Case Study #3: Transparency Reporting

Transparency reporting by internet companies first emerged in 2010 when Google published its first report, focused on government requests for data and for content takedowns both in the US and internationally. China played a key role in that decision, just as it played a key role in Google’s first-mover offerings of transit encryption by default and two-factor authentication; so too did Google’s desire, shared with a range of companies and privacy advocates, to reform the U.S. law governing when the police could demand data from online service providers.

Over the next three years, a slow trickle of major companies like LinkedIn and Microsoft followed Google’s example—including Twitter, where former Google employees sought to build on their original employer’s work. However, the practice didn’t truly become a standard until Edward Snowden’s revelations in the summer of 2013 about NSA surveillance prompted a crisis in consumer confidence around U.S. companies' handling of private data. To address that crisis, within a year of the Snowden leaks, almost all of the major online service providers—and, for the first time, phone and cable companies—were publishing detailed reports about government demands for data.  This explosion in reporting was concurrent with a major legal and political fight where the Internet industry and privacy advocates joined together to demand that companies be allowed to publish basic numerical data about the national security-related requests they received from the U.S. government, ultimately leading to transparency reforms in the USA FREEDOM Act of 2015.

With the Snowden revelations accelerating the rate of adoption, transparency reporting has gone from something only one company did in 2010, and which only a small handful of companies did before the summer of 2013, to a standard best practice that has been adopted by over fifty U.S. internet and telecommunications companies as well as a growing number of international companies.

As transparency reporting has become a standard practice in the internet industry, certain features have become standard as well. The most consistent feature across all transparency reports is a section on government requests for user or customer data. This is no surprise given the close ties that the emergence of transparency reporting has with the Snowden revelations. However, other sections have also become standard in many companies’ reports. For example, a vast majority of internet companies now report some information on Digital Millennium Copyright Act (DMCA) takedowns. Another increasingly common feature of transparency reports is inclusion of data about government requests to remove content. However, no companies are yet publishing comprehensive data about the content they take down based on their own terms of service, although demand for such reporting is growing.

Over fifty U.S. internet and telecommunications companies have taken up transparency reporting in the handful of years since Google released its first report, and with each iteration, many companies have added new features, content, and data points. Though it is hard to predict what the next generation of transparency reports will bring, there are a few areas that may see increased attention in the future, namely: terms of service (TOS) enforcement and greater standardization across reports.

Notably absent from nearly every single transparency report is information about TOS enforcement. Until July 2015, when Etsy published its first transparency report, no company was reporting any data on the enforcement of internal policies. Since then, the only other company to share data about TOS enforcement as part of its transparency report is Twitter, which in February 2016 added information about certain types of content removed due to violations of the platform’s policies. Especially due to concerns about extremist content online, transparency around internal policies that impact users’ freedom of expression is becoming increasingly important, and there is growing pressure outside the industry—and, hopefully, some desire inside the industry—to offer that transparency sooner rather than later.

Meanwhile, although transparency reporting has flourished in recent years and companies have experimented with innovative and new approaches to reporting, the practice has also suffered from a lack of consistency that has limited reports’ usefulness. Due to different accounting and reporting practices, and a lack of clarity about exactly how companies are counting or defining certain terms, it is difficult for data across companies to be compared or combined. As a result, there has been a growing call for companies to start standardizing how some of the most common transparency reporting features are deployed. One representative effort is the Transparency Reporting Toolkit designed by the Open Technology Institute and the Berkman Klein Center For Internet & Society, which offers a model standardized reporting format based on an extensive survey of the best practices in the field.