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$FB Facebook Delivers 450-Page Homework Assignment to Congress

Source: Dow Jones News
By Georgia Wells and Deepa Seetharaman
Facebook Inc. turned in more than 450 pages of homework to U.S. lawmakers, defending itself against claims that it is a monopoly and sidestepping questions about the effectiveness of an app that can effectively spy on competitors.

In documents released Monday, Facebook responded to more than 2,000 questions posed to Chief Executive Mark Zuckerberg by members of U.S. Senate and House committees when he testified in April. The material is granular in places and sometimes evasive, and delivered no apparent bombshells.

In the responses, which took Facebook two months to compile, the social networking giant emphasized that it is learning from its mistakes and giving users more control over their information. Facebook also provided more detail about the information it collects on users, including the battery level on their devices and computer mouse movements.

The company deflected questions that probed at Facebook's increasing market power and influence in the world.

Facebook said it faces healthy competition, and listed other apps that people can use for certain features it offers. Facebook also said that the average American uses eight different apps to communicate with friends and stay in touch with people.

"In Silicon Valley and around the world, new social apps are emerging all the time," Facebook said, in response to a question about claims that the company doesn't have real competitors. "There is a lot of choice, innovation, and activity in this space, with new competitors arising all the time."

Facebook didn't mention that it owns four of the most downloaded free mobile apps: its main service, the photo- and video-sharing app Instagram and two chat apps, Messenger and WhatsApp.

Facebook is dealing with the fallout in March related to the use of personal data by Cambridge Analytica, a political analytics firm that aided President Donald Trump's 2016 presidential campaign and purchased data on 87 million users from another developer.

In social media, Facebook's two main competitors Twitter Inc. and Snap Inc. count user bases that are just a fraction of the size of Facebook's. Both companies have struggled to wrest larger shares of online advertising budgets from marketers. Venture capitalists say they are wary of backing new social networking upstarts, because they believe it would be difficult to compete with Facebook.

Facebook also has an added advantage over upstarts: In 2013, it bought an app called Onavo, which the company has transformed into a database that allows it to see what people do on their phones beyond Facebook's own apps. Facebook has used the app to give it insight into its rivals' services and informed the company's decision to buy companies like WhatsApp in 2014, The Wall Street Journal reported last year.

In responses to lawmakers Monday, Facebook claimed that its privacy policy for the Onavo app makes it clear to users that their activity is being tracked.

"People must tap a button marked 'Accept & Continue' after seeing this information in a full-screen interstitial before they can use the app," Facebook says.

A Facebook spokesman referred to the company's cover letter accompanying the responses. "We did our best to review and answer them in the available time frame. We respectfully request an opportunity to supplement or amend our responses if needed," he said.

Write to Georgia Wells at [e-mail] and Deepa Seetharaman at [e-mail]


(END) Dow Jones Newswires

June 11, 2018 21:56 ET (01:56 GMT)

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