The world’s largest social media network has come to an agreement with the Federal Trade Commission regarding accusations of unfair practices, according to The New York Times.
While some might imagine unfair business practices entailed some means of pushing out competitors, the FTC actually took action against Facebook on the basis of consumer privacy concerns.
The agency raised issues such as opening up user information without authorization or notification and changing data security policies without sufficient notice or explanation.
“We’ve all known that Facebook repeatedly cuts corners when it comes to its privacy promises,” Eric Goldman, a law professor at Santa Clara University, told the Times. “Like most Internet companies, they thought they could get away with it. They didn’t.”
The settlement Facebook arranged with the FTC will lead to the company undergoing external privacy audits every two years for the next 20 years. Any later breaches will quickly result in substantial fines.
Despite the undoubted inconvenience of regular audits, Facebook stands to gain from the deal as it prepares for an IPO that could bring in more than $10 billion and any potential investor concerns could cost hundreds of millions.
Nevertheless, Computerworld notes many experts expect Facebook to change only minimally in response to the settlement and believe that the company got off with a relatively light penalty.