San Francisco: Earlier this month, social media platform X, once known as Twitter, did something interesting with its Privacy Policy. Now, the company can grant third-party collaborators the license to use its users’ data to train artificial models. This move by the company has been effective since November 15, as the company pursues new revenue streams due to persistent financial challenges and decreased advertising revenue.
New Policy Allows Third-Party AI Training
The new Privacy Policy articulates Section 3 “Sharing Information” to explain how data collected from X users might be shared with third parties. In these new policies, unless the users opt out of the deal directly, third-party collaborators can use this information to develop their AI models. This is a major pivot for the platform since it will monetize data by licensing them to AI companies, the likes of which have already been seen in action at Reddit and a few media organizations.
The new policy says: “Depending on your settings, or if you choose to share your data, we and our third-party service providers may share or disclose your information with third parties. If you don’t opt out, in some cases, the recipients of the information may use it for their independent purposes, including, for example, to train their artificial intelligence models.
How to Opt-Out of Data Sharing
Currently, X’s settings page offers no clarity as to where a user might go to turn off this data-sharing feature. The current “Privacy and safety” section in settings would only allow users to manage data sharing with xAI’s Grok and business partners in engaged product development. It is expected, however, that new features will allow opting out of data sharing with AI providers when the policy takes effect by November 15.
Data Retention Changes and Public Content Disclaimer
X has even updated the terms of data retention policies. In the past, it indicated it would retain information from user profiles or personally identifiable data for no longer than 18 months. Now the new policy says: “Data retention varies as a function of the type of information and the need to perform services, ensure compliance or security.”.
For example, user-generated content and interactions shall be retained for as long as the account is active or until its deletion. X has also argued that even if the user had deleted such content from the platform, copies of the content would be stored in the servers of the search engines and third-party services as part of their retention policies on data.
Liquidated Damages for Violation through Scraping
X has adopted a new “Liquidated Damages” clause under its Terms of Service to ensure that its data won’t be accessed improperly. The clause specifically targets companies and directs a charge of USD 15,000 per 1,000,000 posts with access to over 1,000,000 posts within 24 hours to an entity. This policy seems to be centered squarely on blocking the bulk data collection by others.
Financial Pressures Prompt Monetization of Data
The shift to enable AI training by scraping user data and efforts to penalize scraping content is a strategic maneuver by X to pave the way for new revenue streams. After Elon Musk acquired the application, X faced a mass withdrawal of advertisers and faltered on its subscription-based model. The policy changes must probably be a consequence of the company business need to diversify its sources of income as it looks to exploit a mass database of interactions and talks with its desire to entice AI companies willing to pay for valuable data.
EU Scrutiny and Legal Implications
The move comes when the European Union’s lead privacy regulator opened an investigation into how X used user data to train its Grok chatbot for the xAI service. Now that X is opening third-party use, the company is most likely to be targeted seriously by international data protection authorities concerned with user privacy and whether such practices comply with international data laws.
Looking Forward
It is not too early to foretell how the users would act when their data is being used for training AI models and going live with these new policies. Clear communication on the opt-out procedure of data used by X will be paramount for maintaining the trust between the users and X as more and more data privacy becomes a concern.
This strategy is being implemented in light of when tech companies are thinking about monetizing data in multiple ways while leveraging the advancement of AI. Against this backdrop, the new strategy by X will likely alter how the rest handle user data in the age of AI.
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