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South Korea Fines Meta about $15 Mln over Collection of User Data

A 3D printed Facebook's new rebrand logo Meta is placed on laptop keyboard in this illustration taken on November 2, 2021. (Reuters)
A 3D printed Facebook's new rebrand logo Meta is placed on laptop keyboard in this illustration taken on November 2, 2021. (Reuters)
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South Korea Fines Meta about $15 Mln over Collection of User Data

A 3D printed Facebook's new rebrand logo Meta is placed on laptop keyboard in this illustration taken on November 2, 2021. (Reuters)
A 3D printed Facebook's new rebrand logo Meta is placed on laptop keyboard in this illustration taken on November 2, 2021. (Reuters)

South Korea has ordered Facebook owner Meta Platforms to pay 21.62 billion won ($15.67 million) in fines after finding it had collected sensitive user data and given it to advertisers without a legal basis, Seoul's data protection agency said.

The US tech giant obtained information from about 980,000 South Korean Facebook users on issues such as their religion, political views and sexuality while failing to seek agreement from users, the Personal Information Protection Commission said in a statement on Tuesday.

The information was then used by some 4,000 advertisers, the agency said.

A Meta Korea official declined to comment.

"Specifically, it has been found that (Meta) analyzed user behavior data such as pages they liked and advertisements they clicked on Facebook and created and managed advertising themes related to sensitive information," the commission said.

This included users being categorized for example as being North Korean defectors or following a certain religion, the agency said.

Meta had also unfairly declined a request by users to access personal information and failed to prevent data on about 10 South Koreans from being leaked by hackers, the agency said.

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Meta Shows Strong Growth as AI Spending Surges

The Meta logo is seen at the Vivatech show in Paris, France, Wednesday, June 14, 2023. (AP)
The Meta logo is seen at the Vivatech show in Paris, France, Wednesday, June 14, 2023. (AP)
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Meta Shows Strong Growth as AI Spending Surges

The Meta logo is seen at the Vivatech show in Paris, France, Wednesday, June 14, 2023. (AP)
The Meta logo is seen at the Vivatech show in Paris, France, Wednesday, June 14, 2023. (AP)

Facebook owner Meta saw net income and revenues top expectations on Wednesday as the company said it would expand investments into artificial intelligence, drawing nervousness from investors.
The social media behemoth, which is also the parent company of Instagram and WhatsApp, said net profit in the third quarter was $15.7 billion -- up 35 percent on the same period last year, AFP said.
Revenues rose 19 percent to $40.6 billion, slightly higher than analyst estimates.
But investors sent Meta shares lower in after hours trading over the outlook for AI spending in the months ahead and another big loss at its virtual and augmented reality arm, Reality Labs.
"Our AI investments continue to require serious infrastructure, and I expect to continue investing significantly there, too," Meta's founder and chief executive Mark Zuckerberg told analysts.
"We haven't decided on a final budget yet, but those are some of the directional trends," he added.
Meta's share price slipped nearly three percent after its earnings results were published.
Like its Big Tech peers, Meta is rushing into artificial intelligence as it tries to build revenue streams away from its social media core business.
In recent months Zuckerberg has put most of his attention and spending on the company's AI innovations that have been rolled out as chatbots across its platforms or used to upgrade its ad tech.
On Wednesday, Meta once again raised its capital investment outlook: for 2024 alone, it is forecasting a range of $38-40 billion, compared with $37-40 billion previously, much of it for AI.
'Rising costs'
Investors "were a little disappointed by the rising costs" said Jasmine Enberg of Emarketer.
"It's going to take longer time to pay off" than some had hoped, she added.
In the first quarter this year, the spending had already caused concern among investors, despite a doubling of earnings.
But a quarter later, Meta's results impressed investors with a further surge in profits, showing that its core ad business could support the investments.
"Meta's solid revenue growth in the quarter will help stave off investor concern about its AI investments," said Debra Aho Williamson of Sonata Insights, who added that these investments were making it easier to post ads on the platforms.
However, she warned, that the full impact of consumer facing AI "won't be felt until 2025 or beyond."
Reactions were positive last month when the company unveiled its Orion augmented reality glasses, which remain experimental but bolstered confidence that Meta will be a leader in the AI wearable space.
Meta also hopes to ride on the excitement of its Ray-Ban Meta smart glasses, which it developed with EssilorLuxottica, the European eyewear giant.
Analysts believe that the glasses could be a hot item during the end-of-year holiday season.
But the recurring losses at Reality Labs, the VR division, continued to weigh on investors minds. The division posted $270 million in revenues in the third quarter -- and $4.4 billion in operating losses.