FTC Requests Nine Social Media Companies Disclose Information About Data Collection, Advertising

On Monday, the Federal Trade Commission (FTC) announced that it issued orders pursuant to Section 6(b) of the FTC Act, which gives the agency the authority to conduct studies that do not have specific law enforcement purposes, to nine social media companies including Amazon.com, Inc., Discord Inc., Facebook, Inc., Reddit, Inc., Twitter Inc., WhatsApp Inc., YouTube LLC, and Snap Inc., as well as ByteDance Ltd. which operates TikTok.

The FTC’s orders require the companies to “provide data on how they collect, use, and present personal information, their advertising and user engagement practices, and how their practices affect children and teens.” In particular, the FTC is seeking information about: “how social media and video streaming services collect, use, track, estimate, or derive personal and demographic information”; “how they determine which ads and other content are shown to consumers”; “whether they apply algorithms or data analytics to personal information”; “how they measure, promote, and research user engagement”; and “how their practices affect children and teens.”

The FTC voted 4-1 to issue the orders. Commissioners Rohit Chopra, Rebecca Kelly Slaughter, and Christine S. Wilson issued a statement in support of the orders, finding it timely and important to answer various questions and concerns. The Commissioners stated that “(d)espite their central role in our daily lives, the decisions that prominent online platforms make regarding consumers and consumer data remain shrouded in secrecy. Critical questions…have gone unanswered… Never before has there been an industry capable of surveilling and monetizing so much of our personal lives.”

The Commissioners added that today’s orders are a “step toward getting much-needed clarity.” Moreover, the Commissioners stated that the study “will lift the hood on the social media and video streaming firms to carefully study their engines. As concerns mount regarding the impact pf the tech companies on Americans’ privacy and behavior, this study is timely and important.” For example, in September Twitter was sued over its misrepresentations about users’ control over their phone numbers; Facebook, was sued for biometrics privacy violations, Instagram, which is owned by Facebook was sued for unauthorized access to users’ cameras and real time data, TikTok’s numerous privacy suits were consolidated in a multidistrict litigation, and Amazon was accused of misappropriating merchant data.

However, Commissioner Noah Joshua Phillips voted against the orders, stating that the orders do not fit their intentions. In his dissenting statement, Phillips stated, “The 6(b) orders are instead an undisciplined foray into a wide variety of topics, some only tangentially related to the stated focus of this investigation. The actions undertaken today trade a real opportunity to use scarce government resources to advance public understanding of consumer data privacy practices—critical to informing ongoing policy discussions in the United States and internationally—for the appearance of action on a litany of gripes with technology companies.”