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The company generated $ 56 billion in 2018, partly by tracking people on and off its platform and then selling targeted ads based on this monitoring. Yet when Facebook announced the move to a "privacy-focused communication platform" in March and that it unveiled a new private messaging design at the F8 developers conference on Tuesday , the market value of Facebook has not even dropped. How could this be, if surveillance is essential to Facebook's business model?
Maybe all this talk about privacy is nonsense, and investors know it.
Meanwhile, the Federal Trade Commission, the agency charged with protecting consumers and enforcing a 2011 privacy order against Facebook for violating user privacy, also seems to have nothing to do with it. Although negotiations for a settlement between the FTC and Facebook are confidential, the agency plans to impose a $ 3 to $ 5 billion fine on Facebook, an amount that Facebook could gain in only one month. The fine is a simple cost of doing business that justifies breaking the law for Facebook. One report says the FTC will not force Facebook to change its data handling practices and that it will simply ask Facebook to create a confidentiality monitoring committee to report to the FTC. But Facebook was already required to send the FTC's confidentiality reports as part of the 2011 order. None of these remedies adequately protects consumers in the light of persistent violations of Facebook's privacy. The FTC opened its investigation after the Cambridge Analytica scandal, but since then, numerous privacy breaches have been reported, affecting several million users. According to a new report, Facebook said it was open to increased surveillance and Zuckerberg called for increased regulation of the internet in the past.
Effective remedies must both curb data collection and promote competition, sparking new innovative business models from Facebook and others. Like many in Silicon Valley, Facebook has pioneered the wrong way by building a surveillance architecture that is dangerous for democracy.
Facebook's so-called pivot for privacy is anything but
With the transition to private messaging, Facebook may no longer be able to read the text of these encrypted messages, but the company has not yet announced its intention to stop tracking users on millions of sites Web or monitor their behaviors, their connections and their interactions. , places, interests or purchases – the way Facebook follows users without their knowledge is endless and is not limited to reading their messages.
Facebook has instead announced new methods of monitoring people, such as a new dating feature and integrating purchases into Instagram. The move to confidentiality would mean that Facebook collects less of our personal data, no more. And yet, these new business areas are also fueling Facebook's strategy of retaining users on its platform rather than a separate dating app or the brand's website, allowing Facebook to collect more data, to show more ads and earn more.
At about the same time Zuckerberg announced Facebook's so-called pivot on privacy, he also called for government regulation on "harmful content, electoral integrity, confidentiality, and data portability." ".
But the problem lies in the commercial model of targeted advertising based on the monitoring of Facebook. Breaches of privacy and elections are not inevitable – they are commercial decisions.
If Facebook stopped programming its algorithms to prioritize engagement, incendiary, hateful and polarizing content would not be magnified (fear and anger "engage" humans the most, according to research). Giving priority to engagement is a business choice because it allows users to stay on the Facebook platform to show them advertisements and collect their data.
If Facebook stopped collecting massive amounts of user data to fuel its targeted advertising business model, foreign agents could not interfere with elections by targeting and manipulating Facebook users precisely. Those seeking to influence elections use Facebook's monitoring architecture to identify the users most likely to receive their messages.
A business model away from targeted advertising might well be in the long-term financial interest of Facebook. But because innovation aimed at reducing monitoring goes against Facebook's profit motives, the FTC must impose solutions that force the company to innovate its business model.
How the FTC could protect consumers
Backed by the threat of $ 1 trillion sanctions in court, the FTC could ban Facebook from collecting certain types of data. This could force the company to give up its current practice of following consumers in a way that it would never expect from radical transparency. The FTC may require optional user consent for each purpose for which Facebook collects data, with users having the option of not being tracked.
The FTC could cancel mergers between WhatsApp and Instagram illegally under the Clayton Act, which prohibits mergers that could create a monopoly. Dividing companies in this way would minimize the scale of Facebook – and the damage done – and create competitors. Without serious competition, Facebook has been able to cause damage without fear of losing profits. Competition would give consumers and advertisers the opportunity to choose a social media platform with a less destructive business model.
The FTC could also ban Facebook from acquiring competing threats in the future, or even ban all acquisitions until Facebook repairs the damage it causes. Without such a ban, Facebook can simply acquire and kill innovative startups that could compete by offering greater privacy. At a minimum, the FTC should prevent Facebook from integrating WhatsApp, Instagram and Facebook Messenger into a common infrastructure, which would only reinforce its monopoly power.
The FTC could also impose true interoperability requirements allowing competitors to safely emerge and communicate with the Facebook network, much like a Verizon network phone can communicate with a phone from the AT & T network. Interoperability would remove the almost insurmountable competitive advantage of Facebook from being the place where all your friends already are. Zuckerberg's solution for data portability – being able to take your data with you – does not reduce this barrier to competition.
Spying on Facebook is a business choice, and the FTC allowing it is a political choice. It is high time to make better choices and innovate to improve democracy rather than unravel it.
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