The FTC announced a settlement of their suit against Facebook regarding privacy on Tuesday. The government accused Facebook of engaging in “unfair and deceptive” practices and misleading its users regarding what private information they were sharing and with whom. The settlement requires Facebook to be more transparent and open about its privacy policies and subjects it to biannual privacy audits; however, no fines were levied and all-in-all Facebook got away with a mere slap on the wrist.
The settlement will likely have a greater impact on other social networks because Facebook has already reformed it privacy controls to be much stronger than they were in the past. The message from the FTC is now clear: “if you put the desires of advertisers before the privacy of users, you will be stopped. Just because you’re sitting on a ton of personal information that would make marketers drool, it doesn’t mean you can monetize it in any way you like.” The likely impact of this on the industry is a standardization of and a move towards the practice of opt-in. This move may actually benefit marketers more than it hurts them because customers who opt-in are more engaged and valuable than customers who don’t opt-out. “I think it’s a hugely positive step,” says Dmitry Shapiro, CEO of the social network Anybeat.
http://mashable.com/2011/11/29/facebook-ftc-settlement-2/
http://www.nytimes.com/2011/11/30/technology/facebook-agrees-to-ftc-settlement-on-privacy.html?ref=technology
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