William Carleton, Counselor @ Law

Spying vs. stealing

Imagine Facebook had to pay you for using any information about you.

Instead of balancing "personal privacy" against some super-secret corporate imperative to profile you for the purposes of manipulating you, instead of that, your individual interests, and Facebook corporate interests, were perfectly aligned.

You and Facebook were partners in the monetization of your information, your personality.

In short, your information was your intellectual property.

In the privacy paradigm, Facebook may or may not get the "balance" - between your interests and its commercial imperatives - exactly right, but Facebook alone controls all exclusive intellectual property rights.

In the personal-information-as-intellectual-property paradigm, Facebook must account to you for how your information is processed and exploited. No "balancing act" required; simple commercial reporting obligations ensure accountability.

If we thought about our information this way, and if our commercial relationships with large web services were built to meet such expectations, it would be harder for companies like Facebook, Google, Apple, etc., to cooperate with government requests for all the data that runs through the corporate servers.

"That data does not belong to us," they could say. Depending on their contract with customers, they might also say, "It is, however, available for a premium fee."

Some people might be willing to sell their information to the government in exchange for good and valuable consideration - say, a federal income tax credit. For some, maybe patriotism would be sufficient consideration.

Facebook is not the internet

News item: "U. S. employees set to be forced to give bosses their Facebook PASSWORDS."

It's time to stop letting Facebook, the affiliate marketing company, wrap itself up as a proxy for the internet.

If you want to defend the internet, why take as a poster child a company whose business is antithetical to openness, transparency and user empowerment? A company that surrenders to an advertising model, as though 20th-century specific publishing models were the natural order of things.

Sheryl Sandberg is way cool, but the great work she is doing in stimulating debate about America's gender skewered worklife has nothing to do with her being an exec at Facebook. She could be at Google. Or John Deere.

If you want to defend the Internet, convince Peter Thiel to pay every Facebook employee $1 million to go back to college and get a liberal arts education. Imagine these guys (that's largely true, right?) read Camus and studied art history at the same time they were let loose with code.

How recursive will Facebook's graph search be?

Developer extraordinaire Evan Jacobs (here's background on what I think is his most recent project, Authorgraph, a service by which authors can personalize ebooks for individual readers) has been anticipating how the new Facebook graph search might perform.

Recently, he blogged about what he would be looking to test in the release. One key question: "Will a user's Graph Search queries become part of the Open Graph," and, if so, "then how many levels deep would Facebook allow queries of those queries (e.g. 'people who searched for people who searched for divorce lawyers')?"

Well, Evan tweeted yesterday that he had just gotten access to graph search, and his initial reaction is that it doesn't support the kind of recursion he thought it might. 

I don't have a Facebook account, but I would like to follow how this Facebook search feature develops. So I've asked Evan to let us republish here anything he writes up on his blog, reporting on what he finds as he puts the new search feature through its paces. He's said yes, so we'll look forward to that.

In the meantime, Evan points out this Tumblr site with what looks to be examples of far out queries that can be run and that return results.

Photo from the Newcastle upon Tyne criminals of the 1930's set on Flickr. Thanks to Tyne & Wear Archives & Museums.

Insta-regret

We're not done with the Instagram ToS fiasco, not yet.

Facebook had thought to create some space to start experimenting with exploiting Instagram users in the manner it exploits Facebook users. But the outcry - combined with the apparent reality that photo takers saw alternatives, and were taking them - caused it to back off. The new plan? Facebook will first pick a sponsored story or other new ad scheme, then socialize the requisite ToS changes.

Venkat Balasubramani and Eric Goldman had the definitive post on the imbroglio yesterday (hours before the news broke of Facebook's recantation).

Venkat points out that Instagram's current terms already give the company pretty much the same rights in user photos as the controversial new language. "I don’t see [the newly proposed license language] as a significant change to what Instagram can do with your photographs," he writes. In Venkat's view, the main reason for the language change was to conform the Instagram ToS to language in a settlement Facebook has recently reached with users who objected to being unwitting participants in "sponsored stories."

So the reversion to the existing ToS may not mean that all concerns raised this week will be rendered groundless, not necessarily.

One refrain Goldman repeats - in his blog and when quoted in the press - is that a clash between a social media service, any social media service, and its users, is inevitable. “The interest of the site is never 100 percent aligned with the users, and the divergence inevitably leads to friction,” Goldman was quoted this week in the NY Times as saying. “It’s unavoidable.”

But I don't think that's right.

We're in early days for the commercial web, and we have yet to see a company or visionary entrepreneur imaginative or strong enough to perceive or realize that social media's destiny is not to double down on advertising, but instead to disintermediate it.

Who knows when the Theodore Roosevelt of social media may arrive? In the meantime, a simple bridge to the demise of advertising would be for the service to split the difference, share the proceeds with users. Why not experiment with the idea that users will earn money from the surrender or license of their PII?

Photo: Kevin Dean / Flickr.

Dissemble-gram

It's great that Facebook is going to re-think the changes it tried to slip past Instagram users (who knew the NY Times Bits Blog would be laying in wait, ready to bust 'em?).

Though it's disappointing that Kevin Systrom was reduced to dissembling. 

As a piece of anonymous corporate PR damage control, his Tumblr post yesterday is okay. But when one puts one's personal name on a piece of writing - that throws bullshit into high relief.

It is not credible to say that "One of the main reasons these documents don’t take effect immediately, but instead 30 days from now, is that we wanted to make sure you had an opportunity to raise any concerns." 

If you visit the page http://instagram.com/about/legal/terms/updated/, you'll find the first two sentences read as follows: “These Terms of Use are effective on January 16, 2013. To access our previous Terms of Use, please click here.” No suggestion that the terms are proposed, subject to revision, or in any way represent a trial balloon. The second sentence implies that the new terms are a done deal, set and ready to take place among the archive of terms that had been deployed.

A more plausible "main reason" for the thirty day notice of changes may well be the FTC consent order to which Facebook is subject.

Key parts of that consent order apply to actions Facebook takes "through any corporation, subsidiary, division, website, or other device." Because the consent order says users must be told about what Facebook does with user's "covered information" and because photos are included in the definition of "covered information," notice of material changes to Instagram's policies, after the fact, could conceivably have put Facebook in violation of its agreement with the FTC.

Why not share the revenue?

Facebook's utter lack of imagination continues to astound.

Here's a snippet of a redline showing select, key language in Instagram's proposed new terms of service, marked against its current terms.

It's no pat on the back to say I saw this coming. Everybody did. But just for fun, check out this parody post from last spring.

Regarding the warning that Facebook will not share with the user the ad revenue Facebook derives from use of the user's likeness and content: why not?

The Hastings Facebook page kerfuffle: more context

I've just read Broc Romanek's post on TheCorporateCounsel.net from earlier this week: "RIP? Social Media Use for Corporate Disclosures."

The title is broadly worded, probably because the incident falls into a category Romanek posts on frequently, but the post itself digs into the controversy over Netfilx CEO Reed Hastings' use of Facebook to make company disclosures, something the SEC has called out.

Two posts on this blog, "Disclosure out of sight" and "Reed Hastings' 'public' Facebook page," got some great discussions going, and bridged over to a deeper discussion on Kid Dynamite's blog. But I think those discussions are missing important context and nuance that Romanek provides.

Romanek suggests that the SEC is targeting a company that is overall actually egalitarian about disclosure: "Netflix is one of the only high profile companies that is friendly to retail investors. They accept retail investor questions on their conference calls via email and make the analysts wait on the call until all the emailed questions are dealt with."

That sounds pretty cool and investor-friendly.

Romanek touches on the use of investor relations pages on corporate websites, then concludes, as many in the tech industry have, that the SEC needs to get more current about what the internet is today:

"The SEC needs to evolve and regulate more broadly. Get away from the hyperfocus on the disclosures it forces to be filed on Edgar. Focus more on what investors actually bother to read. Don't punish the companies that want to reach investors in the manner that today's investors consume information."

I still have problems with a public company treating a closed community as though it were a public forum. (Though I clearly see I can follow a link someone provides me to Netflix disclosure in the form of a discrete Hastings Facebook status update, I don't seem to be able to get into his Facebook page to search or browse.) But I may have given SEC staff more credit in the matter than they are due.