As Senator Amy Klobuchar (D-MN) continues to seek supporters for her so-called platform antitrust bills, including by offering largely symbolic “revisions” (we remain unconvinced), some unlikely (though not entirely unexpected) allies are emerging from the woodwork. Though Senator Klobuchar often claims that the purpose of the bills is to knock big tech platforms down a peg, Facebook’s recent filing to the National Telecommunications Information Administration (NTIA) in response to the agency’s Request for Comments on Competition in the Mobile App Ecosystem makes it clear that many of the provisions in her legislation would offer precisely the remedy Facebook needs to rebuild its faltering data collection empire. It confirms what we’ve been saying for months now: that some of the least privacy protective platforms in the world stand to gain immensely if these bills were to pass.
ACT | The App Association has repeatedly warned that the overbroad scope of Senator Klobuchar’s legislation would allow bad, data-hungry actors to evade platform protections that prevent surveillance of users across apps and would provide unconditional access to device software, hardware, or operating system features, even when those entities have proven themselves unworthy of trust. We’ve pointed out that both the Open App Markets Act (S. 2710) and the American Choice and Innovation Online Act (S. 2992) would undermine common-sense protections in the app stores that ensure a trusted ecosystem for our member companies to develop and market their products to users. Perhaps most importantly, we’ve called on Congress to pass comprehensive privacy legislation to ensure that a strong and consistent standard for privacy protection exists in the United States.
In what amounts to a full-throated endorsement of many of the principles captured in Senator Klobuchar’s legislation, Facebook’s NTIA comments made it plainly obvious that they support platforms opening unfettered access to consumers’ information for one very simple reason: it makes them a ton of money. Facebook, an enormous platform in its own right, repeatedly complained in the filing that certain app platform behavior hurts its bottom line. Chief among its complaints was that Apple’s App Tracking Transparency (ATT) policy has cut off a key data pipeline that it used to target personalized ads to users and to assess their efficacy. Remember, ATT requires app developers to simply ask permission before they combine information from third-party apps and websites with their own data to serve users targeted advertisements. Unsurprisingly, the vast majority of users have denied Facebook the opportunity to surveil them across the internet, thus illustrating the essence of Facebook’s issue: users don’t find its surveillance practices very palatable when given the choice.
According to internal forecasts, Facebook is set to lose $10 billion in advertising this year due to the change. At the same time, privacy advocates have lauded the introduction of ATT, while other platforms have scrambled to institute similar changes. Facebook’s comments to NTIA underscore why we’ve steadfastly made calls for Congress to enshrine a national privacy law before passing antitrust legislation – opening the door for companies to access consumer data without a privacy backstop means additional opportunities for unwanted third-party sharing, unexpected processing activities, and extensive user profiling. Meanwhile, Facebook sees Senator Klobuchar’s bills as an opportunity to fend off intermediaries that prevent it from undertaking these activities and lock them in as statutorily sanctioned “pro-competitive” behaviors. Unwinding all of this later would only make the job of privacy bill negotiators in the Senate Commerce and House Energy and Commerce Committees harder.
The self-serving nature of this filing leads Facebook to several disingenuous conclusions. Facebook claims that the introduction of ATT is forcing smaller app developers to find alternative ways to monetize given the downturn in ad effectiveness. However, the only evidence they cite actually finds that just .049 percent of apps have monetized since the introduction of ATT – hardly a major disruption in developer business models. Now compare that marginal impact with the $10 billion Facebook is set to lose through this change and the origin of Facebook’s complaint becomes much clearer (if there was any doubt in the first place).
At the same time that Facebook claims that app platforms should be forced to allow third parties to collect as much data as they please, when it comes to the potential interoperability of its own service, Facebook sings a much different tune. It claims that “providing access for rivals” through the forced inoperability of social media platforms that could allow users to port their Facebook data to other services would create “complex trade-offs” around “innovation” and “competition” and, most gallingly of all, “security” and “privacy.” While Facebook has no problems pushing for its business rivals to provide them access to consumer data, when it comes to their own service, suddenly security and privacy are of paramount importance.
What this squabble between Facebook and the app platforms really reveals is that much of the support for the platform competition bills comes from large players seeking workarounds so they can make more money. Meanwhile, smaller players, such as our member companies, would be hurt as trust in the app ecosystem diminishes. When users’ information is misused and they encounter increasing security breaches, they will likely reduce their consumption of apps to the bare essentials and markets often already controlled by the bigger brands.
That’s why our members traveled to Capitol Hill last week to advocate that Congress forego S. 2710 and S. 2992 and instead rekindle privacy legislation. It is crucial for them that we defeat these bills and retain the innovative app marketplace that has served them so well to date.