Facebook’s ‘FTC’ Probe Rocked The Stock But Will Anything Rein in Facebook?
It’s officially open season on Facebook.
“Facebook’s ‘FTC’ Probe Rocked The Stock But Will Anything Rein in Facebook”?: Angry users and losers investors. Regulators in the USA and Europe. State prosecutors and lawmakers – all say the social media giant should be held liable for the misuse of personal information from 50 million Facebook users by data analytics firm Cambridge Analytica, who said it helped Donald Trump to be elected.
The chances of a comprehensive regulatory response – the kind that Facebook has managed to overcome in the past – have never been so high. Even greater is the risk for Facebook in the court of public opinion.
“If I were Facebook, I would be very nervous about popular sentiment,” said University of Washington law professor Ryan Calo.
Facebook’s actions suffered on Monday after the Federal Trade Commission said it was investigating and prosecutors in 37 US states and territories sought details on how Facebook monitored what app developers were doing with user data and if Facebook had enough safeguards to prevent that from happening. misused. On the Capitol, lawmakers increased Facebook CEO Mark Zuckerberg’s request volume to testify.
The CEOs of some major technology companies that tried to become more responsible with regard to customer data processing also piled up.
“Smoking, drinking too much and spending a lot of time on social media: none of this is good for you,” Salesforce CEO Marc Benioff wrote on Twitter.
“I think this situation is so terrible, and it has become so big, that probably some elaborate regulation is needed,” said Apple CEO Tim Cook.
Image source – Getty
For years, Facebook skated with few consequences when it irritated users about how they handle their data. Regulatory and congressional agencies have largely resisted calls to crack down on Silicon Valley, which now has more than 2 billion users around the world.
But it faces an unprecedented reaction after reports in The New York Times and The Observer that political advertising consultancy Cambridge Analytica has unduly received data on tens of millions of Facebook users who downloaded an unrelated psychology application and data on those friends’ users without their consent.
“Facebook’s ‘FTC’ Probe Rocked The Stock”: Some brands, such as Pep Boys and Sonos, have taken their ads off Facebook. Elon Musk, CEO of Tesla and SpaceX, said it would exclude Facebook pages from their companies. Stocks (FB), which fell 6 percent after the FTC probe was announced but then rebounded to closure, are flirting with bear market territory.
Last week, in the wake of Zuckerberg’s apology for data abuse, Facebook’s chief operating officer Sheryl Sandberg said the Silicon Valley Company would be “open to regulation,” but did not specify what kind or amount.
FTC $ 40,000 Per Day Saff
“Facebook’s ‘FTC’”?: Facebook and regulators have faced it before, and that’s the subject of the FTC‘s investigation. The agency said it is investigating whether Facebook violated a 2011 consent decree to protect users’ privacy. The pronouncement requires Facebook to advise clients and get express authorization before sharing their own data past the breaking points of their security settings. Every infringement of the agreement would cost Facebook up to $ 40,000 every day.
“There are some fairly strong commitments embedded in the agreement,” said William Kovacic, a law professor at George Washington University and a former “FTC” member who chaired from March 2008 to March 2009. “The critical issue is to examine details about what happened here, Facebook obeyed. ”
The ‘FTC’ could also consider whether Facebook acted deceptively in the situation, which could lead to external monitors and regular data security compliance checks, says Stephen Calkins, a law professor at Wayne State University who served as the FTC‘s general counsel. 1995 to 1997.
As Facebook executives have already apologized for irregularities, “they almost certainly violated something imposed by the FTC and it is almost certain that there will be a tax remedy,” Calkins said.
Also complicating the problem: the FTC is operating with only two out of five commissioners.
“Facebook’s Will Anything Rein in Facebook”?: The biggest regulatory threat arises from the outside. Tighter privacy rules take effect in May and give users more control over what information Internet companies collect on them. But European officials, who have been far more aggressive than their US counterparts in seeking US technology companies for privacy incursions, are also seeking Facebook.
According to the political website, EU justice commissioner Věra Jourová demanded on Monday that Facebook respond to questions including the impact of data leakage on Europeans and whether misuse of data could occur again today.
“It is clear that your network has great influence and offers great potential for people, advertisers and other businesses. But with great power comes a great responsibility,” Jourová wrote in a letter.
Germany’s Justice Minister said on Monday she wants more company oversight than Facebook after meeting with her executives. A week ago, a UK parliamentary media advisory group assembled Zuckerberg to witness how Facebook utilizes the information. The UK Information Commissioner is exploring how Cambridge Analytica got the information.
“Facebook should be nervous about Europe,” said Calo of the University of Washington. “Europe has the regulatory hooks it needs and also the will.”
Congress may stop writing legislation this time as well, but it’s raising the pressure in other ways, with Republicans joining calls for tech giants to answer questions about data handling.
On Monday Senator Chuck Grassley requested that Zuckerberg testify on April 10 to the Senate Judiciary Committee hearing on consumer data privacy – the third committee, along with the Senate and House trade committees, to demand that the CEO of Facebook appeared.
Another lawmaker, Senator Richard Blumenthal (D-Conn.), Has asked the FTC to investigate whether Facebook should pay damages to users. “The sphere of analysis should be broader than just the consent decree,” he said in a statement. “There’s no excuse for delays.”
By far the biggest danger to Facebook’s social media empire would be to lose what really matters: the trust and time of its users. The Cambridge Analytica crisis seems to be harming the way people feel about Facebook.
“Facebook’s ‘FTC’ Probe Rocked The Stock But Will Anything Rein in Facebook”?: Only one in four (41%) of Americans rely on Facebook to obey the laws protecting their personal information, according to a Reuters Ipsos poll released on Sunday. In comparison, Amazon is trusted by 66%, Google (62%), Microsoft 60%) and Yahoo (40%), who reported a couple of massive violations in 2016.