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FTC Investigating Video Streamer, Social Media Data Practices

An exterior view of the Federal Trade Commission building
(Image credit: Future)

The Federal Trade Commission is launching a wide-ranging investigation into how video streamers and social media companies collect data and use it to target advertising to consumers.

The FTC said it has issued orders to nine such companies "requiring them 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."

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The orders are going to Amazon, ByteDance (TikTok), Discord, Facebook, Reddit, Snap, Twitter, WhatsApp (Facebook), and YouTube (Google). They have 45 days to respond.

The FTC wants answers on:

1. "How social media and video streaming services collect, use, track, estimate, or derive personal and demographic information;

2. "How they determine which ads and other content are shown to consumers;

3. "whether they apply algorithms or data analytics to personal information;

4. How they measure, promote, and research user engagement; and

5. How their practices affect children and teens.

The vote to launch the investigation was 4-1, with Commissioner Joshua Phillips, a Republican, voting no and calling the orders "an undisciplined foray into a variety of topics, some only tangentially related to the stated focus of this investigation."

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Sen. Ed Markey (D-Mass.), who has made data privacy a signature issue, was pleased.

“Social media platforms and video streaming services are daily destinations for young people today,” said Markey, who is a member of the Commerce Committee. “Unfortunately, parents and policymakers alike are in the dark about how powerful websites and apps are siphoning kids’ and teens’ personal information, profiling users, and raking in profits while children get hooked on their devices. No comprehensive investigation of these websites would be complete without special attention to children and teens, a uniquely vulnerable population online. I am glad that the FTC heeded my calls to issue these orders, and I thank my bipartisan partners who joined me in advocating for this investigation.”

“As I have impressed upon Chairman Simons in the past, an effort by the FTC to systematically study the data collection and business practices of the largest technology platforms is long overdue," said Sen. John Warner (D-Va.). "Policymakers and regulators – not to mention consumers – are totally in the dark about how their data is being collected and monetized; about the metrics used to measure their attention, engagement, and value to the platform; and about the ways in which these platforms design their products to maximize data collection, ad revenue, and user engagement. I applaud Chairman Simons and the Commission for this important step in bringing sunlight to what has far too long been an opaque market, vulnerable to abuse, digital ad fraud, and consumer harm.”