Reference no: EM132961541

Assignment Instructions

You must read thoroughly the compiled article below, then answer ALL the following questions.

Facebook - Data Privacy Dilemma

In 2018, Facebook founder and CEO Mark Zuckerberg came under fire from lawmakers, testifying before a U.S. congressional hearing, for the Facebook data-privacy dilemma that angered many users, causing panic in the stock market and intense inquiries from lawmakers and regulators worldwide. Cambridge Analytica, a U.K.-based political data analytics firm, illicitly procured the data of 50 million Facebook users, without their knowledge or consent.

In an interview with MSNBC, Apple CEO Tim Cook criticised Facebook's handling of the situation and argued that Apple could "make a ton of money" if it chose to monetize its customers' data. "This is not something that we just started last week when we saw something happening. We've been doing this for years".

In response, Facebook detailed several steps it's taking to set things right. It said it would investigate all apps that had access to large amounts of information prior to 2014. Further, it announced new plans for restrictions on developers' data access, adopting tougher policies and terms for third-party app developers, shutting down certain programs, updating its privacy tools that were designed to make them easier to find and use, including an easier to use data management tool called ‘Access Your Information' to provide a simpler way for users to manage, delete or download their posts or personal profile info, plus enabling users to easily see info that the company uses to serve targeted advertising.

Consequently, Facebook and other technology companies will be obliged and forced to comply with stricter European privacy protections. The European Union's General Data Protection Regulation (GDPR), which came into effect May 25 2018, required companies to obtain consent before collecting data from consumers. It also gave consumers the right to learn what companies know about them and even ask a company such as Facebook to delete photos or any other data it may have. While that, GDPR technically applies only to services offered to EU residents, given the global nature of many online services and the increased focus on privacy, some of the new rules could apply to U.S. users. It's important to mention here that GDPR, was first drafted in early 2012, passed despite heavy lobbying against it by big tech companies.

Facebook tracks both its users and nonusers on other sites and apps. It collects biometric facial data without users' explicit "opt-in" consent. Facebook uses artificial intelligence to analyse users' behaviour. For example, among many possible target audiences, Facebook may offer advertisers 1.5 million people "whose activity on Facebook suggests that they're likely to engage with/distribute liberal political content" and nearly seven million Facebook users whom for example, prefer certain goods in certain countries. Facebook uses software tools for tracking activities. For example, when internet users go to other sites, Facebook may still monitor their activities with software like its ubiquitous "Like" and "Share" buttons, and something called Facebook Pixel - invisible code that's dropped onto the other websites that allows that site and Facebook to track a user's activities.

Not only, Facebook mine information about users, but in fact many other companies, do similar activities, such as for examples, news organizations like The New York Times. The reason that Facebook was singled out for such practices, it was due to being a market leader and its stockpiling of personal data is at the core of its $40.6 billion annual business. Despite that Facebook requires

outside sites that use tracking technologies to clearly notify Facebook users, and allows them to opt out of seeing ads based on their use of those apps and websites, that did not stop angry users from raising their concerns over Facebook's practices. Facebook stresses that, when users sign up for an account, they must agree to the company's data policy. It plainly states that its data collection "includes information about the websites and apps users visit, users' use of their services on those websites and apps, as well as information the developer or publisher of the app or website provides to them or Facebook." But in Europe, some regulators contend that Facebook does not obtain users' explicit and informed consent to track them on other sites and apps. Their general concern, was that, many of Facebook's 2.1 billion users had no idea how much data Facebook could collect about them and how the company could use it. And there is a growing unease that tech giants are unfairly manipulating users.

To assure and deal with consumers and regulators' discomfort and anger over the amount of personal data that Facebook collects, Facebook announced an extended data privacy feature in the F8 Conference May 2018 called the "Clear History," feature for users to view what apps and websites they interacted with on Facebook, allow them to clear their browsing history on Facebook (eg. what they clicked on, websites they visited, etc.) as well as allowing them to bar the social network from collecting it again moving forward.

Question 1. Based on the compiled article above, explain the steps Facebook took to overcome its data privacy crisis. Explore the ‘Data Policy' section on Facebook.com, and explain how a user can manage or delete his/her own information?

Question 2. Search the Web for the GDPR, then answer the following questions: Explain the purpose of GDPR. Describe at least three the key privacy and data protection requirements of the GDPR.

Question 3. Describe Facebook's e-business model and revenue model. Discuss Facebook's business benefits and challenges.

Question 4. Evaluate in general terms, the challenges facing social networking websites and identify ways companies can prepare to face these issues.