FTC's Misses Opportunity To Understand Social Media; Instead Goes For Weird Fishing Expedition Against Odd Grouping Of Companies

from the this-could-have-been-helpful dept

On Monday, the FTC announced that it was issuing what's known as 6(b) orders to nine social media and video streaming companies, demanding a fairly massive amount of information regarding their data collection and usage policies, as well as their advertising practices. To me, this is a huge missed opportunity. If the FTC is truly trying to gain a better understanding of data collection, privacy, and advertising practices, perhaps to better inform Congress on how to, say, pass a truly comprehensive (and useful?!?) privacy legislation, then there are ways to do that. But this... is not that. This looks like a weird fishing expedition for a ton of unrelated information, from an odd selection of nine companies, many of whom are in a very different business than the others. It leaves me quite perplexed.

First, let's look at the odd selection of companies. The letters are going to:

  • Amazon (apparently including Twitch)
  • Bytedance (TikTok)
  • Discord
  • Facebook
  • Reddit
  • Snap
  • Twitter
  • WhatsApp (owned by Facebook)
  • YouTube
Okay, so they've definitely focused on many of the big players, but they've also left out a ton as well. Where's LinkedIn? Or Github? Or WeChat? Or Pinterest? Or Quora? They list Facebook and Whatsapp... but not Instagram? Where's Zoom? Now it's true that sometimes the FTC will randomly sample a bunch of companies in a particular industry to get a look at certain practices -- but for that to make sense, you want to sample from a set of similarly situated companies. This is... not that.

For the smaller companies on the list, such as Reddit and Discord, the FTC demanding they file a ton of paperwork in a very short time frame is going to mean a tremendous waste of time.

The second concern is the broad nature of the requests. The "sample order" is massive. There are 53 separate requests, many with multiple sub-parts. They're not just asking for specific information, but rather going on what appears to be an incredibly broad fishing expedition for information about a wide variety of practices at all of these companies -- including broad demands for future strategies and plans. For example, beyond just information on the number of users, it demands all documents relating to "business strategies or plans," "research and development efforts," "strategies or plans to reduce costs, improve products or services..." It also seems to be demanding all "presentations to management committees, executive committees, and boards of directors."

That feels like a fishing expedition, rather than an attempt to actually understand data collection and usage practices.

There are categories of information included here that I think it would be useful for the FTC to understand. But there's just so much information requested that it seems likely to bury the useful information.

The one FTC Commissioner who dissented from this effort, Noah Joshua Phillips, raises important questions in his dissent:

Effective 6(b) orders look carefully at business practices in which companies engage in a manner designed to elicit information, understand it, and then present it to the public in way that is usable and can form a basis for sound public policy.

The first step is to select a group of recipients that will permit such examination, usually a group of firms engaged in conduct that can be compared. But the logic behind the choice of recipients here is not clear at all. The 6(b) orders target nine entities: Facebook, WhatsApp, Snap, Twitter, YouTube, ByteDance, Twitch, Reddit, and Discord. These are different companies, some of which have strikingly different business models. And the orders omit other companies engaged in business practices similar to recipients, for example, Apple, Gab, GroupMe, LinkedIn, Parler, Rumble, and Tumblr, not to mention other firms the data practices of which have drawn significant government concern, like WeChat. The only plausible benefit to drawing the lines the Commission has is targeting a number of high profile companies and, by limiting the number to nine, avoiding the review process required under the Paperwork Reduction Act, which is not triggered if fewer than ten entities are subject to requests.

Phillips calls out the same broad demands I raised above regarding business plans, R&D and presentations, noting:

Such a request would be suited to an antitrust investigation. But as part of an inquiry ostensibly aimed at consumer privacy practices, it amounts to invasive government overreach. And that is just one of the order’s 50-plus specifications.

And, finally, he highlights how this effort is just demanding way too much information to be of use for a comprehensive policy recommendation:

The biggest problem is that today’s 6(b) orders simply cover too many topics to make them likely to result in the production of comparable, usable information—yet another feature proper oversight and public comment could have flagged. Rather than a carefully calibrated set of specifications designed to elicit information that the agency could digest and analyze as a basis for informing itself, Congress, stakeholders, and the public, these 6(b) orders instead are sprawling and scattershot. Their over 50 specifications, most with numerous and detailed subparts, address topics including, but not limited to: advertising (reach, revenue, costs, and number and type); consumer data (collection, use, storage, disclosure, and deletion); as noted above, all strategic, financial, and research plans; algorithms and data analytics; user engagement and content moderation; demographic information; relationships with other services; and children and teens (policies, practices, and procedures).

Recipients of 6(b) orders typically negotiate to limit their productions, to tailor them in light of their specific business models and business practices. Perhaps the Commission will push back on attempts to do so, devoting additional lawyers to litigating the orders and having a federal judge oversee them, rather than OIRA. Or negotiation may reduce the burdens. But if that happens, each recipient will be responding to a different set of negotiated specifications. That certain of the companies in question have very different business models makes this even more likely. The end result of that is, say, the agency learning a lot about one recipient’s advertising practices, but not as much about its algorithms. For another recipient, the agency might receive information about privacy practices but very little about its plans to expand. Each of the nine recipients will produce differing, if any, amounts of information to each of the 50-plus specifications.

I actually think it would be a good thing for the FTC to better understand how these companies work and their practices. I think it could be useful for them to gain such an understanding, and then make recommendations on a comprehensive federal privacy law. But I don't see how this fishing expedition does any of that. Instead, it just asks for basically everything and the kitchen sink from a somewhat random selection of companies, some of whom will have difficulty producing all of this information.

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Filed Under: data, data collection, data protection, fishing expedition, ftc, privacy, social media, video streaming
Companies: amazon, bytedance, discord, facebook, reddit, snap, tiktok, twitch, twitter, whatsapp, youtube


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  • identicon
    Glenn, 15 Dec 2020 @ 9:41am

    It feels like Trump said, "Screw 'em... now!"

    Lame duck PoS.

    reply to this | link to this | view in chronology ]

  • This comment has been flagged by the community. Click here to show it
    identicon
    Faber Schnidejoch, 15 Dec 2020 @ 10:22am

    Corporations are NOT persons with rights: gov't can DEMAND info!

    demanding a fairly massive amount of information regarding their data collection and usage policies

    I've sort of been waiting to use this point, heh, heh.

    Again, the first act of persons wishing to form a corporation is to ASK The Public for PERMISSION. Second act is to SIGN AN AGREEMENT TO SERVE The Public and PAY A FEE for the privilege.

    But I don't see how this fishing expedition does any of that.

    You just nailed down that corporations do not have FOURTH Amendment RIGHTS, but must DISH upon demand.

    reply to this | link to this | view in chronology ]

    • identicon
      Rocky, 15 Dec 2020 @ 12:38pm

      Re: Corporations are NOT persons with rights: gov't can DEMAND i

      Again, the first act of persons wishing to form a corporation is to ASK The Public for PERMISSION.

      Seems you don't like the constitution, especially the 1st Amendment:

      Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

      Considering everything else you have said, it seems you are a closet communist.

      reply to this | link to this | view in chronology ]

      • icon
        Ehud Gavron (profile), 15 Dec 2020 @ 2:58pm

        Closet communist

        Socialist - someone who believes the public good can be done by sharing resources. My definition; blame me if it's not what you think.

        Communist - a politically forced version of the above except there are the haves and have nots.

        There's no such thing as a "closet communist". That having been said the right of people to assemble has nothing to do with sharing resources. You can argue that preventing such an assembly by the government is a First Amendment violation... and you'd likely be right... but it has NOTHING to do with whether you are a democrat, republican, socialist, communist, libertarian, middle-of-the-road-ian, etc.

        Congress has made NO LAWS preventing peaceable assembly. End of story.

        E

        reply to this | link to this | view in chronology ]

  • This comment has been flagged by the community. Click here to show it
    identicon
    Faber Schnidejoch, 15 Dec 2020 @ 10:23am

    So your key assertion of "First Amendment rights" is hooey!

    "And, I think it's fairly important to state that these platforms have their own First Amendment rights, which allow them to deny service to anyone."

    https://www.techdirt.com/articles/20170825/01300738081/nazis-internet-policing-content -free-speech.shtml

    1A for corporations is statutorily granted privilege at best.

    THANKS, Maz. Takes a while, but you provide me with proof of all that I write.

    reply to this | link to this | view in chronology ]

    • This comment has been flagged by the community. Click here to show it
      identicon
      Faber Schnidejoch, 15 Dec 2020 @ 10:33am

      Re: So your key assertion of "First Amendment rights"

      Better clarify for hypothetical new readers (besides busy persons): neo-fascist Masnick asserts the above in connection with his wish that corporations have the power to control ALL speech on the Internet -- and especially that of political enemies. It's truly a KEY assertion for him, so when he handily points out above that corps don't have 4th Amendment rights against arbitrary search -- on demand -- then his 1A assertions necessarily collapse.

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 15 Dec 2020 @ 10:42am

        Re: Re: So your key assertion of "First Amendment rights&qu

        Why should the government control what speech goes on what website - and isn't that communism?

        reply to this | link to this | view in chronology ]

      • icon
        Bluegrass Geek (profile), 15 Dec 2020 @ 11:20am

        Re: Re: So your key assertion of "First Amendment rights&qu

        ... you do realize this is not a "search" as per the 4th Amendment, right? It's an order to give information, which hinges on the companies in question complying (or not). There aren't FTC agents going into offices & combing through file cabinets or server entries.

        The entire thrust of your argument falls apart because you don't understand what's happening here.

        reply to this | link to this | view in chronology ]

  • icon
    That One Guy (profile), 15 Dec 2020 @ 10:29am

    'Reviews of rather than by us are just such a pain...'

    The only plausible benefit to drawing the lines the Commission has is targeting a number of high profile companies and, by limiting the number to nine, avoiding the review process required under the Paperwork Reduction Act, which is not triggered if fewer than ten entities are subject to requests.

    Welp, there goes any credibility the thing might have had I'd say. If this was really an honest attempt to understand the industry then getting the idea reviewed shouldn't have been a problem, but by intentionally avoiding that it looks, at best, like a fishing expedition aimed at one or more companies while using the others as a smokescreen, if not simple harassment ordered from above as Glenn suggests.

    reply to this | link to this | view in chronology ]

  • icon
    Ehud Gavron (profile), 15 Dec 2020 @ 10:31am

    Dish upon demand

    Faber wrote that corporations must "dish upon demand."
    I have a question meant to elicit information, not disagreement:

    And yet, for a counter example and not for politics, the Trump Organization ("scheme") has yet to produce any of the documents sought by AUSAs and the SDNY and private citizens (alleging among other things rape).

    Why is it that one company can say "No, Shanks" to AUSAs, but other companies named above have to "dish upon demand" to the ENTIRELY INEFFECTUAL AND NEUTERED AND STUPID FTC?

    What recourse do these companies have to hire good (or unethical) lawyers and say "Aw hell no, Karen!"?

    E

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 15 Dec 2020 @ 12:52pm

    Nah just let them do this so when they get taken to court they can get beaten like a German running to Berlin because they never cared to see if they bothered to cover the flank😂

    I can already see where this is going.this is going to be a fiasco

    reply to this | link to this | view in chronology ]

  • icon
    ECA (profile), 15 Dec 2020 @ 1:16pm

    AND STILL,

    Who is responsible for Spam, on my Email as well as my Phone?
    Getting spam from Panama(??) and the Phone stuff is abit stupid, what is a 844 code? Insurance, car insurance, Medical, Social security, and a few others.

    WHO DO YOU CALL?
    Ghost busters went out of business.

    reply to this | link to this | view in chronology ]


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