Blockbuster Sued For Revealing Movie Rental Info To Facebook's Beacon

from the oops dept

There was plenty of people upset by Facebook's original "Beacon" advertising system, that automatically connected information on purchases to your "news feed" and broadcasted them to all your Facebook friends -- but now we'll find out if some of that activity was illegal. One of the initial participating companies was Blockbuster, who automatically fed information to Facebook about what movies you had rented. It turns out that there's a specific federal law against revealing info about movie rentals (who knew?). The Videotape Privacy Protection Act was apparently passed by Congress after Supreme Court Appointee Robert Bork's videotape rentals were revealed while he was being reviewed by Congress. While plenty of folks don't know about this law, you would think that it would be pretty near the top of the list of laws that a company like Blockbuster would be familiar with. Yet, it seems to not have occurred to anyone there that automatically feeding movie rental info to Facebook might violate that law. However, it appears someone else did recognize this and has now sued Blockbuster for violating the law. Not surprisingly, the plan is to turn this into a class action lawsuit. Thanks to the specifics of this particular law, it's unlikely that other Beacon participants violated this law, but it's only a matter of time until class action lawyers figure out some other law they probably violated.

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Learning Good Privacy Rules Requires Experimentation

from the 20-20-hindsight dept

Ed Felten has an interesting post analyzing the fallout from Facebook's Beacon gaffe. It's now widely agreed that the company screwed up, which raises the question of why it wasn't obvious ahead of time that Beacon would prove unpopular with users. Felten offers a few ideas: delegating privacy to a single isolated department, treating privacy as a legal or PR problem, or underestimating the importance of peoples' emotional reactions. I think there's also something more fundamental going on: often no one really knows what the privacy rules for new technologies will be. We're now doing things with information that were literally impossible a couple of decades ago. Social conventions haven't been keeping up. As a result, no one—even users themselves—knows what will be considered a privacy violation until after it's been tried. Sometimes, as with last year's Facebook news feed announcement or Google's introduction of GMail, an initial negative reaction blows over once users learn more. In other cases opposition snowballs to the point where a company has no choice but to change course. It's often difficult to predict ahead of time which category a given product will fall into. Peoples' initial concerns are often based on very superficial impressions (such as the idea that GMail is "reading your email") that can turn out to be unfounded once users become more familiar with the product. Other features, such as Facebook's news feed, can turn out to be useful enough that users consider it to be worth a bit of foregone privacy. And in some cases, a new feature just turns out to be a plain old bad idea. We won't know until users have a chance to try a feature and provide feedback. Which is why I think it's a mistake to judge a company too harshly for introducing a new product that turns out to be a bad idea from a privacy perspective. We'll only learn good principles for privacy by experimentation, and experimentation inevitably leads to some missteps. As long as a company clearly discloses how user information will be used and is responsive to user concerns, I don't think people should hold the occasional misstep against it.

Timothy Lee is an expert at the Insight Community. To get insight and analysis from Timothy Lee and other experts on challenges your company faces, click here.

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What Made Beacon A Bust?

from the too-big-to-make-it-work dept

There's no question that Facebook's Beacon initiative has taken a beating over the past few weeks. The feature automatically collected and published users' activities at partner sites, and almost immediately attracted criticism. MoveOn launched a campaign in opposition to Beacon. Horror stories of accidentally disclosed purchases — like engagement ring purchases and Christmas presents — began to circulate. The early word was decidedly negative, prompting some partners to begin to jump ship. Facebook has weathered similar storms before: its minifeed feature was met with a hostile reception, but is now emulated by virtually every new social network. But this time they caved: on Wednesday founder Mark Zuckerberg wrote a rather contrite blog post:

We've made a lot of mistakes building this feature, but we've made even more with how we've handled them. We simply did a bad job with this release, and I apologize for it.

...

Last week we changed Beacon to be an opt-in system, and today we're releasing a privacy control to turn off Beacon completely.

It remains to be seen whether users will opt out en masse — there are indications that many may still not be aware of Beacon. But the negative press seems likely to scare away potential partners. So while it would be premature to declare Beacon a failure, it seems very unlikely that it will ever achieve its intended net-spanning potential.

I think there are three reasons why this happened. First, Beacon's simply not a feature that people — as opposed to companies — were clamoring for. Facebook noticed its users expressing opinions about products and saw a great opportunity to make money. But they couldn't resist removing the messily inefficient human portion of the opinion-expression process. Unfortunately, users didn't get much value from having that process automated.

Second, and perhaps most obviously, Facebook bungled the deployment of the feature. As Zuckerberg admits in the above-linked post, the company didn't think hard enough about how users would respond, and was too slow to react to how they did.

But the third factor may be the most problematic for Facebook: they're just too big. I don't mean to call MoveOn's anti-Beacon campaign dishonest, but it's not exactly in keeping with the organization's style. It's hard to imagine they'd have undertaken the effort if there wasn't plenty of free press attention to be had by attacking Facebook. The social network has achieved a level of popular attention that makes them an attractive target (and, if you subscribe to the nightclub theory of social networking, one that could presage a no-one-goes-there-because-it's-too-crowded problem).

Of course it would be silly to spend too much time doomsaying — the site's pageviews continue to grow at a healthy clip. But in the wake of the partial collapse of Beacon, it's hard to imagine Facebook launching another initiative as ambitious — and it's even harder to imagine them launching one successfully.

Tom Lee is an expert at the Insight Community. To get insight and analysis from Tom Lee and other experts on challenges your company faces, click here.

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