Feds Approve Facebook Acquisition of WhatsApp

But the Federal Trade Commission is warning the social-media titan to uphold the privacy promises made to users of the mobile-chat app.

National Journal
Dustin Volz
April 10, 2014, 9:56 a.m.

Face­book’s pro­posed $19 bil­lion pur­chase of What­s­App cleared an im­port­ant reg­u­lat­ory hurdle Thursday, a vic­tory tempered by the de­liv­ery of a stern pri­vacy warn­ing.

In a state­ment Thursday, Face­book said the Fed­er­al Trade Com­mis­sion had already ap­proved its pur­chase of What­s­App, though the agency de­clined to com­ment spe­cific­ally on the mat­ter. The com­pany still re­quires an OK from in­ter­na­tion­al reg­u­lat­ors be­fore the ac­quis­i­tion can go for­ward.

“We’re pleased the FTC has com­pleted its re­view and cleared our ac­quis­i­tion of What­s­App,” a com­pany spokes­wo­man said. “Nat­ur­ally, both com­pan­ies will con­tin­ue to com­ply with all ap­plic­able laws after the trans­ac­tion closes.”

But the so­cial-me­dia gi­ant must hon­or the pri­or “pri­vacy ob­lig­a­tions” that What­s­App, a mo­bile chat cli­ent, had prom­ised to its hun­dreds of mil­lions of users be­fore the deal was an­nounced, the FTC no­ti­fied both com­pan­ies Thursday.

“What­s­App’s pri­vacy policy clearly states, among oth­er things, that users’ in­form­a­tion will not be used for ad­vert­ising pur­poses or sold to a third party for com­mer­cial or mar­ket­ing use without the users’ con­sent,” states the let­ter from Jes­sica Rich, dir­ect­or of FTC’s con­sumer-pro­tec­tion bur­eau. “Face­book’s pur­chase of What­s­App would not nul­li­fy these prom­ises, and What­s­App and Face­book would con­tin­ue to be bound by them.”

Some pri­vacy groups have ex­pressed con­cern that Face­book, which re­lies heav­ily on col­lect­ing user data and selling it to ad­vert­isers, would breach as­sumed pri­vacy pro­tec­tions that What­s­App ad­op­ters be­lieved they would be giv­en when sign­ing up with the in­ter­na­tion­ally pop­u­lar mes­saging plat­form. The Elec­tron­ic Pri­vacy In­form­a­tion Cen­ter and the Cen­ter for Di­git­al Demo­cracy filed a com­plaint with FTC last month ob­ject­ing to the pur­chase on these grounds.

“The FTC is to be com­men­ded for send­ing a very strong sig­nal that they will hold Face­book and What­s­App ac­count­able for their prom­ises,” Jeff Chester, the ex­ec­ut­ive dir­ect­or of CDD, said in a state­ment re­spond­ing to Thursday’s an­nounce­ment. “The com­mis­sion’s ac­tion has likely spoiled, for now, the plans Face­book has de­veloped to turn its $19 bil­lion in­to even more di­git­al gold for them­selves.”

If Face­book wishes to use What­s­App data in a way that ex­tends bey­ond the ex­ist­ing pri­vacy agree­ment, it must first earn “af­firm­at­ive con­sent” from in­di­vidu­al users be­fore do­ing so.

This isn’t the first time that Face­book has tangled with FTC over pri­vacy is­sues. In 2011, the com­pany settled gov­ern­ment charges that it had de­ceived its con­sumers and vi­ol­ated pri­vacy agree­ments by chan­ging pri­vacy set­tings be­fore ob­tain­ing con­sent.

“We want to make clear that, re­gard­less of the ac­quis­i­tion, What­s­App must con­tin­ue to hon­or these prom­ises to con­sumers,” the let­ter con­tin­ues. “Fur­ther, if the ac­quis­i­tion is com­pleted and What­s­App fails to hon­or these prom­ises, both com­pan­ies could be in vi­ol­a­tion of Sec­tion 5 of the Fed­er­al Trade Com­mis­sion Act and, po­ten­tially, the FTC’s or­der against Face­book.”

Face­book an­nounced it had pur­chased the five-year-old What­s­App, which boasts 450 mil­lion users and soar­ing growth rate of a mil­lion more each day, in Feb­ru­ary for a hu­mong­ous price tag of $19 bil­lion that shocked most ob­serv­ers, some of whom were un­fa­mil­i­ar with a mes­saging ser­vice that is far more pop­u­lar over­seas than it is in the United States.

What We're Following See More »
PROCEDURES NOT FOLLOWED
Trump Not on Ballot in Minnesota
3 days ago
THE LATEST
MOB RULE?
Trump on Immigration: ‘I Don’t Know, You Tell Me’
3 days ago
THE LATEST

Perhaps Donald Trump can take a plebiscite to solve this whole messy immigration thing. At a Fox News town hall with Sean Hannity last night, Trump essentially admitted he's "stumped," turning to the audience and asking: “Can we go through a process or do you think they have to get out? Tell me, I mean, I don’t know, you tell me.”

Source:
BIG CHANGE FROM WHEN HE SELF-FINANCED
Trump Enriching His Businesses with Donor Money
4 days ago
WHY WE CARE

Donald Trump "nearly quintupled the monthly rent his presidential campaign pays for its headquarters at Trump Tower to $169,758 in July, when he was raising funds from donors, compared with March, when he was self-funding his campaign." A campaign spokesman "said the increased office space was needed to accommodate an anticipated increase in employees," but the campaign's paid staff has actually dipped by about 25 since March. The campaign has also paid his golf courses and restaurants about $260,000 since mid-May.

Source:
QUESTIONS OVER IMMIGRATION POLICY
Trump Cancels Rallies
5 days ago
THE LATEST

Donald Trump probably isn't taking seriously John Oliver's suggestion that he quit the race. But he has canceled or rescheduled rallies amid questions over his stance on immigration. Trump rescheduled a speech on the topic that he was set to give later this week. Plus, he's also nixed planned rallies in Oregon and Las Vegas this month.

Source:
‘STRATEGY AND MESSAGING’
Sean Hannity Is Also Advising Trump
6 days ago
THE LATEST

Donald Trump's Fox News brain trust keeps growing. After it was revealed that former Fox chief Roger Ailes is informally advising Trump on debate preparation, host Sean Hannity admitted over the weekend that he's also advising Trump on "strategy and messaging." He told the New York Times: “I’m not hiding the fact that I want Donald Trump to be the next president of the United States. I never claimed to be a journalist.”

Source:
×