Facebook is cutting off companies that are in the business of collecting and selling your personal data. These middlemen, often called data brokers, collect and sell data on individuals to advertisers or whoever else might be looking for someone’s personal details, offline shopping history, and online browsing information.
On Wednesday, Facebook announced it is shutting down its Partner Categories program, which for years allowed the company to integrate data brokers into its targeted advertising system, combining details collected from “public records, loyalty card programs, surveys and independent data providers,” as Facebook put it on its website. The Partner Categories program allowed Facebook advertisers to target users based on their activity off Facebook and even offline, like if the user has been shopping for a home or a car.
But now, as Facebook attempts to reassure a public that has become increasingly skeptical of its privacy practices, the company is starting to rein in on how it collects and shares customer data. This of course follows reports earlier this month on how the company allowed app developers to siphon off data of Facebook users without their consent for years—which inappropriately landed the data of more than 50 million users in the hands of a political-data firm used by the Trump campaign, Cambridge Analytica. That loophole was closed in 2014, but a whistleblower who used to work on app security at Facebook spoke to the Guardian last week and said he estimated the number of users affected by the company’s porous data-sharing practices could be in the hundreds of millions.
Facebook said in a blog post Wednesday that its decision to wind down its Partner Categories program, which will happen over the course of six months, is part of its effort to improve user privacy. With the help of data brokers, Facebook advertisers might be able to know if, say, a woman in her 30s used a customer-rewards program to buy high-end sunscreen at a drug store in Los Angeles; later, she might see an ad for skin care products with UV protection from a boutique cosmetics company on her Facebook page.
The decision to remove this layer of customer information for ad targeting could make it even harder for brands that don’t collect detailed customer data as part of their business, like food products or other items typically sold in stores, to continue to target with as much precision. At the same time, Facebook has a hefty amount of data on customers already, and targeting ads without the information provided by external data brokers might not necessarily change much in the long term. Still, the news Wednesday sent the stock of Acxiom, the largest online data-collection firm in the U.S., plummeting more than 10 percent in after-hours trading. Companies that have come to rely on driving customer outreach based on offline shopping could be hurt the most, but those firms will have six months to figure out a new plan before the Partner Categories program is fully shut down.
On Wednesday, Facebook also rolled out a redesign of its privacy-settings page to give customers more control over how Facebook and third-party apps can access users’ personal data. Facebook is currently under investigation by the Federal Trade Commission for potentially violating an agreement it made with the agency in 2011 to obtain affirmative consent from users before accessing or sharing data about them beyond what they’ve explicitly agreed to. Mark Zuckerberg, the CEO of Facebook, agreed earlier this week to testify in front of Congress, which will likely happen next month.