Watchdog concerned Facebook ‘exploiting’ consumers

Australian competition czar Rod Sims is concerned Facebook could be exploiting consumers’ lack of knowledge.

Australian Competition and Consumer Commission chairman Rod Sims. Picture: Kym Smith

Australian competition tsar Rod Sims is concerned Facebook could be exploiting consumers’ lack of knowledge of the way the social network uses personal data and allows companies to access the information without their knowledge or consent.

The Australian Competition & Consumer Commission chairman said he had held talks with Australia’s information and privacy commissioner Timothy Pilgrim in recent days after it emerged data from 50 million Facebook users worldwide was harvested without their consent by Britain-based research firm Cambridge Analytica.

Data protection was high on the agenda of the ACCC’s world-first probe into the Australian digital market, Mr Sims said.

“We’re looking at what consumers understand about the price that they’re paying to use Facebook; what data Facebook collects; how it is used and whether consumers are misled by that,” Mr Sims told The Australian.

“We’re interested from a competition point of view about how data is used and the extent to which that impedes competitors, but I think the consumer point is now the more relevant one in terms of what has been revealed over the past week.”

Facebook profits from people’s personal data by using the information to create highly targeted advertisements.

While data is often described as the oil of the 21st century because of the vast untapped value extracted from it by the tech giants, little is known about their practices and the technology behind data-based marketing.

The Australian last year obtained confidential Facebook documents that discussed how the company could target advertisements at depressed children.

As Facebook users delete their accounts, the social network could face an advertiser backlash amid growing concern the platform is not a safe and trusted environment for brands.

The chief executive of the Australian trade group for Unilever, NAB, ANZ, Woolworths, and Westpac has called on Facebook to clean up its act quickly.

“Advertisers will be looking for evidence that providers have the necessary measures in place to prevent privacy breaches occurring,’’ said John Broome, chief executive of the Australian Association of National Advertisers.