Facebook Struck Secret Deals To Sell Preferential User Data; Used VPN App To Spy On Competitors

Update: As the giant cache of newly released internal emails has also revealed, Karissa Bell of Mashable notes that Facebook used a VPN app to spy on its competitors.

The internal documents, made public as part of a cache of documents released by UK lawmakers, show just how close an eye the social network was keeping on competitors like WhatsApp and Snapchat, both of which became acquisition targets.

Facebook tried to acquire Snapchat that year for $3 billion — an offer Snap CEO Evan Spiegel rejected. (Facebook then spent years attempting, unsuccessfully, to copy Snapchat before finally kneecapping the app by cloning Stories.)

Facebook’s presentation relied on data from Onavo, the virtual private network (VPN) service which Facebook also acquired several months later. Facebook’s use of Onavo, which has been likened to “corporate spyware,” has itself been controversial.

The company was forced to remove Onavo from Apple’s App Store earlier this year after Apple changed its developer guidelines to prohibit apps from collecting data about which other services are installed on its users’ phones. Though Apple never said the new rules were aimed at Facebook, the policy change came after repeated criticism of the social network by Apple CEO Tim Cook. –Mashable

A top UK lawmaker said on Wednesday that Facebook maintained secretive “whitelisting agreements” with select companies that would give them preferential access to vast amounts of user data, after the parliamentary committee released documents which had been sealed by a California court, reports Bloomberg.

The documents – obtained in a sealed California lawsuit and leaked to the UK lawmaker during a London business trip, include internal emails involving CEO Mark Zuckerberg – and led committee chair Damian Collins to conclude that Facebook gave select companies preferential access to valuable user data for their apps, while shutting off access to data used by competing apps. Facebook also allegedly conducted global surveys of mobile app usage by customers – likely without their knowledge, and that “a change to Facebook’s Android app policy resulted in call and message data being recorded was deliberately made difficult for users to know about,” according to Bloomberg.

In one email, dated Feb. 4, 2015, a Facebook engineer said a feature of the Android Facebook app that would “continually upload” a user’s call and SMS history would be a “high-risk thing to do from a PR perspective.” A subsequent email suggests users wouldn’t need to be prompted to give permission for this feature to be activated. –Bloomberg

The emails also reveal that Zuckerberg personally approved limiting hobbling Twitter’s Vine video-sharing tool by preventing users from finding their friends on Facebook.

In one email, dated Jan. 23 2013, a Facebook engineer contacted Zuckerberg to say that rival Twitter Inc. had launched its Vine video-sharing tool, which users could connect to Facebook to find their friends there. The engineer suggested shutting down Vine’s access to the friends feature, to which Zuckerberg replied, “Yup, go for it.”

“We don’t feel we have had straight answers from Facebook on these important issues, which is why we are releasing the documents,” said Collins in a Twitter post accompanying the published emails. –Bloomberg

Thousands of digital documents were passed to Collins on a London business trip by Ted Kramer, founder of app developer Six4Three, who obtained them during legal discovery in a lawsuit against Facebook. Kramer developed Pikinis, an app which allowed people to find photos of Facebook users wearing Bikinis. The app used Facebook’s data which was accessed through a feed known as an application programming interface (API) – allowing Six4Three to freely search for bikini photos of Facebook friends of Pikini’s users.

Facebook denied the charges, telling Bloomberg in an emailed statement: “Like any business, we had many of internal conversations about the various ways we could build a sustainable business model for our platform,” adding “We’ve never sold people’s data.”

A small number of documents already became public last week, including descriptions of emails suggesting that Facebook executives had discussed giving access to their valuable user data to some companies that bought advertising when it was struggling to launch its mobile-ad business. The alleged practice started around seven years ago but has become more relevant this year because the practices in question — allowing outside developers to gather data on not only app users but their friends — are at the heart of Facebook’s Cambridge Analytica scandal.

Facebook said last week that the picture offered by those documents was misleadingly crafted by Six4Three’s attorneys. –WaPo

“The documents Six4Three gathered for this baseless case are only part of the story and are presented in a way that is very misleading without additional context,” said Facebook’s director of developer platforms and programs, Konstantinos Papamiltiadis, who added: “We stand by the platform changes we made in 2015 to stop a person from sharing their friends’ data with developers. Any short-term extensions granted during this platform transition were to prevent the changes from breaking user experience.”

Kramer was ordered by a California state court judge on Friday to surrender his laptop to a forensic expert after he admitted giving the UK committee the documents. The order stopped just short of holding the company in contempt as Facebook had requested, however after a hearing, California Superior Court Judge V. Raymond Swope told Kramer that he may issue sanctions and a contempt order at a later date.

“What has happened here is unconscionable,” said Swope. “Your conduct is not well-taken by this court. It’s one thing to serve other needs that are outside the scope of this lawsuit. But you don’t serve those needs, or satisfy those curiosities,when there’s a court order preventing you to do so.”

Trouble in paradise?

As Facebook is now faced with yet another data harvesting related scandal, Buzzfeed reports that internal tensions within the company are boiling over – claiming that “after more than a year of bad press, internal tensions are reaching a boiling point and are now spilling out into public view.”

Throughout the crises, Facebook’s CEO Mark Zuckerberg, who maintains majority shareholder control, has proven remarkably immune to outside pressure and criticism — from politicians, investors, and the press — leaving his employees as perhaps his most important stakeholders. Now, as its stock price declines and the company’s mission of connecting the world is challenged, the voices inside are growing louder and public comments, as well as private conversations shared with BuzzFeed News, suggest newfound uncertainty about Facebook’s future direction.

Internally, the conflict seems to have divided Facebook into three camps: those loyal to Zuckerberg and chief operating officer Sheryl Sandberg; those who see the current scandals as proof of a larger corporate meltdown; and a group who see the entire narrative — including the portrayal of the company’s hiring of communications consulting firm Definers Public Affairs — as examples of biased media attacks. –Buzzfeed

“It’s otherwise rational, sane people who’re in Mark’s orbit spouting full-blown anti-media rhetoric, saying that the press is ganging up on Facebook,” said a former senior employee. “It’s the bunker mentality. These people have been under siege for 600 days now. They’re getting tired, getting cranky — the only survival strategy is to quit or fully buy in.”

A Facebook spokesperson admitted to BuzzFeed that this is “a challenging time.”

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