Zuckerberg’s Take on Facebook’s History Raises Eyebrows

In a post musing about Facebook’s 15 years of existence, CEO Mark Zuckerberg positioned the platform as a David confronting a Goliath composed of hierarchical institutions.

Facebook gives the masses a voice, he wrote. It brings communities together and provides businesses with low-cost means of outreach.

Progress has been made in addressing the new social and ethical issues raised, including protection of privacy, according to Zuckerberg.

The amount Facebook will spend on safety and security this year will surpass its entire revenue at the time of its May 2012 IPO, he noted.

Facebook’s Q2, 2012 revenue — just after its IPO — totaled nearly US$1.2 billion.

Zuckerberg blasted critics who “overly emphasize the negative” and contend that social media networks’ empowering of people is “mostly harmful to society and democracy.”

His comments did not sit well with many industry observers.

“Facebook is not about any higher principles,” maintained Michael Jude, program manager at Stratecast/Frost & Sullivan.

“It has always been about how to utilize 2.3 billion subscribers’ personal information to generate money,” he told the E-Commerce Times.

Zuckerberg “is pretending that he’s Robespierre leading the charge on the Bastille, when in fact he is a cowboy watching a stampede of disgruntled cattle descending on him,” Jude quipped.

Cambridge Analytica Fallout

User resentment at Facebook’s privacy practices had been fairly constant until the Cambridge Analytica scandal erupted last year.

Facebook had sat on reports about the CA issue since 2015, and its shares fell by more than $100 billion within days after the scandal broke. Politicians in the United States and the UK demanded answers. Zuckerberg had to testify before U.S. Senate Commerce and Judiciary Committees, and the following day was subjected to tough questioning by members of the U.S. House Energy and Commerce Committee.

The scandal gave a boost to the #DeleteFacebook hashtag, which trended in 2018 for a number of reasons, including the prevalence of hate speech on Facebook, the spread of fake news on the platform, the hacking theft of 29 million Facebook users’ personal information, and the Cambridge Analytica scandal.

Seventy-four percent of the 4,600 Facebook users surveyed by Pew Research last year said they had adjusted their privacy settings, avoided logging on for at least several weeks, or deleted the Facebook app from their cellphones.

Facebook engagement has been declining in South America, Europe, Russia and Africa, according to a Global Equity Research report released last month. While it remains the most popular social network, year-over-year overall engagement growth was 2.25 percent in Q4 2018, the lowest among all social networks.

Although people have quit Facebook in droves, millions of companies and organizations worldwide have activated the Facebook pixel on their websites. This records Facebook users’ activity on the websites and sends the data back to Facebook, which uses it for targeting ads.

Also, Facebook’s offline conversion measurement solution lets advertisers track the offline activity of users after they see or click on a Facebook ad.

“Facebook has been ingenious in the way it leads users into providing personal information,” observed Steve Wilson, principal analyst at Constellation Research.

It has “extracted biometric data by getting users to tag themselves and their friends in photos,” he told the E-Commerce Times. “Facebook crowdsources and gamifies the calibration of their biometric algorithms.”

Preying on Children

Children’s advocacy groups for years have argued that Facebook preys on kids. When the company launched Messenger Kids in 2017, for use by children as young as five, it “did not consult with privacy and child welfare advocates,” said David Monahan, campaign manager for the Campaign for a Commercial-Free Childhood.

Facebook knew advocates “would tell them it was bad for kids’ well being to get them hooked on social media at a young age,” he told the E-Commerce Times.

Instead, it “went to one or two groups who receive Big Tech funding and used their positive feedback to give them cover,” Monahan said.

Facebook orchestrated a multiyear effort duping kids and their parents out of money and often refused to refund the victims, suggest internal Facebook documents unsealed last month by the U.S. District Court, Northern District of California, in response to a legal action by Reveal.

Facebook apparently encouraged game developers to let kids spend money without their parents’ permission, which it termed “friendly fraud.” In some cases, kids reportedly ran up bills totaling thousands of dollars.

For years, Facebook seemingly ignored employees’ warnings that it was defrauding kids.

“It’s shameful to think that Facebook would see unsuspecting children as ripe targets for friendly fraud, and even discourage developers from coming up with ways to prevent kids from making unauthorized charges,” Monahan said.

People should use parental control settings “on every device, to restrict and monitor purchase activity,” advised Monica Eaton-Cardone, chief operating officer of Chargebacks911.

If a child uses a social media or game account, “set up a prepaid card for that use only, with a set limit,” she told the E-Commerce Times.

Tapping the Teen Market

Another scandal erupted last month over a report that Facebook was paying users — many of them teens — $20 a month to install a “Facebook Research App” that harvested all data passing through their phones.

Apple blocked the app once the report was out, and it also revoked the Enterprise Certificate that let Facebook distribute the app without going through the App Store.

“Facebook’s position is that when you don’t pay for the product, you are the product,” said Ray Wang, principal analyst at Constellation Research.

As we move into an increasingly digitized world, inherent personal data should be classified as property, he told the E-Commerce Times. That would see property rights laws applied to protect users, as in this Oregon bill.

In light of the mass movement away from many social platforms, Wang recommended that Facebook “move from its one-trick pony of monetizing personal data in ad networks, and build off the monthly active user base to areas such as payments, commerce, and media and entertainment.”