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March 06. 2014 8:29PM

Privacy groups urge FTC to probe Facebook-WhatsApp deal

SAN FRANCISCO — The Electronic Privacy Information Center and the Center for Digital Democracy are urging the Federal Trade Commission to investigate Facebook’s $19 billion acquisition of mobile messaging service WhatsApp.

The privacy groups are asking government regulators to block the proposed acquisition until any privacy issues are resolved.

At issue: Whether Facebook will exploit reams of personal information of WhatsApp’s more than 450 million users to target advertising.

WhatsApp, a 55-person Mountain View, Calif.-based company, has pledged to never run advertising on its service.

“WhatsApp built a user base based on its commitment not to collect user data for advertising revenue,” reads the complaint filed Thursday. “Acting in reliance on WhatsApp representations, Internet users provided detailed personal information to the company including private text to close friends. Facebook routinely makes use of user information for advertising purposes and has made clear that it intends to incorporate the data of WhatsApp users into the user profiling business model. The proposed acquisition will therefore violate WhatsApp users’ understanding of their exposure to online advertising and constitutes an unfair and deceptive trade practice, subject to investigation by the Federal Trade Commission.”

The proposed deal has led to plenty of handwringing. It could also trigger privacy probes in Europe.

Jacob Kohnstamm, who leads a group of EU privacy officials known as the Article 29 Data Protection Working Party as well as the Dutch agency that was already investigating WhatsApp, told Bloomberg the main concern is the collection of data from users’ address books on their phones when they download the application. “It is tempting to use this data” for other purposes, he said.

The company’s “collection of data of people that aren’t using WhatsApp is extreme and is not compliant with Dutch and European law.”

Facebook, a frequent target of European privacy regulators, says WhatsApp will operate independently. WhatsApp has promised users “nothing” will change.

“We are absolutely not going to change plans around WhatsApp and the way it uses user data,” Facebook Chief Executive Mark Zuckerberg said last month. “They might use people and infrastructure to grow, but the vision is to keep the service exactly the same.”

A Facebook spokeswoman reiterated that point in an emailed statement.

“Facebook’s goal is to bring more connectivity and utility to the world by delivering core internet services efficiently and affordably — this partnership will help make that happen. As we have said repeatedly, WhatsApp will operate as a separate company and will honor its commitments to privacy and security,” she said.

Facebook is under a 20-year privacy settlement with the FTC that requires the giant social network to get permission from users before changing the way their personal information is released.


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