By Joel Schectman
Facebook is installing new controls it says will better inform its members about the way companies are targeting them with advertising, the latest step to quell a public outcry over the company’s mishandling of user data
Starting on July 2, Facebook Inc for the first time will require advertisers to tell its users if a so-called data broker supplied information that led to them being served with an ad. Data brokers are firms that collect personal information about consumers and sell it to marketers and other businesses.
Facebook has also set up new procedures for the handling of names of potential customers supplied by data brokers. Advertisers seeking to upload lists of these prospects onto Facebook’s platform will first have to promise that the data vendor obtained any legally required consent from those consumers.
Facebook says the new policies will create more transparency for its users and require more accountability from advertisers.
“We are not taking a position on whether third-party data is inherently good or bad,” said Graham Mudd, a director of product marketing at Facebook. “We are taking a position on the importance of having the right to use the data and for it to have been sourced responsibly.”
The new policies are the second big push by Facebook this year to shore up its policy regarding data brokers.
On March 28, Facebook moved to banish data brokers from its platform as part of efforts to burnish its image. But the company quickly softened its stance after big marketers threatened to pull their ad dollars from Facebook, according to three people familiar with the decision. Advertisers said the restrictions on data brokers would hurt their ability to aim their ads at customers most likely to buy their products.
Details of advertisers’ pushback, and Facebook’s retreat, have not been previously reported.
A Facebook spokeswoman confirmed that the company shifted its position within days because of “feedback from advertisers.” She said sponsors will still be able to use information purchased from third-party vendors to target Facebook users with ads, albeit under stricter conditions than before.
REPAIRING A REPUTATION
Wednesday’s move is another effort by Facebook to repair its reputation amid a series of scandals. Among the most damaging was the revelation that political consulting firm Cambridge Analytica harvested private information from the Facebook profiles of 87 million people without permission.
In recent public appearances by executives and new television spots, Facebook has been promoting its efforts to keep its users safe and protect their personal information.
But the initiatives present the Menlo Park, CA company with a tricky balancing act. While it is touting greater protections for its users, its advertisers are demanding the ability to target potential customers with ever-greater precision.
“Facebook is caught between tremendous pressures from marketers, and privacy demands from policy makers and the public,” said Kathryn Montgomery, an American University communications professor, who specializes in media and privacy issues.
Data brokers are firms that have made billions of dollars gathering and selling Americans’ personal information, including how much money they earn, what they buy and how many children they have. They get their data from a variety of sources, including public records as well as transaction histories compiled by credit card companies, retailers and other merchants.
Many consumers have no idea they are being tracked in this way. And while the practice is legal in the United States, it has fueled concerns among privacy advocates about the accuracy of this highly personal information, as well as the methods by which it is collected, bought and sold.
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