Written: January 11, 2017
Any ad-based business model entails certain compromises when it comes to user privacy – there is an inverse relationship between how effectively ads can be targeted and how much users’ privacy is respected. Facebook is perhaps the best example of this tradeoff, and its genius is that users willingly hand over all kinds of data about themselves, from their relationship status to their age, and from their interests to the brands they like. But of course Facebook also collects other data on their users, including third party data it buys in.
However, this data collection and its use is entirely within the realm of Facebook’s ad platform – in theory, individual employees of Facebook don’t look at individuals’ data, and it’s largely machines leveraging the data to target ads. There have, however, been other cases of Facebook deliberately or inadvertently leaking user data to other users, though those are mostly in the past at this point. These included making default sharing of posts broader than users expected, sharing location data without users’ knowledge, and more. But Facebook seems to have learned a lot from these incidents, and seems to have taken a much more privacy-friendly stance of late.
Having said all that, there are still new privacy issues at Facebook – its attempt to merge WhatsApp and Facebook user data for better targeting on the Facebook side has rolled out without too much fuss in the US, but European regulators have not viewed it as kindly, and in some cases Facebook has been prevented from using this data.
As long as there are ad-based business models, the companies that make use of them will have to deal with privacy concerns. And as long as Facebook makes well over 90% of its revenue from ads, they’ll continue to be a major feature of coverage of the company too.