BY GREGORY FERENSTEIN Wed Feb 23, 2011
Facebook's response to the FTC urges optimism and governmental restraint.
Facebook just released a 26-page retort to the Federal Trade Commission’s preliminary report on privacy regulation--a report that social media firms see as an ominous approaching storm of chaotic bureaucracy. In summary, Facebook fears that government meddling could stifle both its ability to profit and smother the industry’s progress on yet-unknown technological advancements.
Facebook responded in mirror-image to the FTC; first, (respectively) reminding the FTC how much social media has done for the government itself, the advancement of democracy, and the growing cottage industry of social software:
"In government, leaders use social media services to promote transparency, as evidenced by the nearly 140,000 followers of the White House Press Secretary's Twitter feed and the fact that more than 70 federal agencies have Facebook pages."
"Advocates of democracy used Twitter to make their voices heard following the contested 2009 Iranian election of and Oscar Morales in Colombia famously employed Facebook to organize massive street demonstrations against the FARC terrorist group in 2008. Most recently, people in Tunisia and Egypt used social media to spread up-to-the-minute news, share videos of local events with the broader population, and mobilize online communities of thousands (and sometimes millions) behind a common cause."
"Finally, the social web is a crucial engine for economic growth and job creation. Hundreds of thousands of application developers have built businesses on Facebook Platform. To take just one example, games developer Zynga, creator of the popular Farmville game, has more than 1,300 employees and has been valued at about $5.8 billion."
Second, it pleaded for the FTC to be optimistic about how ostensibly intrusive technologies end up benefiting the public:
"Telephone companies originally collected and exchanged subscribers’ telephone numbers solely for the purpose of completing telephone calls. But telephone companies later realized that they could use this information to display the calling party's telephone number and name to the call recipient, allowing the recipient to identify the caller in advance. Today, caller ID is an accepted and valued part of telephone communication, and few subscribers choose to block outgoing caller ID even though it is easy to do so."
"In 2006 Facebook launched a new feature called News Feed on every person's homepage. The product updated a personalized list of news stories throughout the day so users would know what their friends were posting. Before News Feed, people had to visit their friends' profiles to see what their friends were up to. Despite initial user skepticism when the product was first launched, News Feed is now--as any user would attest--an integral part of the Facebook experience."
Google Flu Trends
"When the founders of Google began collaborating on a search engine research project in 1996, they probably did not envision that search queries about topics would one day become an early detection system for flu outbreaks. Today, Google Flu Trends can estimate flu activity one to two weeks more quickly than traditional surveillance systems involving virologic and clinical data, and may help public health officials and health professionals better respond to seasonal epidemics."
Finally, Facebook urged the FTC to be sensitive to the business implications of its decisions: “For Facebook--like most other online service providers--getting this balance right is a matter of survival,” the report notes.
It continued, "Ultimately, the FTC's enforcement activities in the area of privacy must be guided by the realization that aggressive enforcement and imprecise standards can lead to more legalistic disclosures--and, as described above, chill economic growth--as companies seek to manage regulatory risk by over-disclosing, reserving broad rights, and under-innovating. To avoid these unintended consequences, the FTC should err on the side of clarifying its policies rather than taking aggressive enforcement action against practices that previously were not clearly prohibited."
Both the FTC and Facebook have been light on data on experimental evidence--and both are obscuring a yet unrevealed future value (or detriment) associated with all of this sharing. Then again, forecasting problems into a very turbulent future is nearly impossible. Ultimately, both documents read like the fight will come down to a philosophical debate. And billions of dollars.
Full Facebook response at: http://www.fastcompany.com/1731121/facebook-ftc-response