[Update: CEO Mark Zuckerberg and COO Sheryl Sandberg finally speak out, and totally blow what should have been an apology.
Facebook has hit a new company high -- which means a low -- in an ongoing PR crisis. Yesterday afternoon, Brian Acton, co-founder of WhatsApp -- Facebook bought them for $19 billion -- suggested that people delete Facebook from their phones and computers, using the hashtag, #DeleteFacebook, because of privacy issues. Hardly what CEO Mark Zuckerberg would want to hear.
The criticism is harsh and not isolated. An investigation by the Federal Trade Commission over the company's data-sharing policies is reportedly in the works. Facebook's chief security officer effectively said that the company can't police users because it's too large -- not at all reassuring from a company that has this kind of access to massive amounts of personal data. And a former Facebook vp says the company is 'destroying how society works'.
This is a growing PR and branding disaster that makes anything Uber faces seem like public chastisement over littering in comparison.
Not to minimize Uber's trials. But the criticisms of that company have always been about how it runs the business. Facebook is under fire for what it is.
To put it differently, Uber has the unenviable task of changing the corporate structure and all its practices. The amount of work necessary is titanic, even as new CEO Dara Khosrowshahi fights to find a path to profitability. (Losing billions a year is an enormous problem in its own right.
Facebook is profitable and will likely to continue as such, given how many people worldwide are locked into the platform because of network effects. Even now I see professionals I know who want alternatives but face the reality that all their contacts won't be in a new system.
But the magnitude of alarm, particularly in the wake of the 2016 election, is existential in nature. As just one example, Timothy Summers, director of innovation, entrepreneurship, and engagement at the University of Maryland, had an article today titled Facebook is killing democracy with its personality profiling data. And this is from someone who also discloses that he owns shares in the company.
The problem, he argues, is that Facebook has gone far beyond the type of demographic profiling that is stock in trade for virtually any advertising. Advertisers haven't begun to leave the network. Getting data on people's personalities and ideologies, particularly through popular social media quizzes, is addictive to marketers. Particularly when the access also comes with troves of personal data. Here's how Summers describes it in the context of the "academic" research that was sold as an election marketing tool:
In 2015, Facebook gave permission to academic researcher Aleksandr Kogan to develop a quiz of his own. Like other quizzes, his was able to capture all of your public information, including name, profile picture, age, gender and birthday; everything you've ever posted on your timeline; your entire friends list; all of your photos and the photos you're tagged in; education history; hometown and current city; everything you've ever liked; and information about the device you're using including your web browser and preferred language.
Adding to what Summers said, here's how potent this information can be. Your picture and other data can let companies find you in many other contexts, tying them all together. Friends lists to into developing social graphs that further pinpoint who you are and what you do. Images increasingly can be analyzed, particularly when faces are shown. Everything you've ever liked becomes a history of your preferences.
The more people start to learn this, the increasingly upset they can get.
Facebook is quickly becoming radioactive for politicians. Conservative Republicans are sure the company has discriminated against them. Democrats on the left will find it hard to embrace the network when claims of helping to their opponent into the White House -- whether accurate or not -- have become a dominant public narrative in the press.
Even in the face of repeated past criticism over privacy (or lack of privacy) practices, Facebook has avoided increased regulation. However, the pressures it is starting to feel, and will continue to face, dwarf anything before. No amount of spending or lobbying can keep it out of trouble. When almost the entire political spectrum is set against you, avoiding punitive actions is like trying to stand your ground against incoming waves at the seaside.
Additionally, Facebook is bungling the crisis PR aspects right, left, center, up, and down. Neither Zuckerberg nor COO Sheryl Sandberg has made a public statement, as Bloomberg noted. This is not a case where the word of those lower down will make any difference.
In the meantime, Facebook shares have lost more value -- $60 billion -- than the entire market cap of Tesla or three times that of Snap. This is bad, and inept actions will only make it worse.