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Europe Data Protection Digest | Notes from the IAPP Europe Managing Director, September 2, 2016 Related reading: Australia and Chinese Taipei join APEC's Cross-Border Privacy Rules System

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Greetings from Brussels!

There's been yet more focus of late on the digital super giants. Within 24 hours of WhatsApp announcing a wholesale new rethink of their approach to user data, the U.K.'s Information Commissioner announced she is to look into WhatsApp's decision to share more data with its parent company Facebook. To be clear on this, the move means WhatsApp users — provided they give their consent — could soon start seeing more targeted ads on Facebook; although not on the messaging service itself. The ICO will look into the changes WhatsApp has made to its privacy policy to determine if it is compliant and remains within the scope of U.K. data protection laws.

The move is a subtle but significant shift for the messaging app, which has long promised to safeguard the privacy of more than 1 billion users around the world. “The changes WhatsApp and Facebook are making will affect a lot of people. Some might consider it’ll give them a better service; others may be concerned by the lack of control,” said U.K. Information Commissioner Elizabeth Denham. She said the regulator will be considering whether the two companies are being transparent with users about how their data is being shared and used. The question that any regulator will be asking is whether or not the new policies and the way in which you opt in to them — or opt out of them — is expressed in clear language to the average user. While the disclosure is being made to users, clearly the ICO will ascertain for themselves whether it is transparent enough to the average user so you know exactly what it is you’re giving up. (And Denham will be speaking at the upcoming Data Protection Congress, by the way.)

From another perspective, another area of debate is the actual acquisition of the messaging service and how this might affect the WhatsApp/Facebook data-sharing arrangement if the two companies gave certain guarantees to regulators about how they would handle user data at the time of the acquisition — importantly, can it now be shown to be contrary to any earlier commitments? As I mentioned in previous MD Notes, the regulators have been much more active in looking at the M&A space, and looking at the privacy consequences more closely for M&A activity. Typically, the aim here is to determine failings by companies to respect data protection law, while creating an abuse of market position, equating to an unfair advantage over competitors. Either way you look at it, data sets are core assets these days and critical to market share; it is not simply their acquisition that needs to be examined, but how the acquirer intends to deploy them.

WhatsApp has long promised not to employ user data for advertising. Its acquisition two years ago sparked an outcry from privacy activists who were worried that Facebook would start mining WhatsApp accounts. And while both companies pledged WhatsApp would operate separately from its parent, the Federal Trade Commission warned them publicly, in a 2014 letter, against changing how they employ WhatsApp user data without users' consent. WhatsApp says current users have up to 30 days to accept the new policy terms or stop using the service. Once they accept, they have 30 more days to opt out of sharing with Facebook.

From a business standpoint, to be honest, you can understand why Facebook is looking to integrate WhatsApp into its digital business model, having bought the service in a deal ultimately worth $21.8 billion. This was surely in the cards in some form or other at the time of acquisition. From an advertising standpoint, the ability to target existing or prospective customers with more relevance and precision should be greatly improved through this new arrangement, rendering Facebook’s ability to bolster its advertising offerings. Some will appreciate it, and some will worry about being "over exposed" and that too much personal data is being increasingly processed and used to determine and shape how you experience Facebook. In the end, from a consumer vantage point, it boils down to your consent; and provided terms & conditions are clearly stated and informed, users will be empowered to ultimately choose their path — personalized supply & demand in action. 

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