Brief:
- Facebook changed its statement about the kinds of information the social networking giant collects about users of its Portal video-chat device that was introduced last week. While the device currently doesn't show ads, the company may use the information about Portal usage for ad targeting on its other platforms, a Facebook spokesperson told Recode.
- Facebook last week highlighted the privacy features of the Portal, saying that it doesn't listen to, view or keep the contents of video calls, which are encrypted for security. However, because the Portal is built upon the Facebook Messenger chat platform, the company collects information about app usage and call length and frequency.
- In addition, Facebook is said to be building a camera-equipped device that viewers attach to their TVs. The device, codenamed "Ripley," would let users make video calls, similar to what Portal offers, and watch streaming video services, per Cheddar. Facebook may introduce the device next year.
Insight:
Facebook's about-face on how it will use data collected from Portal users is noteworthy because the company is already under scrutiny over its data practices and is the latest development to that raise questions about how much Facebook understands about how data is being applied across a widely used platform that includes a growing number of properties. For marketers, if consumers don't trust Facebook, this could impact the effectiveness of their ads. While ad spend on Facebook has rebounded following the Cambridge Analytica scandal, ROI has dropped, in part because consumers are more suspicious of brands advertising on Facebook, per a report from C3.
Facebook was already facing significant obstacles with its entry into the highly competitive in-home smart device market, and this news is likely to do little to ensure consumers and marketers that personal data is being safeguarded. Facebook this year has taken steps to improve its data privacy disclosures after the Cambridge Analytica scandal revealed that Facebook exposed the personal data of about 87 million people to a political advertising firm working for the Trump campaign.
Facebook last month revealed that the biggest data breach in the company's 14-year history had exposed the personal information of about 50 million users. Even more worrisome, the hack possibly gave attackers access to any website that uses the Facebook login feature, including Instagram, Spotify, Airbnb, Tinder, Pinterest, Expedia and more than 100,000 other places online, per The New York Times. While Facebook said it hadn't seen any evidence that attackers had breached other sites, the incident gave the social network's users another reason to worry about its security and privacy protections.
Concerns about the Portal have been compounded by the privacy issues faced by other smart speaker devices that use voice-enabled digital assistants, especially after incidents like the Amazon Echo device that recorded a couple's private conversation and sent it to a person on their list of contacts.
Facebook's Portal is competing in the growing market for smart displays, which respond to voice commands and let users make video calls, control smart-home devices, watch videos and look up information. They also can show advertising with screensaver-like notifications when they’re not being used, per Digital Trends. While Facebook's Portal currently doesn't show ads, video streams from third-party sources like YouTube may have ad insertions like they do on mobile devices and desktop computers.
