The short message service had asked users for contact details on the grounds that they wanted to better secure accounts in this way.
(Photo: dpa)
austin According to allegations by the US government, Twitter used user contact data for advertising – which is now costing the online service $150 million. Twitter agreed to a fine of this amount to settle a data protection lawsuit by American authorities.
In the lawsuit, released Wednesday, the FTC and the Justice Department allege that Twitter asked users for their phone numbers and email addresses on the grounds that it would help secure their accounts. Online services access e-mails or messages to mobile phone numbers, for example to register on new devices, forgotten passwords or to unlock blocked profiles again. Twitter also used the data to show users personalized ads, the lawsuit said. The contact information collected for other purposes was thus misused.
Between May 2013 and September 2019, more than 140 million users shared their phone numbers or email addresses with Twitter, the US government said. She saw the service’s approach as a violation of an agreement from 2011, in which Twitter had committed itself, among other things, to transparency in data protection. The service was therefore considered a repeat offender by the government, which opened the door for a hefty payment.
With 150 million dollars (140 million euros), however, Twitter comes off significantly cheaper than Facebook in 2019. At that time, US authorities also accused the world’s largest online network of having violated previous data protection obligations. Facebook paid five billion dollars and agreed to stricter data protection supervision. Among other things, Twitter must now have data protection checked by experts appointed by the FTC and report incidents to the authority within 30 days. In addition, Twitter is said to offer a method for secure registration that works without a telephone number.
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The fine and the new conditions come in the middle of tech billionaire Elon Musk’s takeover attempt on Twitter. The deal is already not going well: Musk recently declared the takeover agreement to be suspended. He justified this with the suspicion that the proportion of spam and bot accounts was higher than the estimates given in official reports of less than five percent. From Twitter’s point of view, however, Musk cannot unilaterally put the deal on hold – and the service insists on the deal.
Musk reallocates funding
On Wednesday, investors drew a little more hope that the deal would eventually go through. Musk shifted his funding. He doesn’t want to take out loans secured with his shares after all. Originally, he wanted to get $ 12.5 billion (11.7 billion euros) in this way. However, a statement from the US Securities and Exchange Commission said that Musk wanted to contribute this amount in another way. The boss of the electric car manufacturer Tesla had presented financing commitments of over 46 billion dollars for the Twitter deal.
The Tesla boss wants to continue to secure funding for the Twitter deal.
(Photo: AP)
The waiver of the equity-backed loans had already been expected after the Tesla paper price had fallen significantly. After the switch, Musk now wants to contribute $33.5 billion in addition to other loans. In order to raise this amount, he has already brought various investors on board.
According to the statement, Musk also wants to talk to longtime Twitter boss Jack Dorsey about bringing his shares into a deal to continue to be involved in Twitter after the acquisition is complete. According to the latest information, Dorsey holds around 2.5 percent of Twitter, Musk has bought a good nine percent share in recent months.
Industry analyst Dan Ives saw the switch as good news. Musk is continuing to work on the funding and the change is a “good move” that will ease the burden on Twitter after the takeover, the pundit at finance firm Wedbush wrote.
The Twitter share temporarily rose by around six percent in after-hours trading after the announcement was published. At a good $39, the price was still well below the $54.20 per share that Musk had promised the shareholders.
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