RIP Facebook

In case you don’t follow me on Twitter, I bought Facebook stock during the dip following the news breaking about Cambridge Analytica. I sent out a Tweet asking if that was a dumb decision or if people thought Facebook would get back on its feet.  Technically the verdict is still out, but confidence is waning among investors as stock continues to drop day after day.

Facebook, the social media giant has been a behemoth of an organization for the past decade.  Anyone who has spoken out against their future has been proven wrong time and time again.  Competitors MySpace, SnapChat, and Google+  are either dead, dying, or never were alive.  Even The Social Network, a film that attempts to trash Mark Zuckerberg both makes the man look like a genius and serves as free advertising for the platform.  It is difficult to take down a monopoly.  Don’t believe me? You should Bing it. If that sentence doesn’t make sense, that’s because normal people would use the term “Google.”

If you actually use Bing, you can go ahead and leave.

However, Facebook is approaching a fate similar to what Hollywood faced in the past year. Cambridge Analytica seems to be the straw that will break the camel’s back.  Manipulating emotions wasn’t scary enough (and was probably overstated). The Russian attempt to skew the elections was just a bit too abstract. These two examples were probably not big news because of people’s idea that the scandals would not really affect them. People don’t usually think they are easily duped just as most assume they are a above-average drivers.

Unlike the previous scandals, the Cambridge Analytica case is huge!  If you want info on the scandal, this article gives a great straightforward explanation.  The writer says the scandal has sparked a “debate over how much users can trust Facebook with their data.”  That statement comes from the fact that this ‘new’ threat (only new in that people are now aware of it) is not a threat of being tricked but a threat of losing personal property.

I had a corny metaphor about how personal data is like a swimming pool and how we let certain people come swim in it, but it was a bit oversimplified. Instead, I would encourage you to read a great discussion of this issue written by @roarkword.  However, the question remains: Can we trust Facebook?  Certainly, the market shows they trust Facebook less.  The #DeleteFacebook movement has shown that as well.

 

data_pool

I’m not even going to claim that what Facebook did was okay.  However, I don’t think there were any ill intentions. They asked us to “click ‘Agree’ ” for apps to have access to our data.  Because we gave explicit permission (despite the fact that people may or may not pay attention to what they are clicking), Facebook initially thought it was fine for apps to have a lot more data on us.  After all, we okayed it!  Furthermore, it would seem that more data is better: the apps’ models (think Spotify recommendations) could become more effective – and increase our customer satisfaction – if they knew more about us.  Facebook has since learned that despite the potential benefits, the risk is not worth it.

Regardless of whether you are on the #DeleteFacebook bandwagon, we all actually need Facebook to succeed. Facebook faces big policy issues regarding data assets.  If they are able to succeed in finding a solution, they will likely be the ones to set industry standard.  If they don’t, who else could possibly set the standard? What other website has such enormous amounts of data tracked for individuals? Google. Perhaps there could be collaboration between these two giants to discuss what policies need to be put in place to protect users.  It seems too idealistic to think the government can make laws and regulations to perfect this situation.

google-dalles

So much data

What do you think? What is the future of user data security?

5 comments

  1. I think that this tweet speaks to the actual scale of Facebook’s data troubles: https://twitter.com/CBinsights/status/978711691381870599

    Although it is definitely a bad situation, I think the response to it has been much stronger to Facebook’s situation because it is so frequently used. In the tweet, you will see that the Equifax data breach was larger and Equifax arguably has much more serious information (i.e. social security numbers). I think this speaks to the reaction to Facebook being, as hot of a take as this may be, an overreaction. In my opinion, this is a good time to buy into Facebook. As much as some people would like to think they will delete Facebook (and some have/will), the network effects are so strong and so many people feel they have a personal connection to and investment in Facebook that I think that over time this issue will slowly go away. I think people will get more closure if Zuckerberg testifies in front of Congress and answers the questions well. Regardless, Facebook is too important and valuable to collapse from this event.
    I also like your point about Google and Facebook working together. Two of the largest data collectors out there would be a very reasonable collaboration. Maybe they have some type of conference among the best minds in data collection? Again, I am not an expert on this. But I do think that Facebook needs to get proactive about this issue. Although I think they will bounce back, I think the more proactive they are the faster they will bounce back and the less their market cap will take a hit.

  2. I think a collaboration between FB and Google would raise even more flags of a conspiracy to control us. I also think the jury is still out on how well Cambridge Analytica’s algorithms worked. I think a bigger problem is that foreign powers are exploiting the distributed information environment in the US to sow disinformation. Not sure that this is a problem exclusive to FB, but you could argue that maybe smaller, disconnected sites are inherently safer than large, default sites like FB.

  3. I find that Facebook is too big of a giant to leave. Personally I liked your Equifax breach analogy. People outside of the Finance department don’t really realize how big of a deal (and overused joke now) this breach was. Facebook is just so close to home and once the media starts publicizing that Facebook was breached in a serious way that affects “YOU”, people start losing it.

    However Bobby, I’m with you. Facebook is not in THAT hot water and still will survive and thrive in a big way. Buy in for that stock, Facebook Apps hardly add any value anyways to Facebook. Personally I use the platform to consume content, not to play Farmville anymore. I don’t see “login with Facebook” being the Be All, End All single log in source anyways. It’s too close to home with conversations and friendships. I believe that a more anonymous platform may grow to become the “log in with [insert name here]”. I think Google may take the opportunity in my opinion but Facebook will continue to exist and drive value through friends sharing photos, posts, and comments.

  4. Unless another comparable application comes out that speaks to the audience then it will be hard. Other competitors would be best to try to live in the ecosystem vs overtake them. I am less sensitive to the security aspect, as even the government has trouble protecting ours. Life lock and other services should become more popular.

  5. Very much agree with the point you made that people have okeyed the terms and conditions when sign up for Facebook. Neither am I to think that what Facebook did was fine. But there is no bad intention with Facebook, and I think the data trouble is going to happen sooner or later. And it’s just too bad for Facebook that they are the one raised the issues for everyone. I personally think that Facebook did everyone’s a favor by showing the danger of data before, or maybe it’s already severe enough. I do hope that the market will be more confident with Facebook.

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