The FTC and Meta: Watching a Giant Fall Over

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FTC to Expand Meta’s Data Privacy Settlement to Ensure Compliance

Federal Judge Timothy Kelly has denied Meta’s attempt to stop the expansion of a $5 billion data privacy settlement from 2019 that ensured compliance.

  • The decision opens the door for the FTC to suggest demanding rules governing how Meta can monetize user data.
  • The proposed changes will impede Meta’s ability to monetize data from users under 18, force the scale back of its facial recognition technology and subject it to third-party scrutiny.

Federal judge Timothy Kelly has ruled against Meta’s attempt to block the expansion of a $5 billion privacy settlement from 2019.

The judge’s decision allows the FTC to move forward with proposing strict rules on how Meta, the parent company of Instagram and Facebook, can monetize user data.

The proposed changes will hinder Meta’ monetization of data from users under 18. Over the years, Meta’s business model became increasingly data centric as the company seeks to engage a younger audience and make its “metaverse” dreams come true.

The FTC saw their opening and took it. It has suggested regulations that would limit the company’s use of facial recognition technology. It will also mandate third-party audits before any new product or service launches to verify compliance with the settlement’s data privacy obligations.

We haven’t seen such a development in years. Not since 2020 when the federal investigation into Meta’s Cambridge Analytica privacy scandal, when up to 87 million users’ information was exposed accidentally, had been concluded with a penalty of $5 billion.

In response, Meta announced that it’s appealing the judge’s decision to the U.S. Court of Appeals for the District of Columbia. Facebook’s parent company argues the allegations lack merit and accused the FTC of pulling a “political stunt.” It also emphasized its investment of $5 billion in a privacy program since 2019 as they believe it is a show of commitment to user privacy on their end.

A Meta spokesperson said judge Kelly’s decision “does not address the substance of the FTC’s allegations, which are without merit. By the end of this year, we will have invested $5 billion since 2019 in a rigorous privacy program that has embedded privacy into our products from the start.”

Who’s going to tell the 867.74-billion-dollar company that if things are still “slipping” through the cracks, the program isn’t enough, regardless of the price tag?

As the matter continues to unfold, the outcome will have significant implications for all companies neglecting the security of user data and the safety of the users themselves.

Meta, like many other Big Tech companies, has become too big for its britches. And now, the day has come when we watch with morbid fascination as giants fall.

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