The New York Times reported Sunday that Facebook allowed the preferred access to certain device makers, such as Apple Inc. , Amazon Inc. (AMZN) - Get Report Microsoft Inc. (MSFT) - Get Report and Samsung Electronics Co. (SSNLF) , over a number of years as the firm sought to expand its influence in the social media marketplace. The paper said some of the access, however, may have violated portions of a 2011 consent decree with the Federal Trade Commission given that Facebook shared the user data -- and in some cases the data of users' friends -- without first obtaining specific consent.
"While we agreed with many of their past concerns about the controls over Facebook information shared with third-party app developers, we disagree with the issues they've raised about these APIs," Facebook said in a Sunday blogpost. "Given that these APIs enabled other companies to recreate the Facebook experience, we controlled them tightly from the get-go. These partners signed agreements that prevented people's Facebook information from being used for any other purpose than to recreate Facebook-like experiences."
Action Alerts PLUS holding Facebook shares were marked 1.4% lower in pre-market trading in New York Monday, indicating an opening bell price of $191.34 each, a move that would trim its year-to-date gain to around 8%.
The Times also reported that Facebook had "exempted the makers of cellphones, tablets and other hardware" from the kind of restrictions it placed on developers attempting to access user data that were put in place following its discovery, in 2015, the Cambridge Analytica had obtained information on 87 million customers that ultimately led to the company's biggest-ever scandal and a series of "mea-culpa" appearances before lawmakers in Europe and the United States by CEO Mark Zuckerberg.
Facebook rebounded from that, however, when it posted first quarter earnings in late April that showed little impact from either that scandal and suggested changes to its newsfeed haven't discouraged users from joining the platform.
Facebook, which takes nearly a fifth of global digital ad revenue, posted record sales of $11.97 billion over the first three months of the year and a bottom line of $1.69 a share that blasted Wall Street estimates.