Facebook users could have to pay to completely opt out of their data being used to target them with advertising, according to its chief operating officer Sheryl Sandberg.
The statement came during an interview with NBC News this weekend, following the Cambridge Analytica scandal that has rocked the social network.
“Could you come up with a tool that said, ‘I do not want Facebook to use my personal profile data to target me for advertising.’?” Sandberg was asked by NBC’s Today’s Savannah Guthrie. “Could you have an opt-out button – ‘Please don’t use my profile data for advertising’?”
“We have different forms of opt-out,” Sandberg replied. “We don’t have an opt-out at the highest level. That would be a paid product.”
Sandberg stressed that Facebook would never sell user information on to others or give it away, Sandberg confirmed that the data was so essential to Facebook’s survival that it would continue to use the information itself to help advertisers target campaigns.
“Our service depends on your data. We don’t have an opt-out at the highest level. That would be a paid product,” Sandberg added.
The comments come after Facebook admitted that 87 million users were affected by the Cambridge Analytica data breach, more than previously suggested.
Sandberg added that the platform was giving some ground, including allowing members to opt out of sharing portions of their data and blocking specific advertisers.
There’s no indication that Facebook actually plans to introduce such an option, but Sandberg’s admission makes explicit that Facebook’s revenue depends almost entirely on monitoring its users’ taste and behavior. Taking that option away would require replacing ad sales with subscription revenue.
Our view- digital market moving towards a two tier structure
The privacy breaches and allegations relating to Cambridge Analytica and Aggregate IQ have rocked both consumer and advertiser confidence in Facebook, and the wider social media ecosystem. They’ve called into question the unwritten contract between web service providers and their uncharged users. Although there’s a line of sight you can trace back to the early debates of paywalls since publishers moved onto the web in the 90s, but what’s different now is the scale of the data and the level of insight (read intrusion) it gives. Think about a brand or politician that can buy the data profile of every article you’ve ever liked, shared or clicked on – while stealing that data from your friends through a trojan horse app the way Cambridge Analytica are alleged to have is inexcusable, the ethics of the wider profiling and remarketing are now up for discussion.
Sandberg’s line of thinking leads to a two tier structure of digital services like Facebook and Instagram. Those who are more affluent buy the right of privacy, getting ad free TV streaming services, ad free social media (such as Spotify premium and Netflix), and a transformed experience. This forces advertisers to move to a more “pull” based model of content marketing, service creation and PR if they want to reach that group.
eanwhile, people less affluent stay with ad funded models, such as catch up TV with ad breaks, YouTube and ad funded social media – a second-class internet with growing advertising/editorial ratio to offset declining ad yields. They will be able to access a wide range of media, but only at the price of losing their privacy and receiving a lot of interruptive advertising.
Thanks to Cambridge Analytica and Facebook, this debate will overshadow the digital media industry for the next year, long after allegations of election fraud have run their course. Sandberg can’t back-peddle because Facebook’s business model is built on selling data indirectly through advertising.
Where the consensus between the ad industry and internet users ends up is now unclear. The economics of digital media microtargeting might start to fall apart in wealthy markets, with more people moving into the ‘pay for privacy’ camp, or even legislation such as GDPR becoming stronger and engineered for this purpose. Add to that the slim margins on media companies for less valuable audiences, and the ad funded model will take a kick that could push some publishers over the edge.
