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Big tech faces competition and privacy concerns in Brussels

March 25, 2019

And the sector may be the better for it
Print edition | Briefing
Mar 23rd 2019 | PARIS
Around 19 in every 20 European internet searches are carried out on Google. Not those done by Margrethe Vestager. The European Union’s competition chief says she mostly looks stuff up on Qwant, which prides itself on not tracking users in the manner its larger rival does. Forget also Google Maps, or Gmail, or any other product from the Alphabet stable: “I have better alternatives that provide me with more privacy,” the Danish politician recently told a crowd at sxsw, an annual festival of tech, music and thought in Austin, Texas.

Ms Vestager is hardly at the vanguard of a movement: even in its domestic French market, Qwant has less than 1% market share. Nor, at first, might her focus on privacy seem linked to her trustbusting brief. But, as she has explained, popular services like Facebook use their customers as part of the “production machinery”. You may not pay in cash to like a friend’s pictures, or every time you ask Alexa what a “cup” of butter is in grams—but you might as well do, given how much personal data you have to fork over. Rather melodramatically, Ms Vestager says what seem to be free services are ones for which you “pay with your life”.

Those appointed, by governments or themselves, to worry about competition have a strong interest in big tech firms such as Google and its parent Alphabet, Apple, Amazon and Facebook. How could they not, given how quickly those firms have come to dominate the business landscape. On both sides of the Atlantic, the reputation that big-tech companies other than Apple have for making free with people’s data has led to rules being tightened, and there is talk of tightening them more. There are other concerns, too. Europeans have a fairly strong feeling that the firms do not pay enough tax. Everywhere there are worries about the content which they spread—such as, for a while, video of the massacre in Christchurch—and that which they are thought to suppress.

Tech groups have hordes of lobbyists experienced in weathering these various issues. Occasional losses—such as the €1.5bn ($1.7bn) that Google was fined on March 20th for abusing its clout in the online-advertising market—can to some extent just be treated as a cost of doing business. What they are not so well prepared for is the crossing of some of these streams of complaint. European regulators are bringing together concerns about privacy and rules about competition to create constraints that could up-end the way companies do business online.

Common market power
Campaigners have long lamented that, although the users of online platforms tell pollsters that they care about privacy, they do not act as if they do. If privacy becomes tied to antitrust concerns, though, users do not need to care. They merely need to be content that regulators armed with big sticks—European regulators are empowered to levy fines on companies operating in Europe that are a significant fraction of their global revenue—should care on their behalf. Ms Vestager and her colleagues seem happy to do the honours.

The premise for bringing together concerns about privacy and competition is that the tight grip which big tech companies have over user data is what has turned them into entrenched, and perhaps abusive, incumbents. As Andreas Mundt, head of Germany’s competition watchdog, the Bundeskartellamt, puts it, “Europe says…that data can provide market power.” In February, his agency startled technology companies and those who analyse them with a ruling against Facebook built on such an analysis. In a 300-page finding it argued that Facebook was only able to gather so much data because of its dominant position amid social networks.

The measure of market power usually used to justify action on competition grounds is, roughly speaking, that a company is able to raise prices without losing customers. Such an ability suggests that the level of competition in the market needs at least looking into, and perhaps redressing. Facebook, being free to its public users (though not to the advertisers who buy the users’ attention), cannot have its market power analysed in this way. But Mr Mundt says that the company’s ability to encroach ever more on its users’ privacy without seeing them leave—for example, by starting to track them while they browse sites not connected to Facebook—is also a measure of market power.

This analysis is leading to strict new rules on the amount of data Facebook can collect from German users. It can no longer mesh together the data it gathers from its various services, including WhatsApp and Instagram, as it has said it wants to do. There are also restrictions on how much it can track its users when they browse the internet beyond Facebook. Mr Mundt compares these new constraints on the flow of information inside the company to Facebook being “internally broken up”.

The logical step beyond limiting the accrual of data is demanding their disbursement. If tech companies are dominant by virtue of their data troves, competition authorities working with privacy regulators may feel justified in demanding they share those data, either with the people who generate them or with other companies in the market. That could whittle away a big chunk of what makes big tech so valuable, both because Europe is a large market, and because regulators elsewhere may see Europe’s actions as a model to copy. It could also open up new paths to innovation.

Europe is not an impressive performer when it comes to creating tech behemoths. It is as well represented among big global tech companies as companies other than Google are in search-engine statistics: there is just one (sap, a business software company) in the top 20. Look at the top 200 internet companies and things are, if anything, a touch worse; just eight. But in regulatory heft the eu punches far above its members’ business weight.

There are various ways of explaining this. One is that Europe’s keenness to regulate stops its tech firms from growing in the way that hands-off America encourages. Another is that the rigours of its zealous regulation are experienced, in the main, only by foreigners—which makes them more palatable to, or even popular with, politicians and the public. “Would Brussels be so tough on big tech companies if they were French or German?” asks one American executive, rhetorically.

There is also the consideration that the companies potentially “disrupted” by internet innovators include European carmakers, telecoms companies and media groups, about whom European politicians care a lot. New copyright regulations being voted on by the European Parliament next week have been widely criticised for putting the interests of copyright holders, which largely means media companies, far ahead of the interests of online companies and, indeed, the free expression of users.

Regardless of motive, though, this is now the way of the world. A look at the annual reports of big tech companies clearly shows that they have a lot of European issues to face, including taxes (see chart 1). And this means that differences between the ways in which Europeans and Americans think about competition and privacy matter a lot.

Brussels rules
Take competition first. Much of the underlying law governing cartels, mergers and competition is quite similar on both sides of the Atlantic. But the continents’ approaches to handling big companies are leagues apart.

In recent decades, American antitrust policy has been dominated by free-marketeers of the so-called Chicago School, deeply sceptical of the government’s role in any but the most egregious cases. Dominant firms are frequently left unmolested in the belief they will soon lose their perch anyway: remember MySpace? The lure of fat profits is, after all, what motivates firms to innovate in the first place. While there is healthy academic debate over whether online businesses naturally, or even inevitably, have a tendency towards monopoly, it has yet to have much effect on regulation. American courts view dominant firms as a problem only if their position does clear harm to consumers.

By contrast, “Europe is philosophically more sceptical of firms that have market power,” says Cristina Caffarra at Charles River Associates, an economics consultancy. Its regulators want to see competitors that have been less successful continue to exist, and even thrive. Competition is seen as valuable in and of itself, to ensure innovation happens beyond one firm that has conquered the market.

“The debate on whether there has been underenforcement of antitrust is far more dynamic in Europe—there is a sense of urgency,” says Isabelle de Silva, head of France’s competition authority. Germany and Austria have changed laws to allow them to scrutinise takeovers of startups, in the belief tech incumbents are taking out future rivals before they have time to hatch into real competitors. Alphabet, Amazon, Apple, Facebook and Microsoft have together taken over a company per week for the past five years.

There is not just more interest in regulating big tech in Europe; there is also more power to do so. William Kovacic, a former boss of the Federal Trade Commission in America, said recently that Brussels is “the capital of the world” for antitrust, leaving its American counterparts “in the shade”. American antitrust typically involves prosecuting the case in front of a judge. The European Commission can decide and impose fines by itself, without the approval of national governments, though the decisions are subject to appeal in the courts. And whereas, in America, only federal agencies can apply federal law, European antitrust law can be applied both by national authorities and the commission.

Every major tech group has had run-ins with European antitrust rules. Since 2017, Google has been sanctioned three times, running up €8.2bn in fines for promoting its own shopping-comparison service in search results and edging out rivals with its Android phone software, as well as for abusing its strength in advertising. It is appealing the decisions. In 2017 Facebook was fined €110m for misinforming the eu about its plans for integrating WhatsApp with its flagship social network.

In the same year Amazon was rebuked for the way it sold e-books, agreeing to change its practices. It is now under an early-stage investigation both in Germany and Europe-wide for the way it uses sales data from its “Marketplace” platform to compete with the independent retailers who sell through it. On March 13th Spotify, a Swedish music-streaming service, demanded that the commission step in to stop Apple levying hefty fees from those who sell services through its App Store.

Then there is privacy. In the past century almost all European countries have experienced dictatorship, either home-grown or imposed through occupation, which has raised sensitivities. “Privacy is a fundamental right at eu level, in a way that it is not in America,” says Andrea Renda of the Centre for European Policy Studies, a think-tank. That right is enshrined in the eu Charter of Fundamental Rights in the same way that free speech is protected by America’s constitution. Polls show Europeans, and particularly Germans, to be more concerned about the use of their personal data by private companies than Americans are.

When American tech companies first encountered these concerns they were relatively trifling. In 2010 German authorities demanded Google blur the homes of anyone who objected to appearing in its Street View service. (Rural Germany remains one of the last places where well-off people live beyond the service’s coverage.) Four years later, an eu-wide “right to be forgotten” provided some circumstances in which citizens could expunge stories about them from search results.

The General Data Protection Regulation (gdpr), which came into force last May, raised the issue to a new level. Beyond harmonising data protection across Europe, it also established a principle that individuals should be able to choose how the information about them is used. This is an issue not just for the companies which currently dominate the online world—the provisions of the gdpr were central to the German ruling on Facebook—but also for that world’s basic business model.

The data about their users collected by apps and browsers is the bedrock of online advertising—a business which in 2018 was worth $108bn in America according to eMarketer, a consultancy. The most valuable part of the industry works by selling the user’s attention to the highest bidder, a simple-sounding proposition which requires a labyrinthine and potentially leaky “adtech” infrastructure.

Enterprises called “supply-side platforms” use data from apps and from cookies in browsers to pass a profile of every person who visits an advertising-supported page to an advertising exchange. There the rights to show adverts are auctioned off user by user. Bidders use the data from the supply-side, along with further data procured from brokers, to decide how likely the user is to act on their ad, and thus how much it is worth to show it to him. The highest bidder gets to put its ad on the user’s screen (see chart 2). Meanwhile, data associated with the transaction are used to update the brokers’ records.

The more pertinent data the bidders get, the more the winning advertiser is likely to bid. This builds in incentives to get as much data to as many bidders as feasible. And that is not particularly conducive to the protection of privacy.

The introduction of the gdpr spurred legal challenges to this system across Europe (see article). Some decisions are already headed to appeal, and it seems sure that eventually at least a few will make it all the way up the tree to the European Court of Justice.

The price of freedom
Those cases will help determine the long-term impact of the gdpr. So will the degree to which other countries take up ideas like those of Mr Mundt, the German regulator. European regulators do not all see eye to eye on mingling privacy and antitrust, according to Alec Burnside of Dechert, a law firm. But he notes that there is something much closer to consensus on it than there would be in America. The way Ms Vestager talks about privacy seems quite in line with her German counterpart.

Tech lobbyists in Brussels worry that Ms Vestager agrees with those who believe that their data empires make Google and its like natural monopolies, in that no one else can replicate Google’s knowledge of what users have searched for, or Amazon’s of what they have bought. She sent shivers through the business in January when she compared such companies to water and electricity utilities, which because of their irreproducible networks of pipes and power lines are stringently regulated.

Sometimes the power of such networks gets them broken up: witness at&t. Elizabeth Warren, a senator who wants to be the Democratic Party’s presidential candidate in 2020, has suggested Facebook and Google could also be split up. Ms Vestager pours cold water on the idea. But Europe’s privacy-plus-antitrust approach offers a halfway house: force the companies to share their data, thus weakening their market power and empowering the citizenry.

In mid-March a panel appointed by the British government and led by Jason Furman, a Harvard economist who was an adviser in Barack Obama’s White House, advocated such an approach, suggesting a regulator empowered to liberate data from firms to which it provided “strategic market status”. An eu panel with a similar remit is expected to issue recommendations along the same lines soon.

The idea is for consumers to be able to move data about their Google searches, Amazon purchasing history or Uber rides to a rival service. So, for example, social-media users could post messages to Facebook from other platforms with approaches to privacy that they prefer. The innovative engineers of the tech incumbents would still have vast troves of data to work with. They could just no longer count on privileged access to them. The same principle might also lead to firms being able to demand anonymised bulk data from Google to strengthen rival search engines. Viktor Mayer-Schönberger of Oxford University points to precedent: large German insurers have to share data with smaller rivals to help them gauge risk.

This may not be as fine a solution as it might sound. Getting lots of personal data to move freely while also keeping it safe is not straightforward. Users would be required to give serious thought to the question of with whom they wanted to share their information, as opposed to blindly clicking “Accept” buttons to get rid of pop-ups, as mostly happens today. Anonymising a large dataset—such as a compendium of Google searches which might then be used to train a rival’s algorithms—is harder than it might seem. Identifiable data about individuals can seep regardless.

And there may not be much appetite for it. Following Britain’s lead, the eu has forced banks to allow their clients to move their data to third parties. But demand for services that let personal-finance apps look at your bank statements has yet to take off. Google and Facebook offer their users the possibility of downloading a portion of the data those users have provided to the firms (though those taking the offer up are best advised to have a large hard drive). But few rivals have invested in complementary systems that allow you to upload those data, suggesting that a lack of user data is not the factor limiting their ability to take on today’s incumbents.

Still, the assumption remains that a combined focus on antitrust and privacy could, over time, both reduce the incumbents’ market power and open up new routes to competition. Enthusiasts point to ibm, faced with antitrust action, divorcing its software and hardware businesses in 1969. That created a new industry for software writers to explore. A world of social networks empowered to share aspects of Facebook’s map of who knows whom and likes what, while being free to explore business models other than advertising could produce all sorts of profitable, socially useful innovation by firms in Europe and around the world. And though Facebook might not do as well in such a future as it would if given free rein, it could still prosper. The past half-century has not been an irredeemably shabby one for ibm.

Europe alone might not be able to bring all this about. But a mixture of the accommodations companies make to it and the example it sets to others could have a catalysing effect. The appearance of a European commissioner at sxsw is a rarity. Progressive American politicians were this year rarely a thumbdrive-throw away. They could have done worse than stop by and listen. Demanding that tech giants be broken up may get the odd rally chanting, but it would be hard to bring about. Calling on them to give power back to the people, though, has a certain ring to it.

This article appeared in the Briefing section of the print edition under the headline “The power of privacy”

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Telegram gets 3M new signups during Facebook apps’ outage

March 19, 2019

Natasha Lomas@riptari / 5 days ago
Messaging platform Telegram claims to have had a surge in signups during a period of downtime for Facebook’s rival messaging services.

In a message sent to his Telegram channel, founder Pavel Durov wrote: “I see 3 million new users signed up for Telegram within the last 24 hours.”

It’s probably not a coincidence that Facebook and its related family of apps went down for most of Wednesday, as we reported earlier. At the time of writing, Instagram’s service has been officially confirmed restored. Unofficially, Facebook also appears to be back online, at least here in Europe.

Durov doesn’t offer an explicit explanation for Telegram’s sudden spike in signups, but he does take a thinly veiled swipe at social networking giant Facebook — whose founder recently claimed he now plans to pivot the ad platform to “privacy.”

“Good,” adds Durov on his channel, welcoming Telegram’s 3M newbies. “We have true privacy and unlimited space for everyone.”

A contact at Telegram confirmed to TechCrunch that the Facebook apps’ downtime is the likely cause of its latest signup spike, telling us: “These outages always drive new users.”

Though they also credited growth to “the mainstream overall increasing understanding about Facebook’s abusive attention harvesting practices.”

A year ago Telegram announced passing 200 million monthly active users. Though the platform has faced restrictions and/or blocks in some markets (principally Russia and Iran, as well as China) — apparently for refusing government requests for encryption keys and/or user information.

In Durov’s home country of Russia the government is also now moving to tighten internet restrictions via new legislation — and thousands of people took to the streets in Moscow and other Russian cities this weekend to protest growing internet censorship, per Reuters.

Such restrictions could increase demand for Telegram’s encrypted messaging service in the country as the app does appear to still be partially accessible there.

Durov, who famously left Russia in 2014 — stepping away from his home country and an earlier social network he founded (VK.com) because of his stance on free speech — has sought to thwart the Russian government’s Telegram blocks via legal and technical measures.

The Telegram messaging platform has of course also had its own issues with less political downtime too.

In a tweet last fall the company confirmed a server cluster had gone down, potentially affecting users in the Middle East, Africa and Europe, although in that case the downtime only lasted a few hours.

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Privacy Problems Mount for Tech Giants

January 21, 2019

By Sam Schechner
Jan. 21, 2019 6:30 a.m. ET

Big tech companies have taken a public lashing in the past year over their handling of users’ personal information. But many of their biggest privacy battles have yet to be fought—and the results will help determine the fate of some of the world’s largest businesses.

So far, tech giants like Facebook Inc. and Alphabet Inc.’s Google have proved relatively resilient against a growing backlash over possible abuse of their users’ personal privacy. Tech companies’ stocks may have swooned, but advertisers are continuing to cut them checks, and their profits are still growing at double-digit rates that would earn most CEOs a standing ovation.

This year may be stormier. Growing discontent among users over privacy and other issues—such as the widespread feeling that mobile devices and social media are addictive—could damp profit growth, discourage employees or chase away ad dollars. In Europe, regulators are slated to make major rulings about tech companies’ privacy practices, likely setting off high-stakes litigation. In the U.S., revelations about allegedly lax privacy protections are raising political pressure for federal privacy regulation.

At risk are tens of billions of dollars that marketers spend every year in online advertisements targeted at users with the help of personal information about individuals’ web browsing, mobile-app usage, physical location and sometimes other data, like income levels.

The behavior of tech giants is likely to be a major topic at the World Economic Forum this week in Davos, Switzerland. While the yearly meeting of world leaders and company executives normally celebrates how businesses can solve the world’s problems, tech companies were on the defensive last year against complaints that ranged from fomenting political polarization to building artificial intelligence that will displace millions of workers.

Since then, the pressure has increased. Facebook executives have been dragged before legislators on both sides of the Atlantic, after the company said data related to as many as 87 million people may have been improperly shared with Cambridge Analytica, a political analytics firm. And in September, Facebook said hackers had gained access to nearly 50 million accounts.

Google, meanwhile, has faced criticism of its privacy practices from political leaders, including flak after The Wall Street Journal reported that the company had exposed the private data of hundreds of thousands of users of its Google+ social network and opted initially not to disclose it.

Some tech executives have raised alarms, too. Apple Inc. Chief Executive Tim Cook, speaking in October before a privacy conference organized by the European Union, called for tighter regulation in the U.S. along the lines of a strict new privacy law in the EU, saying that some companies had “weaponized” users’ personal information in what he described as a “data-industrial complex.”

Facebook and Google both say that they have been investing heavily in improving how they protect user privacy and that they welcome tighter privacy rules; both companies support passage of a U.S. federal privacy law. Tech-industry lobbyists say they are planning to support U.S. privacy legislation over the coming year, in part to avoid contending with a patchwork of laws like one passed last year in California.

“Our industry strongly supports stronger privacy protections for consumers,” says Josh Kallmer, executive vice president for policy at the Information Technology Industry Council, which represents Facebook, Google and other tech companies. Mr. Kallmer says consumers “benefit incredibly from these technological innovations,” but adds that “alongside that are some very legitimate concerns about how data is being handled.”

What impact will stricter privacy rules have? There are two theories.

One school of thought says that stricter rules and tighter enforcement will benefit big, incumbent companies that already have access to large amounts of user data and can spend more heavily on legal-compliance efforts. The other argues that rules like those in the EU’s new General Data Protection Regulation, if strictly applied, will force significant changes to how the biggest tech companies collect and analyze individuals’ personal information—undercutting their advertising businesses and weakening their advantage over existing or potential new competitors.

“Both are reasonable claims. But it is far too early to tell which will turn out to be true,” says Alessandro Acquisti, a professor at Carnegie Mellon University who studies the behavioral economics of privacy.

At issue, in part, is the distinction between short-term and long-term effects. There are signs that Google, for one, benefited at least initially from the transition to the GDPR in May, in part because advertisers shifted money to the bigger firms, which were able to show they had users’ consent to display targeted ads.

In Europe, Google saw a 0.9% increase in the share of websites that include its advertising trackers two months after the GDPR went into effect compared with two months before, according to Cliqz, which makes antitracking tools for consumers. Facebook’s share declined 6.7%. The share for the other top 50 online-ad businesses fell more than 20%.

The longer-term impact on big firms is harder to predict. One study of nearly 10,000 online display advertising campaigns showed that users’ intent to purchase products was diminished after earlier EU laws restricted advertisers’ ability to collect data in order to target those ad campaigns. But more research is needed to determine what impact tighter rules would have on consumer spending more broadly, Prof. Acquisti says.

How the laws are enforced by regulators and courts will play an important role. Ireland’s Data Protection Commission, which is the EU’s lead regulator for Facebook and Google, is investigating complaints from privacy activists that the consent companies sometimes request for the processing of individuals’ data is a condition of using a service and so is not “freely given,” as the law requires.

In Germany, the federal antitrust enforcer says it will issue early this year a final decision regarding its preliminary finding that Facebook uses its power as the most popular social network in the country to strong-arm users into allowing it to collect data about them from third-party sources. A German decision wouldn’t involve fines, but could include orders to change business practices.

Both Facebook and Google say they comply with privacy laws.

Initial decisions could come this year, but whichever way the watchdogs come down, their actions are likely to end up reviewed in court. Those cases will end up determining how new privacy standards will be applied. And that will determine how profound their impact is.

“There is active litigation in a couple of places that could become hugely important,” Mr. Kallmer says. “It’s uncertainty that our industry thinks it’s on the right side of.”

Mr. Schechner is a Wall Street Journal reporter in Paris. Email sam.schechner@wsj.com.

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Just Don’t Call It Privacy

September 23, 2018

What do you call it when employers use Facebook’s advertising platform to show certain job ads only to men or just to people between the ages of 25 and 36?

How about when Google collects the whereabouts of its users — even after they deliberately turn off location history?

Or when AT&T shares its mobile customers’ locations with data brokers?

American policymakers often refer to such issues using a default umbrella term: privacy. That at least is the framework for a Senate Commerce Committee hearing scheduled for this Wednesday titled “Examining Safeguards for Consumer Data Privacy.”

After a spate of recent data-mining scandals — including Russian-sponsored ads on Facebook aimed at influencing African-Americans not to vote — some members of Congress are now rallying behind the idea of a new federal consumer privacy law.
At this week’s hearing, legislators plan to ask executives from Amazon, AT&T, Google, Twitter and other companies about their privacy policies. Senators also want the companies to explain “what Congress can do to promote clear privacy expectations without hurting innovation,” according to the hearing notice.

There’s just one flaw with this setup.

In a surveillance economy where companies track, analyze and capitalize on our clicks, the issue at hand isn’t privacy. The problem is unfettered data exploitation and its potential deleterious consequences — among them, unequal consumer treatment, financial fraud, identity theft, manipulative marketing and discrimination.
In other words, asking companies whose business models revolve around exploiting data-based consumer-influence techniques to explain their privacy policies seems about as useful as asking sharks to hold forth on veganism.

“Congress should not be examining privacy policies,” Marc Rotenberg, the executive director of the Electronic Privacy Information Center, a prominent digital rights nonprofit, told me last week. “They should be examining business practices. They should be examining how these firms collect and use the personal data of customers, of internet users.”

The Senate Commerce hearing, however, doesn’t seem designed to investigate commercial surveillance and influence practices that might merit government oversight.
For one thing, only industry executives are currently set to testify. And most of them are lawyers and policy experts, not engineers versed in the mechanics of data-mining algorithms.

Companies are sending their “policy and law folks to Washington to make the government go away — not the engineering folks who actually understand these systems in depth and can talk through alternatives,” Jonathan Mayer, an assistant professor of computer science and public affairs at Princeton University, told me.

That may be because Congress is under industry pressure.

California recently passed a new privacy law that would give Californians some power over the data companies’ hold on them. Industry groups hope to defang that statute by pushing Congress to pass federal privacy legislation that would overrule state laws. The industry-stacked Senate hearing lineup seems designed to pave the way for that, said Danielle Citron, a law professor at the University of Maryland.

Frederick Hill, a spokesman for the Senate Commerce Committee, said the group planned future hearings that would include other voices, such as consumer groups. But “for the first hearing,” Mr. Hill said, “the committee is bringing in companies most consumers recognize to make the discussion about privacy more relatable.”

What is at stake here isn’t privacy, the right not to be observed. It’s how companies can use our data to invisibly shunt us in directions that may benefit them more than us.

Many consumers know that digital services and ad tech companies track and analyze their activities. And they accept, or are at least resigned to, data-mining in exchange for conveniences like customized newsfeeds and ads.

But revelations about Russian election interference and Cambridge Analytica, the voter-profiling company that obtained information on millions of Facebook users, have made it clear that data-driven influence campaigns can scale quickly and cause societal harm.
And that leads to a larger question: Do we want a future in which companies can freely parse the photos we posted last year, or the location data from the fitness apps we used last week, to infer whether we are stressed or depressed or financially strapped or emotionally vulnerable — and take advantage of that?

“Say I sound sick when I am talking to Alexa, maybe they would show me medicine as a suggestion on Amazon,” said Franziska Roesner, an assistant professor of computer science at the University of Washington, using a hypothetical example of Amazon’s voice assistant. “What happens when the inferences are wrong?”

(Amazon said it does not use Alexa data for product recommendations or marketing.)

It’s tough to answer those questions right now when there are often gulfs between the innocuous ways companies explain their data practices to consumers and the details they divulge about their targeting techniques to advertisers.

AT&T’s privacy policy says the mobile phone and cable TV provider may use third-party data to categorize subscribers, without using their real names, into interest segments and show them ads accordingly. That sounds reasonable enough.

Here’s what it means in practice: AT&T can find out which subscribers have indigestion — or at least which ones bought over-the-counter drugs to treat it.

In a case study for advertisers, AT&T describes segmenting DirecTV subscribers who bought antacids and then targeting them with ads for the medication. The firm was also able to track those subscribers’ spending. Households who saw the antacid ads spent 725 percent more on the drugs than a national audience.

Michael Balmoris, a spokesman for AT&T, said the company’s privacy policy was “transparent and precise, and describes in plain language how we use information and the choices we give customers.”
But consumer advocates hope senators will press AT&T, Amazon and other companies this week to provide more details on their consumer-profiling practices. “We want an inside look on the analytics and how they’re categorizing, ranking, rating and scoring us,” Professor Citron said.

Given the increased public scrutiny, some companies are tweaking their tactics.

AT&T recently said it would stop sharing users’ location details with data brokers. Facebook said it had stopped allowing advertisers to use sensitive categories, like race or religion, to exclude people from seeing ads. Google created a feature for users to download masses of their data, including a list of all the sites Google has tracked them on.

Government officials in Europe are not waiting for companies to police themselves. In May, the European Union introduced a tough new data protection law that curbs some data-mining.

It requires companies to obtain explicit permission from European users before collecting personal details on sensitive subjects like their religion, health or sex life. It gives European users the right to see all of the information companies hold about them — including any algorithmic scores or inferences.

European users also have the right not to be subject to completely automated decisions that could significantly affect them, such as credit algorithms that use a person’s data to decide whether a bank should grant him or her a loan.

Of course, privacy still matters. But Congress now has an opportunity to press companies like Amazon on broader public issues. It could require them to disclose exactly how they use data extracted from consumers. And it could force companies to give consumers some rights over that data.

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Apple’s App Store Privacy Crackdown May Hurt Facebook’s Onavo

June 15, 2018

Apple Inc.’s new rules for app developers limit their ability to harvest user contact data, but they also could hurt a key app owned by Facebook Inc. called Onavo Protect.

The iPhone maker’s updated App Store Review Guidelines ban applications that “collect information about which other apps are installed on a user’s device for the purposes of analytics or advertising/marketing.” This could give Apple grounds to remove the Onavo app, although the software is still available despite the rules kicking in last week.

Onavo Protect, when installed on an iPhone or Android device, uses a virtual private network to scan incoming and outgoing internet connectivity. It also gathers information about users’ devices, their location, apps installed on the gadgets and how people use those apps, what websites they visit, and the amount of data used, Facebook wrote in answers to Congressional questions that the social network operator posted online Monday.

Onavo collects data on other apps via networks, rather than through devices. The iPhone maker already blocks apps from getting information from other apps on the device itself via a technology called sandboxing.

Apple’s new guidelines “sound like they’re almost written in response to what Onavo and others have been doing,” said Will Strafach, a researcher who has studied Onavo Protect and focuses on the security of Apple’s iOS mobile operating system. A Facebook spokeswoman declined to comment.

Apple has criticized Facebook this year for privacy missteps, and the iPhone maker recently announced new controls for iPhones, iPads and Macs that will limit how internet companies like Facebook and Google track web browsing.

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Rebiton Allows You to Buy Bitcoin and Keep Your Privacy
April 8, 2019

by Kai Sedgwick Purchasing bitcoin ought to be quick and easy, but over the years, encroaching KY...

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Big tech faces competition and privacy concerns in Brussels
March 25, 2019

And the sector may be the better for it Print edition | Briefing Mar 23rd 2019 | PARIS Around 19 ...

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Telegram gets 3M new signups during Facebook apps’ outage
March 19, 2019

Natasha Lomas@riptari / 5 days ago Messaging platform Telegram claims to have had a surge in signup...

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Apple tied to new privacy website, suggesting future security marketing
March 6, 2019

The iPhone maker, which makes privacy a selling point for its devices, appears to be gearing up for ...

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