Facebook's Data Privacy Controversies

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Case Details:

Case Code : BECG101
Case Length : 23 Pages
Period : 2004-2009
Pub Date : 2009
Teaching Note :Not Available
Organization : Facebook.com
Industry : Internet and e-Commerce
Countries : US

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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"We learned many lessons about the importance of user education and extensive control from the imperfect introduction of our Beacon product in 2007. As a result, Facebook continues to be dedicated to empowering consumers to control their information in both the noncommercial and the commercial context because we believe that should be the future of advertising." ¹

- Chris Kelly, Chief Privacy Officer, Facebook Inc., in June 2009.

"The EU data-protection laws make it more difficult for Facebook and others to operate in the EU than elsewhere."²

- Jan Dhont, Data-Privacy Lawyer at Lorenz³ in Brussels, in June 2009.

Introduction

On June 12, 2009, the members of the Article 29 Data Protection Working Party⁴ issued guidelines about how social networking sites in Europe could maintain high standards in ensuring privacy. In order to strengthen privacy laws, it issued guidelines which social networking website operators were asked to emphasize on offering privacy-friendly default settings - advising users that pictures should only be uploaded with the individual's consent; setting maximum periods to retain data on inactive users and deleting abandoned accounts; and allowing users to adopt a pseudonym.⁵

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1] Caroline McCarthy, "Facebook: Our Targeted Ads Aren't Creepy," http://www.cnet.com, June 18, 2009.
2] Matten Dalton, "EU Lays out Web Privacy Rules," http://online.wsj.com, June 24, 2009.
3] Lorenz is an international law firm. It has offices in Brussels, Bishkek and Geneva.
Source: www.mait.com (Accessed on May 5, 2009).
4] Article 29 Data Protection Working Party is a "Working Party on the Protection of Individuals with regard to the processing of Personal Data". The party comprises of a representative from the data protection authority of each EU Member State (including the Irish Data Protection Commissioner), the European Data Protection Supervisor and the EU Commission. The Working Party is independent and acts in an advisory capacity (Source: http://www.dataprotection.ie).
5] Matten Dalton, "EU Lays out Web Privacy Rules," http://online.wsj.com, June 24, 2009.

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