Feds vs. Facebook: Just Give Up Now

It was inevitable, really: between the need of Congressional Democrats to rattle the media cage, and the need of Facebook to turn itself into a viable ad platform at any cost, there was bound to be some kind of collision. Predictably, the issue is privacy. Equally predictable is the outcome: Facebook will have to offer at least a few real concessions to hold on to the basic core strategy.

Last week, Facebook announced a bold new audience and advertising strategy that will extend its presence across the Web through partnerships with sites like Pandora, Yelp and Microsoft Docs. The new strategy involves sharing user information from Facebook with these other Web sites. Today four U.S. Senators -- Sen. Charles Schumer, D-NY, Sen. Michael Bennet, D-CO, Sen. Mark Begich, D-AK, and Sen. Al Franken, D-MN -- are demanding that Facebook implement new controls that will make it easier for users to determine how much of their personal information is shared with other Web sites.

I'm no legal expert, so I couldn't say whether Facebook really runs a risk of crossing some regulatory authority on privacy issues (although MediaPost's Wendy Davis thinks the new strategy is problematic). I doubt very much that the company would undertake something of questionable legality at this point in its existence -- but that doesn't mean it will be smooth sailing. In the past misconceived revamps and new programs like Beacon have encountered strident opposition from Facebook users, even though they were perfectly legal and also covered by the site's existing terms of use. In keeping with the basic ethos of a social network, there are other criteria beyond legality to consider -- namely, public opinion.

That's where Congress comes in. Always ready to grandstand unhelpfully, members of Congress seem compelled to insert themselves into controversial media debates, whether or not they possess any actual expertise or useful advice. A good example is the recently concluded Congressional hearings about issues surrounding Arbitron's Portable People Meter for radio ratings. The hearings were held at the behest of minority broadcasters who asserted that Arbitron's audience samples failed to adequately represent minority listeners. Obviously this was a rather complex technical issue involving the firm's sampling methodology, audience sociology, and statistical validity, and it's unclear what a couple sound bites from a full-time politician could contribute to this quantitative quagmire -- but that didn't stop the House Committee on Government Oversight and Reform from holding months of "inquiries."

The Arbitron example is instructive and cautionary for Facebook. After a lot of back and forth and around and around, Congress heard testimony from the Media Rating Council, which reminded Congress that it had created the MRC back in the 1960s for just this very purpose (i.e., maintaining quality standards in media ratings). Surprised at its own foresight, Congress joined MRC boss George Ivie in encouraging minority broadcasters to join the MRC, so they could gain access to confidential information regarding Arbitron's sampling techniques and also have a say in future reviews of PPM methodology. Last week Arbitron, the MRC, and the minority broadcasters announced they reached an agreement wherein Arbitron would take steps to improve minority sampling techniques.

Congress declared victory without really having done anything -- and that's the whole point. Congressional hearings don't seem designed to achieve much of anything; rather, they simply generate a continuous stream of negative publicity for companies accused of political (but not legal) transgressions, until the companies "voluntarily" agree to take whatever measures seem necessary to placate public opinion.

Frankly, in my humble opinion, Facebook would be well advised to just skip this whole process by caving in to the Senators' demands now. Because ultimately you can't win. The really dangerous thing about Congressional hearings is that they can go on forever: members of Congress get paid no matter what, and positively revel in the publicity. They want the hearings to last forever, and the universe of subject matter they can address is effectively infinite.

Meanwhile, ironically enough, Facebook users have already come up with an effective response to the Facebook changes. A message has been making the rounds which reads: "There is a new privacy setting called 'Instant Personalization' that shares data with non-Facebook websites and it is automatically set to 'Allow.' Go to Account > Privacy Settings > Applications and Websites and uncheck 'Allow.' Please copy & repost."

1 comment about "Feds vs. Facebook: Just Give Up Now".
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  1. Howie Goldfarb from Blue Star Strategic Marketing, April 27, 2010 at 6:36 p.m.

    How different is this from Beacon and Behavioral Targeting? Not much.

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