• The FTC urges Congress to limit data collection by social media and streaming platforms, citing vast surveillance practices.

• The regulator criticizes companies for inadequate privacy controls and failures in protecting young users.

• These surveillance practices can endanger people’s privacy, threaten their freedoms, and expose them to a host of harms, from identify theft to stalking, according to FTC Chair Lina Khan.

The Federal Trade Commission (FTC) is calling on Congress to enact comprehensive privacy legislation aimed at curbing the excessive data collection practices of major social media companies and video streaming platforms, according to Law.com. 

In a recent report, the FTC highlighted the extensive surveillance conducted by these platforms, which often collect vast amounts of user data without sufficient transparency or protections. Companies used this data to create targeted advertising toward consumers, and these practices also failed to protect children and teens, the report stated. 

Key Findings

The 129-page report, which FTC voted unanimously to release, included companies such as Amazon.com Inc. (owner of Twitch), ByteDance Ltd. (operator of TikTok), Discord Inc., Facebook Inc., Reddit Inc., Snap Inc., Twitter Inc. (now X), WhatsApp Inc. and YouTube LLC. 

The study addresses companies’ practices from January 2019 to December 2020. 

• The report found that most platforms did not delete inactive or abandoned user accounts. And while they only retained data for legitimate business purposes, that policy often resulted in retaining data indefinitely.

• The study did not provide company-specific details, instead looking broadly on platforms’ general practices for collecting and monetizing user data, including for targeted advertising. 

• The study found widespread use of algorithms, data analytics, and artificial intelligence to infer details about users’ personal lives and recommend content for those users. 

• The companies were also found to have collected data on non-users, often obtained through third parties like data brokers.

• When it comes to children and teens, the report found that these companies largely treat teens like adults and “bury their heads in the sand when it comes to children using their services” by suggesting that they had no child users on their platforms because they do not allow children to create accounts.

• The report criticized companies for not making clear to consumers that their data was being used for targeted advertising. “The lack of transparency and lack of consumer awareness and understanding poses concerns and suggests users do not understand how much privacy they are giving up, largely to facilitate targeted advertising, when using the services of the companies.”

Response

Asked to comment on the findings, several companies, such as Discord, said the report explores an important topic but noted that data-retention and data-minimization practices vary across companies and defended their own privacy protections. 

• Discord has a very different business model and it does not run a forma digital advertising service, said the company’s head of public policy in the U.S. and Canada, Kate Sheerin.

• Interactive Advertising Bureau CEO David Cohen said the group is “disappointed with the FTC’s continued characterization of the digital advertising industry as engaged in ‘mass commercial surveillance.’” 

• Google told Law.com that it has the strictest privacy policies in their industry. “We never sell people’s personal information, and we don’t show personalized ads based on sensitive information,” spokesperson José Castañeda said. “We also prohibit ad personalization for users under 18, and we don’t serve personalized ads on ‘made for kids content’ on YouTube, regardless of who is watching.”

“Self-Regulation Has Been a Failure”

“The absence of legislation has given firms nearly free rein in how much they can collect from users,” the report added. “Two decades ago, some believed that large tech companies could be trusted to establish adequate privacy standards and practices. This report makes clear that self-regulation has been a failure.” 

In a separate statement, FTC Chair Lina Khan said that while lucrative for companies, these surveillance practices can endanger people’s privacy, threaten their freedoms, and expose them to a host of harms, from identity theft to stalking. 

“Several firms’ failure to adequately protect kids and teens online is especially troubling,” she said. “The Report’s findings are timely, particularly as state and federal policymakers consider legislation to protect people from abusive data practices.”