With Meta already up to its neck in ad tool restrictions on various fronts, as a result of changes to data usage regulations, along with Apple’s iOS 14 update, it could soon face another challenge, with the FTC moving to ban the company from fully monetizing youth data.

The FTC Is At It Again

Under a new decree from the Trade Commission, Meta would be banned from collecting any data, unless for security purposes, from all users under the age of 18, and monetizing such, until they become adults. The FTC claims that Meta has violated the terms of its 2020 privacy order, which stipulated that Meta needed to implement a range of strict controls over data usage as a result of the infamous Cambridge Analytica Scandal. Meta was also fined $5 billion as part of the settlement.

The FTC specifically says that Meta has misrepresented the controls that parents have over who their kids can communicate with via Messenger Kids. At the same time, the FTC also alleges Meta continuing to give app developers access to user’s private information. As a result, the FTC is now moving to the next stage of a broader data usage ban.

According to the FTC:

“Facebook has repeatedly violated its privacy promises. The company’s recklessness has put young users at risk, and Facebook needs to answer for its failures.”

As part of the FTC’s proposed changes, Meta would be prohibited from profiting from any data that it collects, including those acquired through its VR products, from users under 18, while Meta would also be subject to expanded limitations on other fronts, including the use of facial recognition tech.

The FTC also mentions that Meta would be required to pause the launch of all its new products and services pending an independent assessment of its compliance with these terms. The FTC isn’t pulling any punches this time, and Meta’s given 30 days to respond before the FTC decides on the next steps to take. Meta issued this statement on this new push.

So, what’s next? As per classic Meta, the defiant company will stand its ground and challenge these claims, and given the fines it had to cop the last time, that’s perfectly understandable. As noted, Meta’s also dealing with significant challenges to its ad business, which has already cost it lots in lost revenue. Further loss of user data access will only further compound this, so Meta has even more reason to go against the FTC to maintain its current systems.

The Wrap

Regardless, Meta will now have to show cause for its alleged violations, and the FTC will require a clear legal basis to push things to the next stage, should it choose to go that route. This could have some big implications for Meta in the long term, but it’s too early right now to know what the full impacts might be. To its benefit, Meta has overcome similar large hurdles before, and, on occasion, has defied the odds. It might pull off another huge upset with this.

Sources

https://bit.ly/3pcolYy