Privacy advocates are attempting to block Facebook's acquisition of WhatsApp, citing concerns over user data and advertising practices. The Electronic Privacy Information Center and the Center for Digital Democracy have filed complaints arguing that Facebook's intentions violate users' expectations regarding privacy. Despite this, Facebook asserts that WhatsApp will continue to operate independently and honor its privacy commitments while likely leveraging its technology to enhance its own user experience.

1. WHATSAPP ACQUISITION FACES
ROADBLOCK
March 13, 2014
Kate Kotler, writer

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It didn’t take privacy advocates very long to throw up a red flag in an attempt to
block Facebook’s acquisition of WhatsApp:
Reports from the BBC and ThreatPost state that two non-profit foundations (the
Electronic Privacy Information Center and Center for Digital Democracy) have filed
injunctions with federal regulators which could pose a substantial roadblock in the
acquisition process if Facebook doesn’t make the reason for the startup company’s
acquisition transparent. The complaint reads:
“WhatsApp built a user-base based on its commitment not to collect user data
for advertising revenue. Users provided detailed personal information to the
company including private text to close friends. Facebook routinely makes use of
user information for advertising purposes and has made clear that it intends to
incorporate the data of WhatsApp users into the user profiling business model.
“The proposed acquisition will therefore violate WhatsApp users’ understanding of
their exposure to online advertising and constitutes an unfair and deceptive trade
practice, subject to investigation by the Federal Trade Commission.”

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This is a fair point: WhatsApp was built on a strong precept of “no advertising allowed” by its’ founder Jan Koum (as
detailed by Forbes writer Parmy Olsen in her detailed profile piece of Koum and WhatsApp published last month). Whereas,
Facebook has faced considerable criticism over the years for questionable advertising and data mining practices; including,
but not limited to, the implementation of user photos into advertising without permission, supplementing user profiles with
third party data and selling private user data to outside companies.
So, what DOES Facebook intend to do with WhatsApp, if not plunder it for all it’s rich, sweet, unspoiled user info?
Mark Zuckerberg is adamant that WhatsApp privacy promises to users will be honored. In a statement released to Reuters,
Facebook drives this point home: “As we have said repeatedly, WhatsApp will operate as a separate company and will
honour its commitments to privacy and security.”
What most likely is of interest to Zuckerberg and Facebook is the backend technology which powers WhatsApp. As
pointed out in another Forbes article late last week, to simply be mining the data from WhatsApp makes it -essentially- a very
very expensive list of names. What tech insiders suspect Facebook is likely to do with WhatsApp boils down to splitting the
business model in two into the “value creation” (WhatsApp as it stands alone, operating as it has) and the “value
capture” (where Facebook takes the tech WhatsApp has created and implements it into Facebook to provide existing users
with a richer, more engaging user experience).

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In addition, Facebook – of all places – may have a thing or two to
learn from WhatsApp about virility: As the Zuck himself stated, WhatsApp
reached 450m users faster than any other web service in existence. That
includes Facebook and Twitter. According to the Economist, 72% of
WhatsApp users are active on the service every single day. That number is
staggering. Ease of use and the company’s commitment to user privacy
has created the perfect storm to push WhatsApp ahead of its’ major
competitors Skype, Viber and WeChat.
Innovation is not something which is lost on Zuckerberg and crew, so
it is entirely possible that they are interested in acquiring the smarts
behind the app, too.
But, realistically (and, sadly), as with any multi-billion dollar
enterprise, The Guardian’s Dan Gillmor probably is closest to hitting the
nail on the head when he says that Zuck is no “benevolent overlord” and
Facebook is “trying to take over the world” with this latest big deal.
Cue the theme music from Pinky & the Brain… we know Zuck is the
Brain, so who is Pinky in this scenario?
!
Kate Kotler, writer