June 20, 2018

At Senate Commerce Committee Hearing on Cambridge Analytica and Facebook, Senator Hassan Highlights Tension Between Facebook’s Business Model and Consumer Protections

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Click here for footage of the Senator’s questions. 

WASHINGTON – Senator Maggie Hassan yesterday highlighted the inherent conflict between privacy and profitability at companies such as Facebook that sell user data as part of their business model during a Commerce, Science, and Transportation Committee hearing today.

Witnesses at yesterday’s hearing included Aleksandr Kogan who founded the company Global Science Research and created an app that collected data from approximately 87 million Facebook users and transferred that data to Cambridge Analytica who used this data for political targeting purposes. The other witnesses were Ashkan Soltani, former Chief Technologist of the FTC, and John Battelle, Founder of Wired.

The hearing focused on Cambridge Analytica and other Facebook partners, following-up on a previous joint full committee hearing with Facebook CEO Mark Zuckerberg and focusing on the collection and use of social media data and privacy concerns that rose out of the Cambridge Analytica/Facebook scandal earlier this year. At that hearing, Senator Hassan pressed Mr. Zuckerberg on his company’s business model, which as Senator Hassan stated, “relies on two potentially problematic foundations; maximizing the amount of time people spend on the site and collecting user data.” 

At yesterday’s hearing, Senator Hassan highlighted her concerns with Facebook’s business model and noted that in their testimony, all three witnesses “independently referenced problems inherent in Facebook’s business model.” Senator Hassan asked witnesses to expand on their testimony and invited them to “comment broadly on the inherent problems with Facebook’s business model and whether they require legislators to create some level of guardrails to protect consumers, including strong financial penalties to change these companies economic incentives.”

Dr. Kogan responded, stating, “I think it’s pretty clear that Facebook is in the business of trying to keep you on Facebook as long as possible, because then they can serve you more ads…the model does run counter to not only our privacy but our well-being because the more you’re spending time on your phone the less time you’re spending  in nature, or doing meaningful work, or interacting with people in a more genuine way. I think that’s all concerning…the Facebook platform has been set up in a way that runs counter to true and informed consent and folks aren’t being given the ability to choose wisely.”

Mr. Soltani replied, “I think absolutely policy interventions are important here…I worry a little bit about focusing on consent a bit too much because it’s hard to have meaningful consent if you predicate access to this service based on that consent…I think focusing too much on just notice and giving consumer’s choice, is kind of like food safety. So we can give people choices, but food can’t contain arsenic. I think the same is true for this space. We need to give them choices, but we need some baseline protections.” 

Mr. Battelle said, “The advertising model that Facebook, to your question Senator, that Facebook employs is not new to Facebook. What’s new is how good they are at employing it. I think what has been revealed in this Cambridge story is how little consumers understand that model and frankly how little regulators do. I think we need to educate ourselves.”