On Saturday, the Washington Post published an opinion piece called The Internet Needs New Rules. Let's start in these four areas. The astonishing surprise, given the subject, was the author of the piece, Facebook & # 39; s CEO Mark Zuckerberg.
When the CEO of one of & # 39; the world's top five technology companies makes his voice heard what seems to be a contradictory opinion about his sector, investors should pay attention. And if that CEO openly calls for the government to arrange and control the company he founded, it's worth every effort to understand what the full agenda could actually be.
Facebook (NASDAQ :), along with its share that fell 43.5% from July 2018 to the end of December, has been plagued by countless scandals in recent years. During the 2016 US elections, it was accused of allowing Russian bots to spam the platform with propaganda and fake news
At the beginning of March 2018, the Cambridge Analytica scandal broke after it arrived that the consulting firm had been allowed to harvest the data of millions of Facebook users for political purposes. And just last month, when it seemed that Facebook shares, which reached 28.6% in early 2019, would finally recover, the mosque shooter in New Zealand used the social media platform to stream his gruesome activities live.
Timing Plus Topic Drop Facebook for Regulatory Curve
It is no coincidence that the timing of the weekend piece coincides with current calls from Democrats to break and regulate Big Tech. For more than one reason.
First, opinion is a peace offer aimed at regulators and citizens who have been plagued for years by the actions of Facebook. Secondly, by showing that it agrees with the need for regulation, Facebook puts itself ahead of itself and sets itself up to take advantage of the upcoming rules, while ensuring that competitors are hurt the most. Here's how.
In the play, Zuckerberg argues for regulatory updates in four areas: harmful content, election integrity, privacy, and data transfer.
1. Malicious content. At present, what this actually means is poorly defined. What offends one person may not be of interest to another. Some believe that unless speech provokes violence, it must be tolerated. As such, this is generally not a question of government, but rather social norms. And neither Facebook nor regulators have the resources to create a universal & # 39; just & # 39; formulate policy. Zuckerberg says he wants the government to order companies to build systems to & # 39; check content & # 39 ;.
Of course Facebook happens to already have these systems. In mid-2017, the company hired more than 3,000 reviewers to moderate hate speech with Facebook having to pay millions of extra salaries. Imposing a comparable standard on competitors, both established and emerging, will hamper profit for the larger players and completely exclude the smaller ones.
2. Election Integrity . As social media platforms become more central to the information gathering of people, this has grown in importance. It is also another example of Zuckerberg calling for regulation in an area where Facebook is already pretty well set up. The social media platform is already announcing who its advertisers are and checking their content. The call is simply an attempt to impose additional measures – and additional costs – on competitors.
3. Privacy Regulation. The idea that this comes from Facebook is almost laughable, considering how user data was processed in the past. Zuckerberg is now calling for additional controls comparable to the European General Data Protection Regulation (GDPR) that allow users to indicate how their data can be processed. "It would be good for the internet if more countries were to adopt regulations such as GDPR," said Zuckerberg, but in the first place it would be good for Facebook, because GDPR compliance is costly to implement and Google (NASDAQ 🙂 and Facebook Already has helped their ad-tech leadership positions in Europe. Although the GDPR implementation reduced the reach of Facebook by around 7%, the 50 best adtech companies lost an average of 20% of their reach after the implementation.
4. Data transfer. This is the ability to migrate data from one service to another. If this happens, service providers are forced to share data with each other when requested by a user. In this case, Zuckerberg is trying openly to continue with the standard data transfer format supported by Facebook, which will force others to adapt to it, instead of forcing Facebook to adapt to another standard. In addition, Facebook's huge reach and dominance in advertising of interests is only getting stronger with more data coming from different sources coming in, with its strong revenue-generating capabilities.
To be honest, everything that is mentioned in his opinion indeed has the potential to improve the social media experience and its impact on society, but it certainly doesn't hurt Facebook & # 39; s company that it New rules would enable the company to crush some competitors, strengthen the already dominant position and support their own social media power. Indeed, Zuckerberg already revealed his agenda to Congress in April when he said: "Regulation by definition ensures that rules that a company that is larger, that has resources such as ours, can easily comply, but that can be more difficult for a smaller startup. "
