Advocates Ask FTC to Investigate Social Networking Ad Plans

Two consumer advocacy groups have asked the Federal Trade Commission to investigate whether new advertising initiatives announced last week by social networking sites MySpace and Facebook adequately protect consumer privacy.

In a Nov. 12 letter to FTC Chairman Deborah Platt Majoras, the Center for Digital Democracy and the U.S. Public Interest Research Group claimed that the "ambitious new targeted advertising schemes" launched by MySpace.com and Facebook Inc. "make clear the advertising industry's intentions to move full-speed ahead without regard to ensuring consumers are protected."

Jeffrey Chester, founder and executive director of the Center for Digital Democracy, said that by launching the advertising plans, MySpace and Facebook are "thumbing their noses at the FTC and consumer privacy rights" by allowing marketers to customize advertisements based on data provided by users in their profiles on the social networking sites.

"MySpace and Facebook are like the digital data equivalent of Fort Knox for Madison Avenue marketers," he said. "It is a kind of one-stop data shop for marketers. They know your interests, your politics and what movies you like. It is a much more rich array of content that marketers simply should not have automatic access to."

Chester said that consumers must be offered a complete opt-out option, and that the social networks must fully disclose how they intend to use their personal information.

The letter goes on to note that since both MySpace and Facebook are working with fast-food advertisers, the FTC should include their plans in its ongoing review of advertisements that may promote obesity among youths.

Several attorneys and privacy advocates last week questioned whether it is legal for the social networks to tell a user's friends about his or her purchases or likes without the user's written consent.

In a statement e-mailed to Computerworld, MySpace said it is "firmly committed to protecting user privacy and adher[ing] to a strict policy." In addition, MySpace noted that by the end of this year, users will be able to opt out of MySpace programs that use their preferences to help advertisers create customized ads.

"Our ad targeting platform is designed to work with user-expressed information from profile pages to create a more-relevant advertising experience," the statement said. "Users who are not interested in participating will have the ability to 'opt out' of the targeting platform."

Facebook did not immediately respond to a request for comment.

This week's letter was a follow-up to a report the two groups sent to the FTC in early November urging it to launch an investigation into new threats to privacy from the behavioral targeting and profiling of users -- especially youth -- by social networks and other online sites.