--:-- [Sound of a podcast intro]
--:-- Sean Rameswaram: Welcome to Today Explained. I'm Sean Rameswaram.
--:-- Noel King: And I'm Noel King.
--:-- Sean Rameswaram: Today, we're talking about Facebook and Apple. Facebook has been paying 13- to 35-year-olds $20 in exchange for access to their phones, and Apple isn't happy about it. Our guest is Casey Newton, the Silicon Valley editor at The Verge.
--:-- Casey Newton: Thanks for having me on the show.
--:-- Sean Rameswaram: So, let's start with the basics. What's going on here?
--:-- Casey Newton: Facebook had a marketing research division that was doing something really unusual. They created an app called Facebook Research, and then they would use various intermediaries to find people who were between the ages of 13 and 35. And what it would ask them to do is install a root certificate on their phones that would then provide Facebook with access to really all of their most intimate data.
--:-- Noel King: That sounds like a lot of personal data. What kind of data are we talking about?
--:-- Casey Newton: Where they went on the web, what emails they sent, who they were texting, how much they were using, all of the various apps that are on their phones.
--:-- Sean Rameswaram: And in exchange for this data, Facebook was giving these users $20 a month.
--:-- Casey Newton: That's right. It was a gift card, essentially. And the reason that Facebook was doing it was for competitive research purposes.
--:-- Noel King: So, Facebook was trying to figure out what its competitors were up to.
--:-- Casey Newton: Exactly. Back in 2013, Facebook bought an app called Onavo. It was an Israeli company that made a virtual private network. Onavo was a free security app that lets users access virtual private networks or VPNs to try and browse and download other apps with a greater degree of privacy.
--:-- Sean Rameswaram: And what was Onavo really doing in the background?
--:-- Casey Newton: It was using that data for market research purposes. So it would sell that to companies who wanted to know, hey, what are the up and coming apps? What's going to be the next big app?
--:-- Noel King: And that's valuable information for Facebook.
--:-- Casey Newton: Yeah. So, Facebook bought Onavo and ever since has used it as kind of an early warning system to determine what threats might be on the horizon.
--:-- Sean Rameswaram: Okay, so there's this app called Onavo that helps people protect and minimize their data usage. Facebook buys it because Facebook wants to know what apps you're using. What happens next?
--:-- Casey Newton: Last year, after some reporters had written about what a valuable tool this is for Facebook, Apple took an interest in it. And just last year, Apple said, you know what? We're not comfortable with how you're using this data that you're collecting. And so we're going to kick Onavo out of the app store.
--:-- Noel King: And what happened after that?
--:-- Casey Newton: Facebook releasing a statement saying, we've always been clear about the information that is collected and how it is used. As a developer on Apple's platform, we follow the rules that they've put in place.
--:-- Sean Rameswaram: But it sounds like Facebook was trying to find a way to collect this data without Apple's permission.
--:-- Casey Newton: Yeah, that's right. So Facebook's kind of cornered. What does it do next?
--:-- Noel King: So, in 2016, Facebook started asking users to let them install these root certificates on their phone, giving up their most sensitive data. And in exchange, Facebook gave them a $20 monthly gift card.
--:-- Casey Newton: That's right. And the reason that Facebook was doing it was because it couldn't use Onavo anymore.
--:-- Sean Rameswaram: And what's the problem with this?
--:-- Casey Newton: Well, some people say this is a good bargain because, you know, they've been using Facebook forever and they haven't gotten paid a dollar. But a lot of other people are concerned about the kind of intrusive access that Facebook is requesting to in some cases, vulnerable teenage populations who might really need the $20, but maybe don't have a complete sense of what they're giving up.
--:-- Noel King: And what's the issue with the way that Facebook is getting parental consent?
--:-- Casey Newton: Well, the way that you confirm that you have your parents' permission is just kind of like tapping twice on a screen. Like it's not your parents tapping twice on the screen. You just do it, you, the 13-year-old?
--:-- Sean Rameswaram: Yeah, exactly. You don't have to hold up the phone to your parents' face and do a retina scan to make sure that it's them. What the heck?
--:-- Noel King: So, why 13 to 35-year-olds? Just because that's like a desired demographic?
--:-- Casey Newton: Exactly. That's where the money is. And that's the demographic that is typically hardest for advertisers to reach, right?
--:-- Sean Rameswaram: And that's why Facebook has been trying to develop these really rich profiles of what, you know, teenagers and young adults do on their phones.
--:-- Noel King: Is anything here illegal or is it just angering people because it's sort of dodgy to be asking teenagers for all their information with probably some, you know, only perfunctory parental consent?
--:-- Casey Newton: It wasn't illegal, but it did violate an Apple policy.
--:-- Sean Rameswaram: And this is where I think the story gets really wild. Apple enables developers to test any apps they want among their own employees. And there's a specific rule in the requirements that Apple laid out that says you are not allowed to use this to test apps with customers.
--:-- Noel King: And Facebook enacted this program using the employer root certificate program.
--:-- Casey Newton: So in other words, they took a program that was supposed to be used for helping employers test apps with their own employees, and they deployed it to an unknown number of customers in the real world.
--:-- Sean Rameswaram: And so as soon as Apple found this out last night, they yanked the certificates, and that's causing havoc at Facebook this morning.
--:-- Noel King: Like what kind of havoc?
--:-- Casey Newton: So you think about Facebook has something like 30,000 employees. All of them have the certificate installed on their phones and all of them use the developer app, right? So they're using the version of Facebook that hasn't yet been released to the public.
--:-- Sean Rameswaram: Every single employee at Facebook who is working on some new feature in the app, some app that hasn't been released yet, or even just internal apps that help them navigate campus like the shuttle app. If you tap those on your phone, those just don't work anymore.
--:-- Noel King: So if you have an iOS device at Facebook today, it's going to be very difficult for you to get any work done.
--:-- Sean Rameswaram: And so to me, it just seems wildly reckless that this is how Facebook went about collecting this kind of data.
--:-- Noel King: Is this going to create bad blood between Facebook and Apple or is that already there?
--:-- Casey Newton: It's there, but it's a major escalation of the tension between the two companies.
--:-- Sean Rameswaram: Coming up, Apple versus Facebook. Infinity War. No, no, Dawn of Justice. I don't know, they're mad at each other.
--:-- Noel King: [laughs]
--:-- Sean Rameswaram: But seriously, what does this mean for Facebook? Are they just going to have to apologize again? Or are they going to have to put another ad saying, like, we're changing, we're getting back to being friends?
--:-- Casey Newton: Well, I'll tell you, their first statement about this was not very apologetic.
--:-- Noel King: You know, I emailed them on Tuesday afternoon, and they didn't get back to me until about 2 a.m. Eastern time with their statement.
--:-- Sean Rameswaram: And the statement was very punchy. And it disputed aspects of the original report.
--:-- Casey Newton: Yeah, that's right. And they notably did not apologize.
--:-- Noel King: And they very much presented this as a kind of garden variety market research program.
--:-- Sean Rameswaram: It feels like Silicon Valley is on the forefront of so much in our culture. And yet when it comes to navigating public opinion, they seem to keep falling on their faces.
--:-- Casey Newton: Like even this whole FaceTime thing with Apple, they didn't acknowledge this complaint from this mother until everyone else had picked up this story.
--:-- Noel King: Why is it that they're so bad at transparency?
--:-- Casey Newton: I think at Facebook, there is this unshakable belief that eventually everyone is always basically okay with almost everything they do.
--:-- Sean Rameswaram: Every time they have made a move in the past that some people have complained violates privacy, over a long enough time period, most people just shrugged.
--:-- Noel King: And so it just kind of got baked into the culture that there were always going to be people yelling at them over privacy issues.
--:-- Casey Newton: And if they just stood fast, eventually it would all blow over.
--:-- Sean Rameswaram: Most companies have what PR people like to call the headline test, right? Which is if the whole world knew about this, if it were on the front page of the New York Times, what would be the consequences for you?
--:-- Noel King: And abusing the Apple developer system in a way that would jeopardize the internal testing of every single program at Facebook just to know what a 13-year-old is doing on their iPhone, that doesn't pass the headline test.
--:-- Sean Rameswaram: Casey Newton writes about social media and democracy for The Verge. He's got a killer newsletter. It's called The Interface.
--:-- Noel King: I'm Sean Rameswaram.
--:-- Sean Rameswaram: And I'm Noel King.
--:-- Noel King: This is Today Explained. Thanks for listening.
--:-- Sean Rameswaram: Thanks for listening.
--:-- [Sound of a podcast outro]
