Facebook in Global Crosshairs for Privacy, Antitrust Issues

The Federal Trade Commission fined Facebook about $5 billion for privacy violations, but the sum is considered a slap on the wrist since it neither hurt the company’s bottom line nor limited its ability to collect data. But, since 2016, 43+ countries have passed or introduced laws regulating social media and the spread of fake news, and U.S., European and Canadian regulators have initiated investigations and proposed regulations that will likely be much more draconian. Congress is considering a federal privacy law.

The New York Times reports that President Trump has also called Facebook (and other tech companies) “dishonest” and “crooked,” adding that, “something is going to be done.” Today, the House Judiciary subcommittee on antitrust will hold a hearing with executives from Amazon, Apple, Facebook and Google, and the Senate Banking Committee will hear from Facebook executive David Marcus about the company’s proposed cryptocurrency, Libra, which is under scrutiny.

A British report from Parliament called Facebook “digital gangsters,” “officials are writing new competition and social media laws, and regulators have started a broad antitrust inquiry targeted at Facebook and Google.” France is considering new penalties regarding hate speech, and “Australia, Japan, India, New Zealand and Singapore are either considering or have passed new rules against big Internet platforms.”

“The debate has shifted,” said European Commission chief economist Tommaso Valletti, a professor at Imperial College Business School. “The right question is not whether to intervene, but what kind of intervention do we need.” NYT notes that “the European Commission has shared information with the FTC and the Justice Department about its past investigations into Google … [and] Ireland’s top privacy regulator, who has been investigating Facebook and Google, met with officials in Washington.”

FTC head Joseph Simons and the Justice Department’s Makan Delrahim, the assistant AG overseeing antitrust, both attended a global conference of antitrust regulators “focused on the tech industry.”

Germany’s top antitrust regulator Andreas Mundt, as well as many others, “believe that actions against Facebook and its industry peers must go beyond fines” and hope to “force structural changes to how the businesses operate — like their collection of data and sale of digital advertising.” Ireland, where Facebook has its European headquarters, has 11 investigations on-going “against Facebook for violations of European privacy law, the General Data Protection Regulation, or GDPR.”

Even so, “some academics and free speech advocates have raised concerns that in a rush to limit Facebook’s power, governments are drafting policies with unintended consequences.” Singapore and India have floated the idea of giving the government the power to censor social media content. “The [policies] are all very reactionary,” said Oxford Internet Institute doctoral student Samantha Bradshaw. “I haven’t seen any proposals that really get to these systemic-level challenges about the algorithms, the data collection, and the privacy.”

The Wall Street Journal notes that, with regard to the penalty levied against Facebook, “FTC commissioners broke along party lines, 3-2, with the Republican majority lining up to support the pact while Democratic commissioners objected.” It also added that “with the dollar amount approved this week, the FTC obtained a financial penalty higher than what European Union could have sought under its privacy law.”