The Federal Cartel Office (‘FCO’) of Germany has preliminarily found that Facebook’s Terms of Service are violating competition law. The Office is concerned about the amount of personal data that internet users are expected to give up, just to be on the social media platform.
Let’s be honest. You probably didn’t read Facebook’s Terms of Service when you signed up for the platform. And why should you? As a consumer, you expect that if a company doesn’t behave according to what’s acceptable, a rival will eat them alive. That’s certainly true in most cases, but social media platforms are a bit special. The peculiarity of social media stems from the fact that users can become locked into using them because other people use them too. If you’re not happy with the Facebook Terms of Service, you can’t just simply jump ship. What about all your friends?! For this reason, the German Office examined whether Facebook abused its dominant position through that ‘I agree with the Terms of Service’ checkbox.
Protecting competition on the internet is complex. That’s because online services like Facebook are rarely offered in return for cash. Data is the internet’s preferred payment method. To get Facebook, you have to give up information about you so that ads that appear on your screen can pay for your Facebook ‘subscription’. So the ads for postgraduate degrees on your feed shouldn’t really surprise you a week after you posted a picture of you throwing that hat up in the air. Why, then, is the FCO worried about the fact that Facebook is collecting your data? Well, they don’t really mind about all that data that you’re willingly giving on the Facebook website itself. They worry about all the data that is being collected when you visit other websites that have Facebook add-ons.
When you visit a website, any website, that uses Facebook add-ons like the ‘Facebook like’ button or the ‘Login with Facebook’ button, Facebook collects data about your actions on that website. They then take that data and merge it with your Facebook profile. That’s why Facebook knows much more about you than what you occasionally post on your wall. Ever wonder why Facebook knows you’ve been looking for a new backpack a minute ago? The website you’ve been scrolling through might be using Facebook Analytics. Facebook doesn’t have to ask for your consent to take that data from you. You gave them that consent when you ‘read’ those Terms of Service!
The German Cartel Office thinks that this data collection goes too far. The Office worries that, because accepting the Terms of Service of Facebook is a condition for creating an account and because Facebook has become such a dominant platform online, consumers have no real power to consent to the amount of data that they allow to be taken. As a result, Facebook offers a take-it-or-leave-it deal with no real option to leave. Put simply, in the eyes of the Federal Cartel Office, if data is the currency of the internet, Facebook is charging too much.
Facebook now has the opportunity to offer proposals that address the concerns of the FCO. For more information visit the website of the Bundeskartellamt.