Social media websites including Facebook and Twitter have recently started new marketing strategies that use members’ information to provide more personalized advertisements meant to mimic word-of-mouth recommendations. However, many concerns about privacy are raised when members’ names, photos, and comments are exposed to everyone when they were meant to be shared with only a select group of people.
With the settlement, Facebook agreed to change their Statement of Rights and Responsibilities.
Sponsored Stories from Facebook
In January 2011, Facebook launched an advertising program called Sponsored Stories, where the website used members’ names, profile photos, and “likes” to endorse ads without asking its users’ permission or providing an option to “opt out.” Three months later, two lawsuits were filed against Facebook’s Sponsored Stories. A citizen in California alleged that the company violated the state’s right to publicity law and its unfair competition statute, while an Illinois resident alleged that the program used minors’ personal information.
In December 2011, a class action lawsuit was filed, and by the summer of 2012, Facebook proposed a $20 million settlement. The initial settlement proposal would split the funds between attorneys’ fees and a “cy pres” payment given to organizations advocating for privacy rights on social media sites; however, this settlement did not provide monetary relief for class members. In a second proposal, users whose images appeared in Sponsored Stories could collect up to $10 each – a fair amount, according to the judge, seeing as it was difficult to prove Facebook members were financially harmed or that, by “liking” products, users didn’t imply some form of consent.
Although millions of class members were expected to file claims, only about 600,000 members responded to class action notifications sent out by Facebook, so the extra awards allowed them to collect $15 each. With the settlement, Facebook agreed to change their Statement of Rights and Responsibilities and give members better control over how their information is used within the Sponsored Stories program.
Shared Endorsements from Google+
In October 2013, Google+ put up an alert on members’ home pages to notify them that Google+ would be reviewing their terms of service, and starting November 11, 2013, the site would begin using members’ information in ads through a program called Shared Endorsements. Users’ information, including names, profile photos, ratings, and reviews, will be seen on Google’s own site in addition to millions of other websites that are part of Google’s advertising network. Previously, if a Google+ user clicked a “+1” button – the site’s equivalent to Facebook’s “like” button – for a product, their endorsement may have appeared in an ad. Now, Google+ is trying to expand these endorsements by including things like song ratings in the Google Store, or restaurant reviews posted to Google+. In the alert, Google+ provided examples for users to see how the system might work by showing users’ faces or comments below Street View images of places, or search results for products. Although Google+ claims that they have made it easy for users to opt out of the system, they have warned users that, by doing so, some comments or product follows may no longer be visible to friends.
The advertising programs from Facebook and Google+ are quite similar, and with premature opposition from Google+ members, could a class action be brewing?