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FTC accuses 9 social media platforms like X, Insta, TikTok of ‘vast surveillance’ of consumers

The US Federal Trade Commission (FTC) has released a staff report accusing nine major social media and video streaming companies, including TikTok, Meta, and X (formerly Twitter), of extensive surveillance of consumers to monetize their data.

The report, which was made public on Thursday, suggests that these companies have been exploiting user information without providing adequate protection, particularly for minors.

Inadequate data protection
The FTC’s findings reveal that these companies not only collected and monetized vast amounts of personal data but also found their data collection, minimization, and retention practices to be “woefully inadequate.”

This lack of proper safeguards has left consumers vulnerable to various risks, including identity theft and stalking. The report also emphasized that the failure to protect children and teenagers online is particularly concerning, as these platforms needed to implement different privacy measures for users under 18 compared to adults.

The study began nearly four years ago and was based on responses from orders issued in December 2020 to nine companies overseeing 13 social media and video streaming services. These orders requested detailed information on each company’s operations between 2019 and 2020.

The investigation highlighted that despite the companies claiming compliance with the Children’s Online Privacy Protection Act (COPPA), the protections offered were minimal, with significant lapses once a child turned 13.

Mass data collection motivated by profit
The FTC report also shed light on these companies’ business models, which were found to incentivize the mass collection of data from users and, in some cases, non-users. This data was often monetized through targeted advertising.

The study uncovered that some companies purchased information from data brokers and third parties to enhance user profiles, including details about consumers’ offline activities. These profiles were then used to target specific consumer segments for advertisers.

The report pointed out that aside from one exception, most companies did not allow users to opt in or out of having their data used in algorithms, data analytics, or artificial intelligence. This practice further demonstrates the prioritization of profit over user privacy. Although some companies have since updated their policies under increasing scrutiny from state and federal regulators, the FTC remains critical of the industry’s self-regulation efforts.

Calling for legislative action
The FTC’s report concludes that self-regulation in the industry has largely failed and that stronger legislative measures are needed to protect consumers, especially teenagers. While the report makes several recommendations for companies and Congress, including introducing federal legislation to limit surveillance and extend protections to users over 13, it did not specify any immediate enforcement actions.

The report serves as a stern reminder of the growing need for comprehensive privacy laws to safeguard consumer data in an increasingly digital world.

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