Facebook to clarify data rules for ads

Facebook Inc is proposing to clarify how it manages user data for advertisements, as part of an agreement stemming from a settlement of a class-action lawsuit.

The company, owner of the world’s largest social-networking service, said it is working to provide simpler language on how it may use a member’s name, profile picture and other data for ads. Facebook also plans to add a provision that says minors will verify that a parent or guardian has consented to them being part of such ads. “The goal here is to be very clear with people about how advertising works on Facebook,” Erin Egan, chief privacy officer for policy, said.

Facebook is seeking to reassure its 1.15bn users about how it manages and protects member information amid efforts to retain its consumer base and sustain revenue growth. The company has faced multiple privacy flaps over the past few years, which it has taken steps to address. In late 2012, it unveiled new privacy tools that provided shortcuts for managing settings, including what members can see on user accounts.

The new proposals reflect some of the agreements laid out in the lawsuit settlement for the company’s “Sponsored Stories” ads, which access users’ names and other data to help create ads.

The 2011 lawsuit accused Facebook of appropriating the names, photographs and identities of users to advertise products without their consent. “Sponsored Stories” was a “misleading advertising scheme” using material posted by Facebook users on their profile pages, according to the complaint.

The settlement called for better explanations of the company’s advertising policies and new requirements for minors’ data.

Facebook is proposing changes to two legal documents, its “Data Use Policy” and the “Statement of Rights and Responsibilities.” The updates include more information on how outside applications may use data and how the company gathers information on members from mobile devices.