Facebook Developer Terms: Is there a lawyer in the house?

If I asked you whether you were concerned about privacy on facebook, what would come into your mind? Many people are thinking about personal information, and how that information will be collected and used. I won’t wade too deeply into personal information privacy, but I would like to examine another aspect of facebook: Intellectual property protection for application developers.

About a year ago, Facebook released F8, which in many ways is a brilliant step forward: an open, easily accesible platform, with access to 75 million users and growing every month. While ad revenue has not met with high expectations (econ, wsj), Facebook has done a good job of the revenue sharing concept, whereby you can essentially keep most if not all of the ad revenue generated by impressions and clicks on a Facebook app that you build and host. If they wanted an ecosystem, they got it. Hats off to them for this.

What’s troubling me though are a few paragraphs in the Developer Terms of Service:

Section 4. Ownership and Licenses
As between you and Facebook: (a) you retain all right, title and interest in and to, and Facebook obtains no rights of any kind (other than the rights and licenses expressly granted in this Agreement) in, Facebook Platform Applications you create and in the Facebook Platform Application Content, and all associated Intellectual Property Rights (subject to Facebook’s underlying rights in Facebook Platform and Facebook Site);

(emphasis is mine)

This all makes sense so far. So if I write an app, I own the app. But then a couple of phrases in the next paragraph are a little harder to interpret:

By accessing Facebook Platform, or submitting any Facebook Platform Application to us to be hosted by us, you are directing us to store copies of that Facebook Platform Application (if applicable) and any and all Facebook Platform Application Content provided through any Facebook Platform Application on our servers. You hereby grant us a worldwide, perpetual, irrevocable, non-exclusive right and license, with the right to sublicense, to: (a) access, reproduce, display, distribute, perform, and store on our servers your Facebook Platform Application and any Facebook Platform Application Content, and to create derivative works of Facebook Platform Application Content, as may be necessary or desirable to make such Facebook Platform Application and Facebook Platform Application Content available to Facebook Users in accordance with the terms of this Agreement and the Facebook Platform Documentation and the Facebook Platform Application Guidelines; and (b) otherwise access, use and analyze any Facebook Platform Application Content for our internal business purposes (e.g., for the purposes of targeting delivery of advertisements or other content to persons who have viewed particular types of Facebook Platform Application Content). You understand and agree that Facebook Platform Application Content that is displayed on the Facebook Site may continue to appear on the Facebook Site, even after you have terminated access to your Facebook Platform Application or terminated this Agreement, as such Facebook Platform Application Content may have been incorporated into user profiles, news feeds or other features, and that such usage may continue indefinitely.

So let’s see… if iLike, an app that allows me to share my favorite music and artists with my friends, collects a whole bunch of data about what music is enjoyed by which friends, who owns the data (Facebook Application Content)? By the first paragraph, the iLike publishers should own the data, but later on, Facebook retains the right to use such content for its purposes, including targeted advertisements or other content.

So, dear reader, what is the real incentive to iLike, or Slide and RockYou, to collect this data, only for it to be used by Facebook? I will be investigating this issue more closely, but I would welcome your input! Am I reading this right? What am I missing? How would you feel about Facebook grabbing your data?

And more to the point, are investors concerned? You know, the ones who put up $50M for a company that writes an application that, um, is a better, um, , no, more fun, or super, yes, a more super wall than the um, plain old regular wall in facebook?

Alan (alan AT eigenpartners DOT com) 


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