Just use an ad-blocker, geez.
The FTC has released a report criticizing top social media and streaming companies for what it calls “vast surveillance of consumers in order to monetize their personal information.” Yeesh.
For the report, the FTC asked platforms like Twitch, Facebook, WhatsApp, YouTube, Twitter/X, Snap, TikTok, Discord, Instagram, and Reddit for information about their data practices, including data collection, ad and content display, algorithm use, and their approach to protecting younger users. The new report is a summary of the FTC’s findings, along with policy and compliance recommendations.
“Social media and video streaming companies harvest an enormous amount of Americans’ personal data and monetize it to the tune of billions of dollars a year,” says FTC Chair Lina Khan. “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 identify theft to stalking.”
Why This Matters:
The report lands as lawmakers (continuously) grapple with new data privacy legislation that could reshape the industry. Take The American Privacy Rights Act (APRA), for example, which was introduced in April and would create the first comprehensive federal data privacy law in the U.S.
The FTC is in favor of new regulations, of course, as the report is critical, not just of current ad practices, but of personalized advertising in general. “Targeted advertising can pose serious privacy risks to consumers,” reads page 40 of the 100-plus page report. It goes on to highlight concerns about targeted ads, particularly those using pixels and SDKs, and cautions about potential inaccuracies and biases that may affect consumers.
In the end, the FTC recommends that social media and streaming platforms avoid collecting sensitive user data, and, if they do collect it, to take more comprehensive steps to mitigate risks and minimize potential misuse or harm downstream.
Experts React:
Speaking to The Washington Post, Discord’s head of public policy for North America, Kate Sheerin, says the analysis “lumps very different models into one bucket and paints [with] a broad brush, which might confuse consumers and portray some platforms, like Discord, inaccurately.”
Our Take:
Right now, the FTC seems to undervalue personalized online advertising and the companies that make it possible. (This recent blog post on hashed IDs comes to mind.)
Today’s report seems to reinforce that, and, despite the industry’s efforts, demands are ever-increasing. Ultimately, while it’s critical for the category to continue tackling concerns, especially those involving teenagers and children, more education to inform the public and policymakers about the advantages and value of targeted ads is also needed.
But easier said than done. Most people are unaware of the hidden costs associated with non-personalized ads, like pricier content and services. This will always complicate the industry’s efforts to convey its value.
