ACCC’s Big Tech crusade: Facebook court action

James Riley

Australia’s competition watchdog has continued its crusade against big tech and is taking Facebook to court over the use of its VPN app to allegedly hoover up data from users for its commercial benefit.

The Australian Competition and Consumer Commission (ACCC) has been escalating its fight against some of the biggest tech giants in the world in recent years.

It handed down its landmark report from its 18-month inquiry into digital platforms, with its flagship recommendation, for a bargaining code between media firms and Google and Facebook to determine revenue-sharing deals, currently before Parliament.

The ACCC has also launched multiple court proceedings against Google in the last year over its collection of personal data.

Ordinary people: ACCC in new court action against Facebook

The competition watchdog has now instituted proceedings in Federal Court against the other Big Tech firm in its crosshair, Facebook. The ACCC has said that Facebook “misled” its users in promoting its VPN app, Onavo Protect, which it acquired in 2013.

Between early 2016 and late 2017, Facebook engaged in “misleading or deceptive conduct” when promoting the app as a way to “protect” users’ data, when it was actually aggregating and using significant amounts of the personal activity for its commercial benefit, the ACCC said.

Facebook claimed at the time that Onavo Protect would keep users’ personal activity online private, protected and secret, and that this data would not be used for any other purpose.

The Onavo website stated that the app would “save, measure and protect” the data, while Facebook’s statements included: “keep it secret. Keep it safe….Onavo Protect, from Facebook.”

But according to the court action, through the app Facebook was collecting information about users’ internet and app activity, the records of the apps they accessed and the time they spent on these apps, in order to help its market research and identify future potential acquisitions.

“Through Onavo Protect, Facebook was collecting and using the very detailed and valuable personal activity data of thousands of Australian consumers for its own commercial purposes, which we believe is completely contrary to the promise of protection, secrecy and privacy that was central to Facebook’s promotion of this app,” ACCC chair Rod Sims said.

“Consumers often use VPN services because they care about their online privacy, and that is what this Facebook product claimed to offer. In fact, Onavo Protect channelled significant volumes of their personal activity data straight back to Facebook.

“We believe that the conduct deprived Australian consumers of the opportunity to make an informed choice about the collection and use of their personal activity data by Facebook and Onavo.”

The ACCC is seeking declarations and pecuniary penalties from Facebook.

The Onavo Protect app was removed by Apple from its app store in 2018 for non-compliance with its developer terms and was removed from the Google store and discontinued last year.

The recent US Federal Trade Commission proceedings against Facebook, alleging the company has illegally maintained a monopoly through anti-competitive conduct, included references to the Onavo Protect app and its use to identify future acquisitions to maintain this monopoly.

The competition watchdog has been very active in addressing the market power of big tech giants such as Facebook and Google in recent years.

Late last year the ACCC announced it would be suing Google over the way it collects, keeps and uses personal location data of its users, alleging it engaged in “misleading conduct and made false or misleading representations” to users over the collection of location data.

It launched another court fight against Google in July this year, this time over the expanded collection and use of personal information of Google users for targeted advertising. This court action will focus on the linking of Google users’ account information with data collection from activity on websites other than Google.

The mandatory bargaining code, which will force Google and Facebook to enter into revenue-sharing deals with media companies over the sharing of their news content, was introduced to Parliament this month after it was developed by the ACCC.

This received significant pushback from the tech companies, with Facebook threatening to ban all Australian news content from its platform, and Google launching a large-scale public campaign against the code.

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