Facebook Leveraged User Data to Cut Deals and Reward Friends, According to Leaked Documents Facebook Leveraged User Data to Cut Deals and Reward Friends, According to Leaked Documents
04.16.2019

A vast new trove of leaked documents, including internal emails and private messages between top leadership, show that when Facebook placed restrictions on user data starting in 2014, the priority was not to enhance privacy, as it has claimed. Instead, the restrictions were used primarily as a form of leverage in deals with apps that depended on the platform. The documents also seriously undermine Facebook’s claims that it “never sold user data,” which the company has repeated often since revelations about the misuse of Facebook data during the 2016 U.S. Presidential election.

The leaked documents show, according to an analysis by NBC News, that Facebook was not only willing to trade user data for business advantages, but that directly selling data was discussed by leaders in great depth over the course of years. The documents, obtained by media outlets via a leak, originated from a court case between Facebook and a startup called Six4Three, which sued after Facebook cut off its access to user data.

Similar restrictions were placed on many other apps starting in 2014, leading some of them to collapse. Apps that were seen as competing with Facebook by siphoning user attention were particularly likely to be targeted. But some strategic partners—prominently including big-spending advertisers—were given continued “whitelist” access to user data. Some employees questioned the ethics of this strategy, and even compared their own company to scheming villains from Game of Thrones.

Some employees questioned the ethics of this strategy, and even compared their own company to scheming villains from Game of Thrones.

One skeptical employee described the planned changes in a private chat in 2013: “So we are literally going to group apps into buckets based on how scared we are of them and give them different APIs? … So the message is, ‘if you’re going to compete with us at all, make sure you don’t integrate with us at all’?”

This seems like a textbook case of a company abusing its market position, closely paralleled to 2001 claims (ultimately resolved in a settlement) that Microsoft leveraged its operating system to squash competing web browsers. One commentator told NBC that the documents “clearly establish the value of consumer data to Facebook” amid growing calls to regulate digital platforms that aggregate and monetize such data.

The documents substantially undermine Facebook’s attempts to defend itself amidst ongoing scandal. The company has consistently stated, in more or less the same words, that it has “never sold user data.” But, despite denials from the company, NBC News concludes that it has for years given preferential treatment to apps run by Zuckerberg’s personal friends, and in other cases effectively traded user data for ad sales—a distinction without much of a difference.

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Facebook has even attempted to spin this strategy as a move on behalf of users. In a public address announcing the changes in 2014, Zuckerberg emphasized users’ desire for more control over data. As recently as December of 2018, in response to a prior leak of a small portion of the same court documents, Zuckerberg claimed that the “main purpose” of the 2014 restrictions was to “prevent abusive apps.”

But according to NBC’s reading of the new documents, the main motive was actually to squeeze money and other concessions out of app developers. Privacy was “rarely discussed in the thousands of pages of emails and meeting summaries” that were leaked. “Where privacy is mentioned, it is often in the context of how Facebook can use it as a public relations strategy”.

This was further illustrated in another email from Zuckerberg, which discussed user privacy only in terms of company strategy, rather than as subject to any ethical standard: “I’m generally skeptical that there is as much data leak strategic risk as you think . . . I think we leak info to developers but I just can’t think of any instances where that data has leaked from developer to developer and caused a real issue for us.”

One specific effort is to reduce Facebook and Google’s power by establishing a decentralized public standard for online identity.

The new information provides even more support (if it were needed) for the growing demand not just to regulate private data hoarders or distribute some of their revenue to users, but to take user data out of the hands of private corporations altogether. The so-called decentralized internet has increasingly been proposed as a non-legislative solution, with bitcoin and other blockchain applications as something of a model. One specific effort is to reduce Facebook and Google’s power by establishing a decentralized public standard for online identity.

The documents’ new insights are also very relevant to Facebook’s reported efforts to build its own “cryptocurrency.” They show in greater detail how unconcerned Facebook leadership is with user privacy or other protections, reinforcing our skepticism that a Facebook digital currency would share any of the anti-censorship or privacy benefits of true cryptocurrency. Instead, it now seems clearer than ever, such a product would help a handful of individuals consolidate even more power to coerce their enemies and reward their friends—using the rest of us as convenient pawns.