The document discusses Facebook's data privacy dilemma following controversies over data misuse by Cambridge Analytica, leading to heightened scrutiny and new regulations like the GDPR. Facebook has implemented measures to enhance user data management and privacy policies to comply with stricter regulations, while also emphasizing users' consent to data collection. Additionally, it outlines assignments for MBA students analyzing Facebook's response to the crisis, the purpose of GDPR, its requirements, and challenges faced by social networking platforms.

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SBS (MBA) MANAGEMENT INFORMATION SYSTEM ASSIGNMENT
ANSWERS FOR
FACEBOOK DATA PRIVACY DILEMMA
SBS MIS 501 - Management Information System
Assignment 1 Questions for MBA Students
Facebook – Data Privacy Dilemma
In2018, Facebook founder and CEO Mark Zuckerberg came under fire from lawmakers, testifying
before a U.S. congressional hearing, for the Facebook data-privacy dilemma that angered many
users, causing panic in the stock market and intense inquiries from lawmakers and regulators
worldwide.CambridgeAnalytica,aU.K.-basedpolitical dataanalyticsfirm, illicitly procured the data
of 50 million Facebook users, without their knowledge or consent.
In an interviewwithMSNBC,Apple CEOTimCookcriticisedFacebook’shandlingof the situation and
arguedthat Apple could “make a ton of money” if it chose to monetize its customers’ data. “This is
not somethingthatwe juststartedlastweekwhenwe saw somethinghappening.We’ve beendoing
this for years”.
In response,Facebookdetailedseveral stepsit’stakingtosetthingsright.Itsaidit wouldinvestigate
all apps that had access to large amounts of information prior to 2014. Further, it announced new
plansfor restrictionsondevelopers’dataaccess,adoptingtougherpoliciesandterms for third-party
app developers, shutting down certain programs, updating its privacy tools that were designed to
make them easier to find and use, including an easier to use data management tool called ‘Access
Your Information’to provide a simpler way for users to manage, delete or download their posts or
personal profileinfo,plusenablinguserstoeasily see info that the company uses to serve targeted
advertising.
Consequently,Facebook andothertechnologycompanieswillbe obliged and forced to comply with
stricter European privacy protections. The European Union’s General Data Protection Regulation
(GDPR), which came into effect May 25 2018, required companies to obtain consent before
collecting data from consumers. It also gave consumers the right to learn what companies know
about them and even ask a company such as Facebook to delete photos or any other data it may
have.While that,GDPR technicallyappliesonlytoservicesoffered to EU residents, given the global
nature of many online services and the increased focus on privacy, some of the new rules could

2. applyto U.S.users.It’simportanttomentionhere that GDPR, was first drafted in early 2012, passed
despite heavy lobbying against it by big tech companies.
Facebooktracksboth itsusersand non-usersonothersitesandapps.It collectsbiometricfacial data
without users’ explicit “opt-in” consent. Facebook uses artificial intelligence to analyse users’
behaviour. For example, among many possible target audiences, Facebook may offer advertisers
1.5 millionpeople“whose activityonFacebooksuggeststhatthey’relikelytoengage with/distribute
liberal political content”andnearlysevenmillionFacebookusers whom for example, prefer certain
goodsin certaincountries.Facebookuses software tools for tracking activities. For example, when
internet users go to other sites, Facebook may still monitor their activities with software like it’s
ubiquitous“Like”and“Share”buttons,andsomethingcalledFacebookPixel — invisible code that’s
dropped onto the other websites that allows that site and Facebook to track a user’s activities.
Not only, Facebook mine information about users, but in fact, many other companies, do similar
activities, such as for examples, news organizations like The New York Times. The reason that
Facebookwassingledoutforsuchpractices,it wasdue to beinga marketleader,and it’s stockpiling
of personal data is at the core of its $40.6 billion annual business. Despite that Facebook requires
Outside sitesthatuse trackingtechnologiestoclearlynotifyFacebookusers,andallowsthemtoopt-
out of seeingadsbasedontheiruse of those apps and websites, that did not stop angry users from
raisingtheirconcerns over Facebook’s practices. Facebook stresses that, when users sign up for an
account, they must agree to the company’s data policy. It plainly states that its data collection
“includesinformationaboutthe websites and apps users visit, users’ use of their services on those
websitesandapps,aswell asinformationthe developerorpublisherof the app or website provides
to themor Facebook.”Butin Europe,some regulatorscontendthatFacebookdoesnotobtainusers’
explicitandinformedconsent totrackthemon othersitesand apps. Their general concern was that
manyof Facebook’s2.1billionusershadnoidea how much data Facebook could collect about them
and how the company could use it. And there is a growing unease that tech giants run fairly
manipulating users.
To assure and deal with consumers and regulators’ discomfort and anger over the amount of
personal datathat Facebookcollects,Facebookannounced an extended data privacy feature in the
F8 Conference May 2018 called the “Clear History,” feature for users to view what apps and
websitestheyinteractedwithonFacebook,allow themto clear their browsing history on Facebook
(eg. what they clicked on, websites they visited, etc.) as well as allowing them to bar the social
network from collecting it again moving forward.
Questions:You mustanswerALLquestion–(7.5 Marks Each)
The mark for each question is given next to the question. The total mark for this assignment is 30.
1. Based on the compiled article above, explain the steps Facebook took to overcome its data
privacy crisis. Explore the data policy’sectiononFacebook.com, and explain how a user can
manage or delete his/her own information? (7.5marks)
2. Search the Web for the GDPR, then answer the following questions: Explain the purpose of
GDPR. Describe at least three the key privacy and data protection requirements of the
GDPR. (7.5marks)
3. Describe Facebook’s e-business model and revenue model. Discuss Facebook’s business
benefits and challenges. (7.5marks)
4. Evaluate in general terms, the challenges facing social networking websites and identify ways
companies can prepare to face these issues. (7.5marks)

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