EC privacy concerns could threaten Facebook

 

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By Matthew Sparkes

Posted on 18 Jun 2009 at 11:21

Social-networking sites could lose a significant source of revenue in Europe as a new report raises concerns over the use of personal data by third parties.

Although sites such as Facebook and MySpace are covered by European legislation on data protection and privacy, the introduction of third-party applications on these sites has opened users' personal data up to an increasingly large group of developers and marketeers.

Social networking sites now draw much of their revenue from placing advertising on these third-party applications. But these third-party developers and marketers should be placed under tighter restrictions argues the report from EC advisors, the Article 29 working party.

Even companies based outside Europe should fall under the same level of scrutiny, claims the group, if its applications operate here.

The suggestion could even be interpreted to cover individuals who have large numbers of contacts or friends on such sites. Many celebrities have large groups of contacts on social-networking sites, and could potentially be subject to the same rules and regulations on privacy and data protection.

Although the report is purely advisory, and carries no official influence, the group includes some powerful members. Information Commissioner Richard Thomas sits on the panel on behalf of the UK.

If tighter rules were brought in by individual countries then sites such as Facebook may have to rethink their business model for the European market.