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Facebook paid users to collect data from their phones

Since 2016, Facebook had paid people between the ages of 13-35 to collect data on their smartphone usage, according to TechCrunch.

This is yet another black eye for embattled social media giant Facebook (FB).

For up to $20 a month plus referral fees, the tech company had access to these participants’ web browsing histories, locations, and even messages, videos, and photos exchanged through the instant messaging app on both Android phones and iPhones, according to a TechCrunch investigation.

The app was called “Facebook Research” and through the VPN, the company was able to collect all of the data it needed. Facebook used beta-testing services Applause, BetaBound, and uTest and operated under the name “Project Atlas” to mask the company’s direct involvement, according to TechCrunch.

CORRECTING DATE OF ANNOUNCEMENT TO WEDNESDAY - FILE - In this file photo dated Tuesday, Aug. 21, 2018, a Facebook start page is shown on a smartphone in Surfside, Fla. USA.  The social media giant Facebook said late Wednesday Aug. 22, 2018, it has banned a quiz app for refusing to be audited and concerns that data on as many as 4 million users was misused, after it found user information was shared with researchers and companies. (AP Photo/Wilfredo Lee, FILE)
In this file photo dated Tuesday, Aug. 21, 2018, a Facebook start page is shown on a smartphone in Surfside, Fla. USA. (AP Photo/Wilfredo Lee, FILE)

Initially Facebook vigorously defended the entire operation, but shortly after announced that it would be ripping the app from iOS devices.

“Key facts about this market research program are being ignored. Despite early reports, there was nothing ‘secret’ about this; it was literally called the Facebook Research App,” a spokesperson for Facebook said in a statement to Yahoo Finance. “It wasn’t ‘spying’ as all of the people who signed up to participate went through a clear on-boarding process asking for their permission and were paid to participate. Finally, less than 5 percent of the people who chose to participate in this market research program were teens. All of them with signed parental consent forms.”

On the back of the reports of alleged spying by Facebook, Apple (AAPL) has responded by banning that application.

Facebook has been grappling with data privacy and misinformation scandals and has been struggling to get back in the good graces of investors, Wall Street, and legislators in Washington.

The social media titan is scheduled to report earnings after the bell on Wednesday, and CEO Mark Zuckerberg will take the spotlight as the public attempts to understand how the company is planning on dealing with its growing list of woes.

While the stock has been beaten down over the past year, Facebook shares were up about 2% as of 10:47 a.m. ET and have climbed 19% from their Christmas Eve lows.

Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter: @heidi_chung.

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