Products Liability Litigation, 2024 WL 1786293 (N.D. Cal. Feb. 20, 2024), see An Epilog:  4 Things You Never Wanted to Hear + 8 Lessons & a Dispute Over Revealing Recipients of Litigation Hold Notices, All in One Case (May 10, 2024). In that litigation, plaintiffs allege that “defendants target children as a core market and designed their platforms to appeal to and addict them.”  In re Soc. Media Adolescent Addiction, 2023 WL 7524912, at *2.