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Ireland's political and cultural magazine
April 2017 5 3
A
ROUND 25% of the population of the earth use Facebook. Its latest
accounts, presenting figures up to December 31st 2016, reveal that, at
peak, there were 1.83 billion active users, 1.74 billion of those connecting
from a mobile device.
Figures for Ireland are less clear-cut, but 65% to 78% of the adult popu
-
lation is estimated to be using the service. Stand on the main street of any town in
Ireland. If you’re not on Facebook the likelihood is that the person next to you is.
The latest figures for 2016 show revenues hitting $27.7bn. A little bit of maths, taking
into account regular active users at approximately 75%, reveals that Facebook makes
between $18 and $20 per active user every year. That’s pretty impressive for a com
-
pany that offers a free service. Conventional wisdom suggests that a company can
only be making money by selling something; so what exactly is Facebook selling?
Facebook’s real product
Facebook is selling you. Not the real you, but the virtual
you that lives and works online. Facebook, among others,
has turned you into a product, and it sells the ability not
just to reach you, but to very specifically target you based
on a surprisingly intimate knowledge of what would make
you a potential customer. Facebook has become so good
at selling you, over and over again, that 84% of its revenue
comes from advertising.
You have been analysed, categorised, matched and
packaged into a commodity that advertisers can turn their sights on using the tools
that Facebook provides. You can be found based on your gender, age and ethnicity;
your relationship and employment status; your education level and any interesting
life events, such as birthdays, anniversaries, whether you’re newly engaged or
recently married. Of course, for the 1.74 billion mobile users you can also be found
based on where you are, where you were recently or on whether you are visiting a loca
-
tion or are at home.
MEDIA
Facebook
owns you
And the EU is facilitating
its quest to get your bank
information
by David Waldron
Facebook has 1.83 billion
active users, 1.74 billion
of those connecting
from a mobile device
5 4 April 2017
This is before it even gets started on your interests,
your work, and your entertainment and social prefer-
ences. From food to hobbies to political affiliations a
cursory examination of the various ways you can be tar-
geted reveals no less than 250 criteria that can be
selected. All for the sole purpose of grouping you
into consumer groups with the intention of
presenting advertising so specifically tai-
lored to you that the likelihood of a
sale increases.
How much does that likelihood
increase when you’re so tar-
geted? 200%-300% is the
conservative estimate.
How do you become
a product?
If you are only realising now that
you have been ‘productised’ I
wouldn’t be overly shocked as most of
Facebook’s users are largely oblivious to
what’s happened. In Facebook’s defence
though, they are quite explicit in their terms and
conditions:
“For content that is covered by intellectual property
rights, like photos and videos (IP content), you specifi-
cally give us the following permission, subject to your
privacy and application settings: you grant us a non-
exclusive, transferable, sub-licensable, royalty-free,
worldwide license to use any IP content that you post on
or in connection with Facebook (IP License). This IP
License ends when you delete your IP content or your
account unless your content has been shared with
others, and they have not deleted it”.
That’s right, worldwide and royalty free; you gave over
the information and agreed to let Facebook use it for
free. Moreover, scrutinising the various sub-areas of the
terms and conditions, specifically the data policy, we
find:
“When we have location information, we use it to tailor
our Services for you and others, like helping you to
check-in and find local events or offers in your area or
tell your friends that you are nearby.
We conduct surveys and research, test features in
development, and analyse the information we have to
evaluate and improve products and services, develop
new products or features, and conduct audits and trou-
bleshooting activities”.
Not only did you give it to them, you agreed to let them
use it almost without restriction: your profile informa-
tion; your messages; your likes and, though not often
considered, your photographs. Facebook estimates that
it receives 134,000 new photographs along with nearly
300,000 status updates every minute of every day. Face
-
book users are literally keeping the company informed
of their every move.
For Facebook, the challenge is simply to gather up as
much information as it can about you as quickly and as
easily as possible.
How to get people to monitor
themselves
Facebook has to convince you that you want to give it the
information. It can’t directly ask you for it, you need to
volunteer it.
The process starts the moment you create an account,
give over your name, age and gender. So far so good.
Next, for the purposes of making it convenient to connect
with your friends, you’re afforded the opportunity to
import your contacts from your phone or your email
system or from other networks such as LinkedIn. Excel-
lent, now Facebook knows not only about you, but also
all of your contacts including, maybe, some it didn’t
know about before. Did you remember to remove phone
numbers from your contact list before uploading it to
Facebook? Of course you didn’t. Facebook now has an
additional piece of information that can uniquely identify
a person. Imagine if your friend explicitly didn’t add their
phone number, or their address, not to worry: you just
fixed that outstanding issue. For Facebook. Congratula
-
tions! You are now a data source and of course an early
stage product.
You could be a better product if you could be convinced
to offer up more information about yourself. Your friends
like this music and these movies, but how about you?
Any other music or movies you like? Where did you go to
school? How about university? Look: here’s a group of
people who went there also. When did you say you
attended?
The greatest trick Facebook has managed to pull off is
the omnipresent ‘Like’ button. Read an article; just click
the ‘Like’ button. Bought something on Amazon, tell your
friends by clicking the ‘Like’ button. Every like you make,
and every like that your connections make feeds the
Facebook machine with more information on you.
And so it goes. You have quickly moved from a good
product to an excellent product. Facebook is starting to
build a good impression of what makes you tick. On to
the next challenge. You really need to start tracking your-
self so Facebook can always know where you are.
Here’s a friend going to an event in the future, are you
going? Would you like to allow Facebook to get access to
your calendar so that it can add a reminder for your con
-
venience? Good! While Facebook is looking it might
discover some birthday reminders or perhaps anniver-
sary days. Is that event today? Are you there already?
Why not take a quick selfie with you and your friends?
You can upload that to Facebook for sharing with your
friends. Don’t worry if you don’t know exactly where you
are, if you have location services turned on, or more
accurately forgot to turn location services off, your
camera will automatically tag the photo with the date,
time and specific location of the photograph. As soon as
you upload that photograph to Facebook, all of your
friends will be able to find you on a map. Even if you turn
off location services, someone has already told Face-
book where the event was taking place, so while it can’t
track you to the nearest metre; at least it knows what
building you’re in.
Next time you look at that photograph on Facebook,
you’ll notice that it’s tried to identify all of the people in
the photograph, just in case you forget. Facebook’s
The directive
requires that
any bank in the
European Union be
required to grant
access to any
authorised AISP
or PISP
MEDIA
April 2017 5 5
researchers estimate that they can accurately match
faces 97.25% of the time. Humans can accurately match
97.5% of the time. Happily, in the rare cases where it
incorrectly matches a face, the photographer is encour-
aged to fix the mismatch with the correct name. That fix
teaches Facebook’s facial recognition engine a little bit
more, allowing it to be better next time around. It has
been mooted that Facebook’s facial recognition might
outperform the FBI’s.
The worrying aspect of this particular facility is that
you can exist on Facebook long before you even sign up.
All that is required is for you to appear in a photograph
taken by anybody, either deliberately or accidentally,
and for the Facebook engine to have been told by any of
its users who you are.
At no other point in history has your personal privacy
been so challenged. Whether through personal choice,
or through the choices of others, it is probable that you
exist in some form on Facebook. The depth of that exist
-
ence is only partially in your control. While Facebook
highlights that your information will be deleted on
request it is limited to the information that you have pro-
vided. The information that others have provided on you
is not actually yours and therefore not covered by those
same conditions.
Is it only Facebook?
You might reassure yourself that only Facebook is under-
taking this type of work, but you can take no comfort
there. ‘Big Data’ is the buzzword of the day in technology
circles. You can distil it down to companies sucking up
as much data as they can about you and your environ
-
ment for the purposes of analysing, tracking and
ultimately selling. Major forces making significant rev-
enue in this field include:
• Google
• Amazon
• Microsoft
• IBM
• LinkedIn
• Netflix
Everyone on the Internet leaks a trail of information
knowingly and unknowingly.
The Future
The one area into which Facebook has not yet managed
to access is your actual financial transactions. So far its
efforts have been limited to encouraging you to click a
‘Like’ button on the retailer’s website. If the retailer
hasn’t added a ‘Like’ button then Facebook can only
guess whether you made a purchase.
Luckily for you, the European Commission has pro-
duced a directive that will allow authorised entities to
gain access to your bank accounts, including your trans-
action history. The Second Payment Services Directive
(PSD2 to those in the know) comes into force in January
2018. Its intention is to foster competition, harmonisa
-
tion and openness in the EU financial markets.
There are two acronyms with which you will become
intimately familiar, AISP and PISP.
An AISP, Account Information Service Provider, is
described as a duly authorised ‘Natural or Legal Person’
to whom you can grant access to your transaction history
for the purposes of providing you with some service. If
you consider almost any financial arrangement you have
entered into, you may have been required at some point
to provide your last three or six months’ bank state-
ments. An authorised AISP would be able to reach into
your bank and retrieve this information, again for your
convenience.
A PISP, Payment Initiation Service Provider, is
described similarly as a duly authorised ‘Natural or Legal
Person’ that you can authorise to initiate a payment
directly from your bank account. All those online trans-
actions that you made with your credit card or debit card
can now be completed without needing the card, directly
from your current account with a quick and convenient
authorisation.
The immediate question is who can be authorised, and
who will control authorisation. For the first part, any indi-
vidual or company that meets the required standards can
be authorised, so everyone from your local newsagent
to the largest corporation could be authorised, if they
can meet the requirements established by the ‘Compe-
tent Authority’. The Competent Authority is the body that
will be responsible for controlling the authorisation pro-
cess. In Ireland, it will be the Central Bank; in other
jurisdictions it will be their financial regulator.
The directive requires that any bank in the European
Union be required to grant access to any authorised AISP
or PISP. The banks have no option to deny or restrict
access. In practice this will mean that an AISP or PISP
that has been authorised by any EU financial regulator,
the Greek regulator for example, must be granted access
to your Irish bank account if you allow it.
PSD2 creates an environment where banks, which tra-
ditionally ran a closed shop on your information, will be
forced to build a doorway into that information and fur
-
thermore will be required to open that door to any person
or entity that has been given rights by any financial regu-
lator within the EU.
Why is this of interest? It is fair to speculate that Face
-
book among others would quickly apply to become a
regulated AISP with a view to gaining access to your
transaction information. Its view of how you spend your
money would be immediately transformed from one
driven by speculation, prediction and estimation to one
that is accurate down to the euro. Of course, it requires
your authorisation to actually gain access but if their
operation has shown anything it is Facebook’s ability to
convince billions of people to volunteer private informa
-
tion.
MEDIA
Facebook has become so good at
selling you, over and over again,
that 84% of its revenue comes
from advertising
