Germany says 'nein' to Facebook's heavy-handed data collection in landmark ruling

Video AP

Video AP

Germany's antitrust watchdog has banned Facebook from combining data collected from its social platforms without user consent.

Among other conditions, private use of the network is subject to Facebook being able to collect an nearly unlimited amount of any type of user data from third party sources, allocate these to the users' Facebook accounts and use them for numerous data processing processes.

Germany's competition regulator has told Facebook it will have to substantially restrict how it collects and combines data about its users unless they give it explicit consent.

The Cartel's probe, which follows a number of high-profile privacy screw-ups at Facebook, concluded that the firm has a "dominant" position in social networking in Germany, with its 23 million daily active users representing 95 per cent of the market; this means that "Facebook's conduct represents above all a so-called exploitative abuse", the authority said. "That poses questions in terms of privacy - and of cybersecurity", as that will be a single point of vulnerability for hackers to target in an attempt to gain social network users personal data from all the platforms, the report stated.

Linking user data from Facebook with their web-surfing matters because it helps Facebook see what people are interested in and what they buy, information that makes its ads particularly valuable.

Federal Cartel Office (FCO), has granted Facebook one month time to act upon it.

Facebook has appealed the decision, saying the regulator underestimated the competition it faced, and had not considered a Europe-wide privacy rule that took effect past year. The decision is not about Facebook's processing of data generated by its own site, which the Cartel Office acknowledged is the business model for data-based social networks like Facebook.

It covered data gathered from third-party sources as well as via Facebook's other apps, including Instagram.

"The European legislator has made sure that there is now a regulation in place that addresses this type of conduct, namely the General Data Protection Regulation (GDPR)", it added.

Data can only be assigned to Facebook from WhatsApp and Instagram with the user's voluntary consent, the Bundeskartellamt said in a press release.

But the UK-based campaign group Privacy International has said that if the German ruling holds, Facebook should extend the same rights to its other users.

But Thibault Schrepel, an assistant law professor at the University of Utrecht in the Netherlands, said the German decision "deviates from the usual standards of competition law" by not explaining why Facebook's market power lets it collect the data or how that creates "data barriers to entry" that shut out potential rivals, The authority is claiming to protect consumers from the company's data collection when "in fact, it seems they benefit from this".

It is worth to mention that in the last June, 2.5 billion people used at least one of Facebook apps: Facebook, Instagram, WhatsApp or Messenger. As a dominant market player, Facebook is "subject to special obligations under competition law", the regulator said. "Users are often unaware of this flow of data and can not prevent it if they want to use the services".

The ruling only applies to the firm's activities in Germany, but is likely to influence other regulators. They're simply using their data sharing methods to protect you against terrorism and child abuse, according to Facebook.

The regulator said it had not included services such as Snapchat, YouTube or Twitter, and professional networks like LinkedIn and Xing, as being in the market it has considered Facebook to be dominant in because they "only offer parts of the services of a social network and are thus not to be included in the relevant market".

That data then provides the foundation for Facebook's advertising profits.

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