New FTC report slams social media firms for harmful data use

YouTube, Amazon, Facebook, and other similar tech companies are failing to protect users from privacy intrusion and safeguard children and teens on their platforms, says the US Federal Trade Commission.

In a new staff report, the FTC accuses the companies of not “consistently prioritizing” users’ privacy. According to the agency, the firms also scoop up data en masse to power new AI tools and refuse to confront potential risks to kids.

The sprawling 129-page report is based on responses to orders issued back in December 2020 to nine companies – Amazon (the owner of the gaming platform Twitch), Facebook (now Meta), YouTube, Twitter (now X), Snap, ByteDance (the owner of TikTok), Discord, Reddit, and WhatsApp.

The orders asked for information about how the companies collect, track and use personal and demographic information, how they determine which ads and other content are shown to consumers, whether and how they apply algorithms or data analytics to personal and demographic information, and how their practices impact children and teens.

The conclusion is more than clear. “They engaged in vast surveillance of consumers in order to monetize their personal information while failing to adequately protect users online, especially children and teens,” says the report.

Lind Khan, the widely respected and feared FTC chair who manages to draw plaudits from liberals and conservatives alike, said the findings were obviously troubling.

“While lucrative for the companies, these surveillance practices can endanger people’s privacy, threaten their freedoms, and expose them to a host of harms, from identity theft to stalking. Several firms’ failure to adequately protect kids and teens online is especially troubling,” said Khan.

What’s more, the report found that the companies’ data collection and retention practices were “woefully inadequate.” Some firms did not delete all user data in response to user deletion requests.

The report recommends that the US Congress pass comprehensive federal privacy legislation.

There are troves of data being collected, of course, and the exposed users, the report points out, are usually left in the dark about how their data is used to make money for the companies.

According to the report, the investigation revealed “an inherent tension between business models that rely on the collection of user data and the protection of user privacy.”

Many of the companies analyzed “bury their heads in the sand when it comes to children.” They claimed that because their products were not directly targeted at children and their policies did not allow children on their sites, they knew nothing of children being present on them.

But “this is not credible,” noted the report. And indeed, there’s no age verification mechanism on most platforms, enabling underage users to simply lie about their age and freely use them. Moreover, teens seem to be treated like “traditional adult users.”

The report recommends that the US Congress pass comprehensive federal privacy legislation to cover all consumers and expand existing guardrails for children to apply to teens.