Facebook Puts Permanent End to Select Partnerships with Third-Party Data Providers

Following Facebook’s recent privacy woes and breaches, the social media network has decided to mitigate further risks by cutting off access data brokers hitherto had to its multi-billion dollar ad platform.

Graham Mudd, Facebook’s product marketing director is quoted as stating, “We want to let advertisers know that we will be shutting down Partner Categories. This product enables third party data providers to offer their targeting directly on Facebook. While this is common industry practice, we believe this step, winding down over the next six months, will help improve people’s privacy on Facebook”.

The decision will affect third party brokers like Acxiom and Epsilon Data Management; both gather information to package and sell — at times to other data brokers, or perhaps to marketing agencies who would use insights from platforms like Facebook to hone their customer targeting.

This service brings in plenty of revenue as Acxiom is reported to have generated over $800 million in revenue just in 2017.

Data brokers are not a phenomenon nor is it new at that. Gathering data about your potential consumers has been around longer than the Internet. However the sensitivity of the information gathered has increased with the advent of the IT age. If in the good old days all companies knew were your habits about purchasing magazines and newspapers, now they can know very personal and confidential information like your sexual preferences, who your friends are and what shops you visited last week, because users share such intimate details on online social networks.

Companies that can afford to do so buy this data packaged neatly, and leverage it to target their potential consumers.

The feature soon to be phased out is called Partner Categories and was launched in 2013 in partnership with major data brokers.

Facebook has confirmed to media site TechCrunch “that the change is permanent, not a temporary precaution”.

To make the most of the massive amounts of data Facebook is able to gather from its users, it combines data collected from a user like what page did they most recently like with data from the advertiser themselves about perhaps a loyalty program for members, and with information from a third party.

Facebook on its part is said to feel “comfortable with the integrity of its data sourcing within the first two categories”, but not so much about business with third parties. Clearly it feels less certain about those aggregate pools of third party data given the recent Cambridge Analytica debacle.