Social media users lack control over data used by AI, US FTC says

By Jody Godoy

(Reuters) -Social media companies collect, share and process vast troves of information about their users while offering little transparency or control, including over how it is used by systems incorporating artificial intelligence, the U.S. Federal Trade Commission said in a report released on Thursday.

The report analyzed how Meta Platforms, ByteDance's TikTok, Amazon's gaming platform Twitch, and others manage user data, concluding that data management and retention policies at many of the companies were "woefully inadequate."

YouTube, social media platform X, Snap, Discord and Reddit were also included in the FTC report, though its findings were anonymized and did not reveal specific companies' practices. YouTube is owned by Alphabet's Google.

Discord, a communications platform, said the report lumps very different business models into one category, and that it did not offer advertising at the time the study was conducted.

Other companies did not immediately reply to requests for comment.

Social media companies gather data through tracking technologies used in online advertising and buying information from data brokers, and other means, the FTC said.

"While lucrative for the companies, these surveillance practices can endanger people's privacy, threaten their freedoms, and expose them to a host of harms, from identity theft to stalking," said FTC Chair Lina Khan.

Data privacy, particularly for kids and teens, has been a hot-button issue. The U.S. House of Representatives is considering bills passed by the Senate in July aimed at addressing social media's effects on younger users. And Meta recently rolled out teen accounts that incorporate enhanced parental controls.

Meanwhile, Big Tech companies have been scrambling to acquire sources of data to train their emerging artificial-intelligence technologies. The data deals are infrequently disclosed and often involve private content locked behind paywalls and login screens, with scant or no notice to the users who posted it.

In addition to collecting data about how users engage with their services, most of the companies the FTC reviewed collected users' age and gender or guessed it based on other information. Some also gathered information on users' income, education and family status, the FTC said.

Companies gathered data on individuals who did not use their services, and some were not able to identify all of the ways they collected and used data, the FTC said.

Advertising industry groups criticised the report on Thursday, saying that consumers recognize the value of ad-supported services.

"We are disappointed with the FTC's continued characterization of the digital advertising industry as engaged in 'mass commercial surveillance,'" said David Cohen, chief executive of the Interactive Advertising Bureau, an advertising and marketing group which counts Snapchat, TikTok and Amazon among its members.

(Reporting by Jody Godoy in New York; Editing by Matthew Lewis and Andrea Ricci)