The company has already paid a $5 billion penalty for violating consumer privacy in a different lawsuit
Documents submitted as a part of a court case alleging that FaceBook and Netflix had a special agreement allowing them to share user data. Alarmingly, FaceBook reportedly granted access to private user messages with third-party applications in exchange for data.
FaceBook allegedly shared private user messages with Netflix
By 2013, Netflix had begun entering into a series of “Facebook Extended API” agreements, including a so-called “Inbox API” agreement that allowed Netflix programmatic access to Facebook’s user’s private message inboxes, in exchange for which Netflix would “provide to FB a written report every two weeks that shows daily counts of recommendation sends and recipient clicks by interface, initiation surface, and/or implementation variant.
In return, FaceBook would get access to a $40 million ads spending by Netflix. Netflix user data was used for targeting on Facebook ads
Netflix CEO Reed Hastings sat on the FaceBook board for several years (2011-19). He had regular communications with the Facebook CEO, Mark Zuckerberg, as per the docs.
Despite spending billions of dollars and over two years building FaceBook Watch, their streaming service, the company suddenly started dismantling it. It started with massive budget cuts and was quickly followed by a reduction in overall momentum.
Amidst the sudden pivot in Facebook’s video strategy, the data partnership between Netflix and Facebook reached new heights. Facebook and Netflix entered into a series of new data-sharing agreements between August 2017 and April 2018, FAC ¶¶ 509-512, and another in July 2018, id. ¶¶ 515-22. Netflix also further increased its Facebook ad spend, agreeing to a guaranteed 2017 ad spend of $150 million. These new agreements provided Facebook’s ad targeting systems with rich signals from Netflix, including “cross-device intent signals,” while expressly unhooking Watch from the benefits of this bounty.
The ad spend had increased to almost $200 million a year by early 2019. The lawsuits raise serious concerns over user privacy on Facebook. Tech giants selling private user messages without their explicit consent could prove to be a major concern in the years to come.
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The Company refutes the allegations
Meta’s communications director, Andy Stone denies the allegations calling them untrue in an X post.
Shockingly untrue. Meta didn’t share people’s private messages with Netflix. The agreement allowed people to message their friends on Facebook about what they were watching on Netflix, directly from the Netflix app. Such agreements are commonplace in the industry.
Previously FaceBook has claimed to implement end-to-end encryption for chats in WhatsApp and FaceBook Messenger. But the documents allege that Facebook made exceptions for some companies such as Netflix.
Meta’s official statement on end-to-end encryption reads as follows:
The content of your messages and calls in end-to-end encrypted conversations is protected from the moment it leaves your device to the moment it reaches the receiver's device. This means that nobody else can see or listen to what's sent or said - not even Meta. We couldn't even if we wanted to.
In 2019, the FTC imposed a $5 billion fine on FaceBook for violating consumer privacy. At the time, it was one of the largest U.S. Government penalties ever imposed.
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