Gennaro Muhammad Anugerah Jusuf

1606864393
FHUI KKI 2016

Analysis: Cambridge Analytica – Facebook data scandal

In recent years, social media has impacted the world very significantly. Social media has
connected the world and has also shaped it in many ways that no one has ever thought of. Social
media has also benefitted people around the world by connecting people as well as giving
people instant and easy access to information. However, despite social media’s advancement
and benefits, it also comes with its own issues and drawbacks.

Data subsequently has become one of social media’s most valuable byproduct, where
companies to even countries are willing to spend money to be able to acquire valuable data and
information. Data resulting from social media itself can be exploited for a variety of uses from
advertising to more recently and controversially, for political purposes.

Big data itself can be described as large and diverse amounts of information, that also grow in
in ever increasing rates and can be used for a variety of purposes. Big data also encompasses
the volume of information, the speed in which the information is created and the scope of the
data itself.

In recent years, data has been used for advertising in what is known as data-driven advertising,
it is where data is being used to serve advertisement and target specific demographics that is
suited for a specific advertisement. For example, a data-driven advertisement can target
specific age groups or regions that is best suited for the product or services that are being
offered. Which is why today whenever we browse for a certain item, we would sometimes see
advertisements of the same item appearing suddenly on sites that is not even related to the item,
this is an example of data-driven advertising where by using data gathered from personal
information available on social media platforms, advertisers can market their products and
services to the appropriate target demographic for that specific product or service. In turn
because of this, the advertising would become more efficient and would product the best results
for the advertisers. In fact Facebook is estimated to have earned 85% of their revenue from
advertising and the other source of income being data generation.

Despite its uses for commercial purposes such as advertising, big data has also recently been
controversially used for political purposes. Seeing as how big data by using personal data can
be used to efficiently advertised products, it can also be used to promote political campaigns,
ideas and opinions and this is how data was being used by firms like Cambridge Analytica
during the 2016 US Presidential Elections that led to the Cambridge Analytica – Facebook data
scandal.

Cambridge Analytica was basically a political consulting firm that used data mining and
analysis with their communication expertise to change political views and opinions to a
preferred group of people for their clients who are mostly political candidates, in this case most
notably being current US president Donald Trump. Data mining itself is basically a method of
collecting and using large databases to source information out of those data’s to be used for
specific purposes. In this case Cambridge Analytica used Facebook as their source of data since
Facebook has millions of users around the world and has the demographic that can be used by
Cambridge Analytica.

Despite Cambridge Analytica using Facebook to gather data, Facebook’s terms and conditions
actually state that Facebook does not sell personal data unless given specific permission. What
Facebook really does is provide advertising slots for advertisers to the kind of demographic
that the advertisers want and Facebook also provides performance feedback of those
advertisements as stated in their terms and conditions. However, Facebook had a way around
this to gather data for Cambridge Analytica who is not considered as an advertiser, which is by
creating and using an app called ‘This is your Digital Life’ to collect data of a significant
number of Facebook users. The application can be considered legal since it actually asked for
the users consent before using it, however the controversy came at how the data from the
application was being used afterwards.

What happened was that the application sold data to other companies which is not part of the
consent agreement with users and is also against Facebook’s own policies. One of the
companies that acquired this illegal data happens to be Cambridge Analytica who subsequently
exploited the data during the 2016 elections. The scandal only started after a whistleblower
who is a former employee of Cambridge Analytica spoke out regarding the issue.

When it comes to Facebook’s terms and conditions, it states that Facebook only shares personal
data when there is consent, as seen on a lot of Facebook apps including the This Is Your Digital
Life application data used by Cambridge Analytica. Facebook also states that they provide
advertisers with reports about the performance of their ads to help them understand how people
are interacting with their content on and off Facebook and they also state that they do not
directly identify individual users. Facebook also states that they share with third parties which
include advertisers, measurement partners, analytical services, law enforcement, researchers
and vendors, but they claim to not sell information and that there are strict restrictions on how
third parties can use and disclose data.

Despite the Cambridge Analytica scandal originating in the US due to the US Presidential
Elections, Cambridge Analytica was also involved with Leave.EU, an organisation which
supported the United Kingdom to leave the European Union which is also a right-wing
conservative movement much like Donald Trump’s campaign in the US elections. Hence, why
Mark Zuckerberg, CEO and Founder of Facebook had to testify in both the US and EU.

Therefore in the context of the EU, personal data is regulated in the GDPR (General Data
Protection Regulation). However, the Cambridge Analytica scandal happened in March 2018
and the GDPR was only implemented in May 2018, therefore it hasn’t been applied during the
time of the scandal.

However, if GDPR was implemented at the time, Facebook’s actions can be considered as a
negligence in their part and they could be subject to EU sanctions. The GDPR’s sanctions has
four levels which include a warning, suspension and two levels of fines. The first fine could
cost 2% of Facebook’s annual turnover and the second fine would cost 4% of Facebook’s
annual turnover. This means Facebook could fined around $1.4 billion for their part in the
scandal.
Meanwhile, in the context of Indonesia, personal data is regulated in Ministry Regulation No.
20 of 2016 regarding Protection of Personal Data in Electronic Systems (Permen 20 tahun
2016) particularly in Article 7 to 11 regarding the mining and collection of personal data which
itself is similar to the provisions stated in Facebook’s terms and conditions as well as their data
policy.

References:

1. “Data-Driven Advertising.” IAB. Accessed November 10, 2019.

https://www.iab.com/insights/data-driven-advertising/.

2. Segal, Troy. “The Deal With Big Data.” Investopedia. Investopedia, October 8, 2019.
https://www.investopedia.com/terms/b/big-data.asp.

3. O'Connell, Brian. “How Does Facebook Make Money? Six Primary Revenue Streams.”
TheStreet. TheStreet, October 23, 2018. https://www.thestreet.com/technology/how-
does-facebook-make-money-14754098

4. Rahulkalvapalleglobal. “Facebook App 'This Is Your Digital Life' Collected Users'

Direct Messages: Report.” Global News. Global News, April 13, 2018.
https://globalnews.ca/news/4143810/aleksandr-kogan-this-is-your-digital-life-
messages/.

5. “Data Policy.” Facebook. Accessed November 12, 2019.

https://www.facebook.com/policy.php.

6. “Facebook and Cambridge Analytica: What Would Have Happened with GDPR in
Force?” Panda Security Mediacenter, October 21, 2019.
https://www.pandasecurity.com/mediacenter/security/facebook-and-cambridge-
analytica-what-would-have-happened-with-gdpr/.

7. Peraturan Menteri Komunikasi dan Informatika Nomor 20/2016