CDD

program areas Digital Consumer

  • Center for Digital Democracy, Center for Democracy & Technology, Consumer Action, Consumer Federation of America, Consumer Federation of California, Consumers Union, Electronic Privacy Information Center, National Association of Consumer Advocates, National Consumers League, Benton Foundation, Common Sense Kids Action, and Privacy Rights Clearinghouse file this brief to highlight the potential far-reaching ramifications of this case as well as the degree to which the panel decision breaks from century-long precedent, thereby creating a sharp split among the courts of appeals.First, the panel opinion raises issues of exceptional importance. If allowed to stand, the ruling could immunize from FTC oversight a vast swath of companies that engage to some degree in a common carrier activity. This result is unprecedented, deeply disruptive to the market, and at odds with Congress’s intent. Many of the world’s largest companies offer broadband Internet or other common carriage service. These highly diverse companies could harm consumers by committing acts that are deceptive or unfair, breach privacy commitments, fail to provide reasonable security for sensitive personal data, violate any of the seventy consumer protection statutes Congress has directed the FTC to enforce, or, as in the AT&T case, deliberately omit critical information about the services a company provides – and nonetheless escape FTC enforcement. No other federal agency has authority to fill this void.Second, the panel’s decision creates a deep Circuit split by breaking from the 100-year-long understanding that the term “common carrier” is defined by activities, not status. Departing from established norms of statutory construction, the panel failed to heed settled interpretive rules requiring that exemptions from antitrust laws be construed narrowly; that remedial statutes be read broadly to effectuate their purposes; and that an agency’s interpretation of its organic statute be accorded deference. The panel’s inversion of decades of precedent creates a substantial regulatory gap and puts the Ninth Circuit directly in conflict with the D.C. and Second Circuits.---For the full argument, see the attached PDF.
  • Blog

    need-to-know 1084

    AT&T: “cross-device connections allow AT&T to understand that a single user is accessing AT&T services from multiple devices, and to synchronize content and advertising messages across those devices....”We have data coming from 35 million set-top boxes...There’s a long list of people we partner with, like Experian, Acxiom, Kantar and Polk."

    excerpt from recent interview (link is external)with Rick Welday, president of AT&T AdWorks, 13 October 2016. ...AT&T is doubling down to understand the network effect of its merged mobile carrier and pay TV footprint. And it plans to up its investment in video programming by acquiring more of the content supply chain...Cross-screen targeting is also a big imperative. AT&T just completed a series of targeting pilots to measure the impact of addressable TV ads served to 14 million AT&T-DirecTV households and 30 million associated devices….AT&T has the opportunity to be the first fully integrated carrier in the United States. You’re taking a large MVPD, pay-TV provider and a scaled mobile and broadband business and bringing them together, and that’s unique. Today, we help advertisers place an ad based on interest or demographics in any one of 14 million households regardless of what they’re watching or when, whether it’s live or on playback. ...When the DirecTV merger completed, we had 12 million addressable households. We’re now [at] nearly 14 million. For us to have grown addressable households by 2 million shows our commitment. Out of those 14 million homes, we can identify about 30 million devices that are associated and help marketers identify their target audience across them without sharing personally identifiable information. Do you have a data management platform that would help you track consumer movement? We have data coming from 35 million set-top boxes, so we have incredible first-party data capabilities. We have to have a deep technical ability and transparency with our clients about where and when the ads get placed. Clients are more interested in making sure the ad gets to their targeted audience, but we still share information about the content and day part where the ad fired. Usually the client connects their data to a safe haven, where we’d [also include] our inventory and see where there’s overlap. Then we’d render the ads. There’s a long list of people we partner with, like Experian, Acxiom, Kantar and Polk. Where do you see the most opportunity for AT&T’s mobile data subscriber set? Will it, for instance, help close the loop between location, the in-store purchase and TV viewership? Right now we’re not using data from our mobile customers, but we’re well aware of the opportunity for them to consume more video solutions and advertising within our developing video services. We’re very excited about our ability to monetize through advertising within our mobile base. How that evolves, there’s nothing further we’d forecast or announce right now. Who is AT&T’s biggest competitor right now? Is it other telcos or are you keeping an eye on platforms with a large, logged-in user base like Facebook? There’s no question Facebook and Google are competitors. There is no shortage of options for advertisers. Everybody knows a lot of money is moving to the digital space. I think, for us, when we look at wwhere the growth is, it’s clearly going toward targeted, more audience-based advertising. Even in digital, growth is not riding on the backs of display or search advertising. It’s coming from mobile video. AT&T, having acquired DirecTV with the stated purpose of being an integrated carrier that specializes and leads and innovates in mobile video, that’s a good thing for us….When the DirecTV merger completed, we had 12 million addressable households. We’re now [at] nearly 14 million. For us to have grown addressable households by 2 million shows our commitment. Out of those 14 million homes, we can identify about 30 million devices that are associated and help marketers identify their target audience across them without sharing personally identifiable information. Excerpt 2: (link is external) The cross-device implications of an AT&T/Time Warner hookup are also clear: massive reach, distribution and data. It claims to have 141.8 million wireless customers in the US and Mexico, 15.6 million internet connections and 45.5 million video connections across DirecTV and U-verse. “It’s a significant audience, especially when you bring DirecTV into the mix, being able to use that data and that deterministic linking for more relevant messaging across all of those different sources, both owned-and-operated, and being able to take that outside of O&O across multiple channels and screen,” said Adelphic CEO Michael Collins. Both AT&T and Time Warner have deterministic user data across a wide array of channels. “They have it through DirecTV, they have it through AT&T’s ISP and AT&T’s television service and they have it through Time Warner’s wide distribution,” Collins said. “That’s sticky content and a very broad audience, and it’s all done on a deterministic basis, which makes it pretty powerful. I don’t know if you’d say it’s unique, but it’s certainly highly differentiated.” AT&T is already schooled in the ways of cross-device. Its privacy policy very clearly states that it uses both Tapad and Drawbridge “to establish connections between a user’s devices and to provide behavioral targeting across devices,” noting that “cross-device connections allow AT&T to understand that a single user is accessing AT&T services from multiple devices, and to synchronize content and advertising messages across those devices.” It’s only logical that AT&T will take its cross-device program to the next level with Time Warner on board. “One would have to imagine that Time Warner and AT&T are looking to bring content and distribution together for seamless distribution and content across screens,” Collins said. “But marketing and advertising are evolving as well, and the potential combination of Time Warner and AT&T would give them knowledge, insight and the ability to deliver highly relevant advertising on behalf of advertisers.”
  • Blog

    CDD Statement on AT&T/Time Warner Deal

    "Big Data" driven merger raises threats to consumers, subscribers and competitors as mega-giant will gather our data from PCs, mobile devices and TVs

    This proposed deal raises major challenges for consumers, subscribers and competitors. It reflects the “Big Data” and digitally data-driven imperatives that are reshaping the U.S. media system. Giant broadband ISP networks, such as AT&Ts, and content providers as Time Warner, want to join together to both deliver programming and continually gather a host of information about each and every consumer. A new stranglehold is being placed on our communications landscape, as already dominant cable and telephone monopolies devour former partners or competitors (Verizon/AOL/and now Yahoo!, for example). This is all about tracking and targeting us regardless of whether we use a mobile device, PC or TV. Through the growing capability of mobile phones to follow and geo-target us everywhere we go—the supermarket, while in a car, or even on the street, these new broadband ISP/mobile/TV giants are extending their powerful digital tentacles further into our lives. While some programmers and large advertisers will benefit, the deal raises a host of consumer concerns, including about privacy. It’s no surprise that AT&T is bitterly opposed to the privacy safeguards up for a vote this coming Thursday at the FCC. They don’t want any potential new rules that empower consumers to control what they hope will be a massive influx of data they plan to monetize. Today’s announcement underscores why the FCC should pass Chairman Wheeler’s plan. Antitrust and consumer protection regulators must use a 21st Century framework that ensures that the public has a fair, diverse and equitable digital media system. Those companies that control our data--as well as the devices and applications we rely on (especially mobile)--will be formidable gatekeepers. They will be able to influence the content and communications we both receive and send. It's not to far out to see the next deal be Google/Comcast or AT&T/Time Warner/Facebook. AT&T's recent buying spree, including DirecTV (link is external), gives it a formidable cross-screen presence. As one of the handful of dominant broadband Internet Service Providers, it provides critical network connections to millions of Americans, as well as multichannel video service. It is investing to expand this empire, including video streaming (link is external) and the Internet of Things (link is external). Now it will have both Big Data and Bug Bunny, as well as HBO, CNN and a myrid of other properties. All to lure us to sit back, subscribe, view, interact with the ads on all our devices, engage with branded experiences and--yes--for this even bigger digital giant to gather and sell off our data on behalf of big brands and vested interests. statement of Jeff Chester, executive director
    Jeff Chester
  • Blog

    need-to-know 1082

    Turner Broadcasting Aligns with Epsilon, Krux and Oracle to Power New Turner Data Cloud and Turner Premium Marketplace

    Turner Broadcasting [Time Warner] (link is external) is partnering with Epsilon, Krux and Oracle to enable advertisers and their agencies to connect to the Turner Data Cloud (TDC), the company’s advanced data management platform (DMP) originally announced at the company’s Upfront last month. Through these advanced third-party targeting capabilities along with Turner’s own proprietary data sources, TDC will aggregate and analyze first-and third-party data to provide advertisers, agencies and Turner itself more effective methods to reach and engage target audiences. “We are joining forces with industry-leading data and technology companies to power the Turner Premium Marketplace powered by an unrivaled central repository of data,” said Stephano Kim, Chief Data Strategist, Turner Broadcasting. “Fueling multi-screen ecosystems, Turner Premium Marketplace will enable our sales divisions to take their client conversations to a new level of insight and strategy to more effectively execute advertising campaigns across Turner’s portfolio. Brands advertising on Turner properties now have the enhanced ability to reach the most appropriate and desirable audiences across all user experiences wrapped in our premium content.” The Turner Premium Marketplace includes both digital and linear advertising campaigns across the company’s portfolio of entertainment, news, sports and kids brands. Advertisers and their agencies can choose to transact directly and programmatically depending on their unique campaign goals and business objectives. Through the Turner Data Cloud, advertisers can harness the power of their first party data in addition to third party data to effectively engage consumers and reach the right audience across Turner – a portfolio spanning television, digital and mobile platforms that reaches approximately 75% of all Americans. In addition to providing stronger advertising solutions, TDC will allow for better personalized consumer experiences across Turner’s own multiscreen brand destinations. “Turner Broadcasting is at the forefront of the evolution of content distribution,” said Andy Frawley, chief executive officer of Epsilon. “To enable the strongest possible brand experience for a consumer, it is imperative to leverage the power and value of data to drive marketing, advertising and programming to better connect the consumer’s experience and engagement. We look forward to leveraging our full suite of Big Data capabilities to support the Turner Data Cloud.” "The Turner Data Cloud is another industry-leading move by Turner, and we're proud that Krux's real-time DMP is at the center of this solution,” said Krux CEO Tom Chavez. "Through Krux, Turner is unifying people data across all channels and employing unparalleled identity management to activate highly specific audiences across linear and digital campaigns. What’s more, with Krux’s iterative learning capabilities, Turner advertisers can apply real-time campaign optimizations to drive higher conversions.” "Oracle Data Cloud is thrilled to collaborate with Turner to help their clients understand more about consumers based on what they do, say, and buy, enabling them to personalize and measure every customer interaction in order to maximize the value of their digital marketing,” said Omar Tawakol, GM of Oracle Data Cloud. "Our relationship with Turner will allow their clients to spend confidently knowing that their ads can be reliably delivered to the right consumer across screens." About Epsilon and Alliance Data About Epsilon Epsilon is the global leader in creating connections between people and brands. An all-encompassing global marketing company, we harness the power of rich data, groundbreaking technologies, engaging creative and transformative ideas to get the results our clients require. Recognized by Ad Age as the #1 World CRM/Direct Marketing Network, #1 U.S. Digital Agency Network and #1 U.S. Agency from All Disciplines, Epsilon employs over 7,000 associates in 70 offices worldwide. Epsilon is an Alliance Data (link is external) company. For more information, visit www.epsilon.com (link is external), follow us on Twitter @ (link is external)EpsilonMktg (link is external) or call 1.800.309.0505. About Alliance Data Alliance Data (link is external)® (NYSE: ADS) is a leading global provider of data-driven marketing and loyalty solutions serving large, consumer-based industries. The Company creates and deploys customized solutions, enhancing the critical customer marketing experience; the result is measurably changing consumer behavior while driving business growth and profitability for some of today's most recognizable brands. Alliance Data helps its clients create and increase customer loyalty through solutions that engage millions of customers each day across multiple touch points using traditional, digital, mobile and emerging technologies. An S&P 500 company headquartered in Plano, Texas, Alliance Data consists of three businesses that together employ more than 15,000 associates at approximately 100 locations worldwide. Alliance Data’s Card Services (link is external) business is a leading provider of marketing-driven branded credit card programs. Epsilon (link is external)® is a leading provider of multichannel, data-driven technologies and marketing services, and also includes Conversant (link is external), the leader in personalized digital marketing. LoyaltyOne (link is external)® owns and operates the AIR MILES (link is external)® Reward Program, Canada's premier coalition loyalty program, and holds a majority interest in Netherlands-based BrandLoyalty (link is external), a global provider of tailor-made loyalty programs for grocers.
  • News

    Federal Trade Commission Must Stop “Influencer” Marketing Targeting Kids on YouTube and Other Digital Sites

    Complaint Filed Against Unfair and Deceptive Practices Used by Google, Disney’s Maker Studios, DreamWorks-Owned AwesomenessTV, and Other Companies, by Leading Advocacy Groups

    The Center for Digital Democracy (CDD), Campaign for a Commercial-Free Childhood (CCFC) and Public Citizen filed a complaint at the Federal Trade Commission (FTC) today asking for an investigation and enforcement action against Google (a subsidiary of Alphabet, Inc.), Disney’s Maker Studios, DreamWorks-owned AwesomenessTV, and two other companies for the unfair and deceptive practice of targeting “influencer” marketing toward children. The complaint documents how several marketing companies—Collab Creators, Wild Brain, Maker Studios, and AwesomenessTV—produce and distribute ads and other commercial material targeting children that masquerade as content. It also details how Google encourages and benefits from the production of child-directed influencer videos and distributes these ads to children on its YouTube and YouTube Kids platforms. These “influencer” ads take unfair advantage of kids, who do not have the ability to recognize that companies use social media and YouTube celebrities to pitch toys, junk food, and other products. The groups also called on the FTC to release policy guidance that makes clear that using influencers to persuade children to buy a product or urge their parents to buy a product is unfair and deceptive. “Child-directed influencer marketing is misleading to children because their developing brains do not process or understand advertisements the way adults do—especially advertisements disguised as content,” said Laura Moy, Director at the Institute for Public Representation (IPR) at Georgetown University Law Center, which represents the groups. Existing FTC regulations require that advertisements be disclosed as such—which many influencer ads fail to do—but the complaint also makes clear that better disclosure alone is not a sufficient remedy because it “would not negate the inherent deceptiveness of child-directed influencer marketing.” As a result of the FTC’s inaction, marketing companies—backed by Google and others—are increasing investments in their influencer marketing practices with harmful results. “In many cases these advertisements cause children to want unhealthy and costly products,” Moy pointed out. “As this marketing practice expands even while evidence mounts that it is harmful to children, it becomes increasingly urgent for the FTC to make clear that the practice is unfair and deceptive under the law.” According to the complaint, the FTC can reverse the trend of harmful influencer marketing directed toward children by issuing policy guidance that makes clear that existing laws serve as a safeguard to protect children from these advertisements. The complaint analyzes the influencer marketing apparatus, and the role that Google and so-called Multi-Channel Networks (MCNs) such as Disney’s Maker Studios play in orchestrating the growing use of this tactic. It highlights how these companies use “influencers” who are young or popular with kids to sell junk food, toys, and more. The complaint identifies highly-popular YouTube channels like EvanTubeHD, Baby Ariel, Meghan McCarthy, the Eh Bee Family, and Bratayley, each with millions of subscribers, and how they present videos of child stars unboxing toys, playing games, and enthusiastically sampling junk food. The complaint provides several examples of such videos, including one where Baby Ariel and her family sample Jelly Belly brand jelly beans as part of a game called “BeanBoozled.” In another video, on EvanTubeHD, the child influencer is seen unboxing a Lego Police Patrol Boat. Neither video indicates that it is an advertisement, and both videos can be found intermingled with non-sponsored content on YouTube Kids. Google facilitates, promotes, and solicits these videos because they are popular with children, which increases the company’s ad revenues. “It’s time for the FTC put a stop to child-directed influencer marketing,” explained CDD’s Executive Director Jeff Chester. “Companies like Google are knowingly taking advantage of children and their parents by unleashing a torrent of stealth digital ads disguised as programming supposedly suitable for kids. As the country’s leading consumer protection agency, the FTC has a mandate to protect the public—including our children—from practices we know are both unfair and deceptive.” “Parents have no idea that the adorable ‘friends’ their children like to watch unbox toys are really stealth marketers,” said CCFC’s Executive Director Josh Golin. “It’s time for the FTC to take swift and decisive action and protect children from a practice that has long been prohibited on children’s television.” “Corporate predators are using young Internet influencers, admired by kids, to hawk their wares to children, even to young children,” explained President of Public Citizen, Rob Weissman. “The marketers and the advertising platforms enabling and promoting this activity should be ashamed. But since they’re not, we need the FTC to act to end their outrageous practice.” CCFC and CDD have also previously filed complaints with the FTC concerning child-directed marketing practices on YouTube Kids and YouTube. Todays’ complaint can be found at: http://www.commercialfreechildhood.org/sites/default/files/FTCInfluencerComplaint.pdf (link is external)
  • Cross-Device Privacy Must be Protected by FCC Proposed Rule on Broadband ISPs

    Geolocation & Cross Platform and Application Data is Sensitive information. AT&T expands cross-device targeting

    ... ISPs are engaged in cross-device tracking of its subscribers and customers which allow them to target advertising at the individual and household level. Exemplary for all ISPs, we are highlighting AT&T’s efforts in this area. AT&T is expanding its cross-device tracking in order to target individuals on their mobile device after collecting and analyzing their data using the company's internal data and analytics capabilities. In a recent interview, AT&T AdWorks President Rick Welday explained that by the end of this year AT&T will allow marketers to “advertise in 14 million addressable households, 30 million mobile devices and millions of streams within the DirecTV app.” While AT&T may claim that its cross-device tracking is done “anonymously,” that is merely a euphemism to obscure the invasion of privacy that underlies such practices. Mr. Welday explains that AT&T’s data-driven monitoring of its customers enables it to develop dossiers that reveal whether their users are a new homeowner, a new parent, or in the market for an automobile. In its trials with cross-device targeting, AT&T worked with leading Fortune 100 brands as well as promoting its own “AT&T Mobility Wireless” service. The Fortune 100 companies that AT&T worked with likely provided their own so-called first-party data to be used for such cross-device targeting. This illustrates the operational realities today for consumer profiling data, where data are no longer shared with advertisers, but rather advertisers provide such data to ad-delivery platforms (such as AT&T's) for increasingly granular targeting.[3] Linking devices (and the application history on and geolocation on of those devices) to a particular consumer via a unique identifier should be prohibited, unless the ISP has obtained affirmative, express consent (opt-in). The rule’s definition of ‘sensitive information’ must therefore reflect industry practices and include any data elements that allow for this kind of cross-device tracking. The final rule must give ISP customers control over their data, and before companies can proceed with targeted advertising, they must obtain an opt-in consent from their customers. We are particularly concerned that without such safeguards the rules would allow for a by-passing of requirements of the Children’s Online Privacy Protection Act, by using insights gained via cross device tracking to target children without parental consent. Finally, we urge the Commission to affirm in its final rule the need for safeguards against any unauthorized attempts to re-link devices (and its app usage history and geolocation information) to associate them with one user. CDD respectfully urges the FCC to enact its proposed safeguards as soon as possible to help address the further eroding of Americans’ privacy by ISPs.
  • Blog

    CDD Welcomes FCC Chairman Wheeler’s Broadband Privacy Proposal

    Provides Key New Safeguards for ISP Customers’ Privacy

    Washington, DC: Federal Communications Commission Chairman Tom Wheeler announced today (link is external) that he is circulating a broadband ISP privacy proposal to the other four FCC Commissioners detailing a plan that would provide individuals with key safeguards regarding their data. The proposal is designed to help implement the FCC “Open Internet” order to ensure that ISPs respect the privacy of communications over broadband and mobile networks. The following can be attributed to Katharina Kopp, Deputy Director, Center for Digital Democracy: We laud the timely development of a rule that would require ISP customer permission before much of their personal information may be used or shared. This proposal offers consumers the much needed safeguards and desired control over their own personal information. For the first time, ISPs would have to obtain customer consent for the use of web browsing and app usage history for advertising purposes. Given the unique position of ISPs as gatekeepers to vast amounts of customer data, the FCC’s proposed broadband privacy rule is a critical step in preserving a free and open Internet into the 21st century. Because we know that ISPs’ big data analytical capabilities can turn seemingly non-sensitive information into highly private information about our lives, and because all our browsing data and the content of our communications is incredibly sensitive to begin with, we had asked the FCC to avoid drawing distinctions between “sensitive” and “non-sensitive” categories of information. Still, we believe that the proposal’s framework can work for consumer privacy provided the FCC’s definition of “sensitive” is robust and meaningful. We will work to ensure this proposal is effectively implemented and that ISP broadband consumers receive the privacy protections they deserve. The Center for Digital Democracy is a leading nonprofit organization focused on empowering and protecting the rights of the public in the digital era.
  • Blog

    Introducing Salesforce Einstein–AI for Everyone

    Artificial Intelligence Uses Big Data for 1:1 consumer targeting/Privacy & Consumer Protection?

    Apple’s Siri analyzes thousands of movie showings and surfaces recommendations for the best times and theaters based on my location within seconds. Spotify knows my music preferences and curates personalized playlists for me. Facebook instantly recognizes my friends in photos and suggests tags with nearly 98 percent accuracy (link is external). All of this is made possible by artificial intelligence (AI)–complex and highly technical solutions such as natural language processing, deep learning and machine learning that when applied to everyday actions in our personal lives make us smarter and more productive. Today, Salesforce is delivering Salesforce Einstein–artificial intelligence for everyone. For many companies, the technical expertise, infrastructure and other resources required to deliver AI solutions is too significant to leverage in their enterprise applications. But in keeping with Albert Einstein's dictum that the definition of genius is taking the complex and making it simple, Salesforce Einstein is removing the complexity of AI, enabling any company to deliver smarter, personalized and more predictive customer experiences. Salesforce Einstein is a set of best-in-class platform services that bring advanced AI capabilities into the core of the Customer Success Platform, making Salesforce the world’s smartest CRM. Powered by advanced machine learning, deep learning, predictive analytics, natural language processing and smart data discovery, Einstein’s models will be automatically customized for every single customer, and it will learn, self-tune, and get smarter with every interaction and additional piece of data. Most importantly, Einstein’s intelligence will be embedded within the context of business, automatically discovering relevant insights, predicting future behavior, proactively recommending best next actions and even automating tasks. With Einstein, the world’s #1 CRM is now the world’s smartest CRM and we’re bringing intelligence to all of our clouds. But don’t take my word for it. See below to hear from our Cloud GMs about what Einstein (link is external)means for all our clouds. Sales Cloud Einstein (link is external) Service Cloud Einstein (link is external) Marketing and Analytics Cloud Einstein (link is external) Community Cloud Einstein (link is external) IoT Cloud Einstein (link is external) App Cloud Einstein (link is external) We couldn’t be more excited to finally unveil Salesforce Einstein after two years of hard work and targeted acquisitions. As we continue to build out AI for CRM, we are committed to understanding the next generation of AI technology and how it can best be applied to Salesforce. This effort will be led by Salesforce Research, a new research group focused on the future of AI, under the leadership of Dr. Richard Socher, our Chief Scientist.
  • Electronic Privacy Information Center & CDD Defend Privacy Rights of WhatsApp Users

    WhatsApp plan to transfer user data to Facebook is unlawful, groups tell Federal Trade Commission (FTC)

    Washington, DC (August 29, 2016) – The Electronic Privacy Information Center (EPIC) and the Center for Digital Democracy (CDD) today filed a complaint with the Federal Trade Commission, stating that the WhatsApp plan to transfer user data to Facebook is unlawful and that the FTC is obligated to block the proposed change in business practices. The EPIC-CDD complaint responds to a recent announcement from WhatsApp that the company plans to disclose the verified telephone numbers of WhatsApp users to Facebook for user profiling and targeted advertising. “When Facebook acquired WhatsApp, WhatsApp made a commitment to its users, to the Federal Trade Commission, and to privacy authorities around the world not to disclose user data to Facebook. Now they have broken that commitment,” said Marc Rotenberg, President of EPIC. “Clearly, the Federal Trade Commission must act. The edifice of Internet privacy is built on the FTC’s authority to go after companies that break their privacy promises.” Facebook and WhatsApp are the two largest social network services in the world. According to Wikipedia, WhatsApp has over one billion users. Facebook purchased the company in February 2014 for 19.3 billion dollars. EPIC Consumer Protection Counsel Claire Gartland explained, “In 2014, the FTC said that WhatsApp had to obtain affirmative consent to transfer user data to Facebook. There was an opt-out provision but that only applied to new information. Since WhatsApp intends to transfer user telephone numbers, which is not new data, it must obtain opt-in consent.” Gartland continued, “The phone number may also be the single most valuable piece of personal data obtained by WhatsApp. WhatsApp users are required to provide a verified phone number to use the service. And the phone number provides a link to a vast amount of personal information.” “The proposed change – an opt-out for data previously obtained – is exactly what the FTC said WhatsApp could not do,” said Gartland. “The transfer is only allowed if the consent is opt-in.” “The FTC has an obligation to protect WhatsApp users. Their personal information should not be incorporated into Facebook’s sophisticated data driven marketing business,” said Katharina Kopp, Ph.D., and CDD’s Director of Policy. “Data that was collected under clear rules should not be used in violation of the privacy promises that WhatsApp made. That is a significant change that requires an opt-in, according to the terms the FTC set out. It’s not complicated. If WhatsApp wants to transfer user data to Facebook, it has to obtain the user’s affirmative consent.” In 2011, EPIC, CDD and more than a dozen consumer privacy organizations pursued a successful complaint at the FTC that led to a twenty-year consent order after Facebook changed user privacy settings in a way that made users' personal information, such as Friend lists and application usage data, more widely available to the public and to Facebook’s business partners. Former FTC Chair John Liebowitz said at the time, “Facebook is obligated to keep the promises about privacy that it makes to its hundreds of millions of users. Facebook's innovation does not have to come at the expense of consumer privacy. The FTC action will ensure it will not." When Facebook proposed to acquire WhatsApp in 2014, EPIC and CDD said the FTC must protect the privacy of WhatsApp users. The FTC said that WhatsApp must continue to honor its privacy promises to consumers. The FTC warned, “If the acquisition is completed and WhatsApp fails to honor these promises, both companies could be in violation of Section 5 of the Federal Trade Commission (FTC) Act and, potentially, the FTC's order against Facebook.” The Federal Trade Commission has previously undertaken investigations against many firms that have engaged in unfair or deceptive trade practices. The Electronic Privacy Information Center (EPIC) (link is external) is a public interest research center in Washington, DC. EPIC was established in 1994 to focus public attention on emerging privacy and civil liberties issues and to protect privacy, freedom of expression, and democratic values in the information age. EPIC maintains one of the most popular privacy web sites in the world - epic.org (link is external) - and pursues a wide range of program activities including policy research, public education, litigation, publications, and advocacy. The Center for Digital Democracy (CDD) is recognized as one of the leading consumer protection and privacy organizations in the United States. Since its founding in 2001 (and prior to that through its predecessor organization, the Center for Media Education), CDD has been at the forefront of research, public education, and advocacy protecting consumers in the digital age. REFERENCES EPIC/CDD, In the Matter of WhatsApp: Complaint, Request for Investigation, Injunction, and Other Relief (Aug. 29, 2016), https://epic.org/privacy/ftc/whatsapp/EPIC-CDD-FTC-WhatsApp-Complaint-20... (link is external) FTC, “Enforcing Privacy Promises” (2016), https://www.ftc.gov/news-events/media-resources/protecting-consumer-priv... (link is external) FTC Press Release, “FTC Notifies Facebook, WhatsApp of Privacy Obligations in Light of Proposed Acquisition” (Apr. 10, 2014), https://www.ftc.gov/news-events/press-releases/2014/04/ftc-notifies-face... (link is external) FTC Letter to FB and WhatsApp, "Letter From Jessica L. Rich, Director of the Federal Trade Commission Bureau of Consumer Protection, to Erin Egan, Chief Privacy Officer, Facebook, and to Anne Hoge, General Counsel, WhatsApp Inc.” (Apr. 10, 2014), https://www.ftc.gov/news-events/press-releases/2014/04/ftc-notifies-face... (link is external) FTC, "Facebook Settles FTC Charges That It Deceived Consumers By Failing To Keep Privacy Promises” (2011), https://www.ftc.gov/news-events/press-releases/2011/11/facebook-settles-... (link is external) FTC Consent Order with FB (2011), https://www.ftc.gov/news-events/press-releases/2012/08/ftc-approves-fina... (link is external) EPIC, In re WhatsApp, https://epic.org/privacy/internet/ftc/whatsapp/ (link is external) EPIC, In re Facebook, https://epic.org/privacy/inrefacebook/ (link is external) ###
  • Blog

    DoJ and FCC Regulators Must Scrutinize Verizon/Yahoo deal

    Need 21st Century Safeguards for Big-Data-driven digital media mergers

    Statement of Jeff Chester, CDD executive director: Regulators, including the DOJ and FCC, must prevent Verizon from taking anticompetitive and unfair advantage of its broadband ISP bird’s nest view of what their subscribers and consumers do—online and off. The proposed takeover of Yahoo’s core digital data advertising business, when combined with the capability to gather information from its wireless devices, broadband networks, and set-top boxes, gives it control over the key screens that Americans use today. Verizon has already supercharged its use of “Big Data” tactics to monitor their customers and online users, including through its recent shopping spree that includes AOL and Millennial Media (and also enables it to manage part of Microsoft Advertising’s consumer data targeting operations). Verizon’s ability to track a single person across their devices, when they are in a store, at home, work or school, and connect the digital dots to know whether they are now on their mobile phone or home watching TV, is a threat to the privacy of Americans. Regulators should closely scrutinize the Yahoo dea to prevent anticompetitive practices related to Verizon’s ability to leverage its mobile and geo-location consumer data. The FCC should also impose strict safeguards that prevent Verizon from combining Yahoo data with what it already knows about its customers and consumers. The FCC should also quickly enact its proposed consumer privacy rules for broadband ISPs. As broadband network monopolies such as Verizon merge online ad giants, new threats to consumer privacy emerge. That’s why action of FCC Chairman Wheeler’s privacy proposal is required. The Obama Administration and the FCC must ensure that deals like Verizon/Yahoo don’t further erode the little privacy Americans enjoy today when they use digital media. **** For background on Verizon’s use of data, see the section in our recent report: https://www.democraticmedia.org/article/big-data-watching-growing-digita... also, to see Verizon’s recent growing capabilities to use our geo-location and app data, note from Millennial Media 10 k 2015 (that company now owned by Verizon) My bold: Our robust data management platform, or DMP, allows us to access, analyze and utilize the large volumes of data we possess. This data includes location, social, interest, and contextual data, as well as the insights we derive from measuring campaign effectiveness—providing a unique, multidimensional profile of individual consumers. To date, we have developed more than 700 million active server‑side unique user profiles, over 60 million of which link multiple mobile devices and PCs to a single specific user on an anonymous basis. These user profiles, combined with third party data from our data partners, enable us to deliver more relevant, engaging and effective advertising to our advertising clients. Our data asset also allows us to measure the impact of mobile advertising on consumer engagement, intent and action. We have developed a suite of solutions which measures several different areas of mobile advertising impact. As of December 31, 2014, our platform reached more than 650 million monthly unique users worldwide, including over 175 million monthly unique users in the United States alone. Approximately 60,000 apps and mobile sites are enabled by their developers to receive ads delivered through our platform, and we can deliver ads on over 9,000 different mobile device types and models. While averaging more than three billion ad requests daily throughout 2014, in the last two months of 2014, our platform typically handled over nine billion ad requests daily, including requests received through our supply side tool, and requests received through third party platforms and processed by our programmatic buying tool.