Wrangling With the Facebook Problem

With Mark Zuckerberg set to testify today on Capitol Hill, and revelations last week that the Cambridge Analytica data breach is now estimated to have affected nearly 90-million users (up from around 50 million), there seems to be no shortage of theories as to how to solve the “Facebook problem.” Congress will ask Zuckerberg what Facebook’s leadership knew about the abuse of its data, when they knew it, and what the company plans to do going forward to protect consumers. Regulatory solutions have their limits, of course, and may even exacerbate a problem if legislators fail to properly grasp the underlying issues. Still, the conversation is long overdue on themes like how much data is being gathered, by which corporations, and for what purposes.

For the past few weeks, Zuckerberg has been contrite, even self-flagellating, which is admittedly a refreshing change from the standard arrogance of Silicon Valley executives. But that’s mostly theater. At best, Congress can do what Congress does, which is to tell Facebook to clean up its act, or they’ll clean it up for them. Meanwhile, there seems to be general consensus among experienced technologists and tech writers that there are limits to how much Facebook can be repaired. “We cannot have regulators trim a beast as if they were barbers and call that change,” writes Jaron Lanier in an editorial advocating the wisdom of those willing to delete Facebook from their lives.

Many responses and proposals to the Facebook fallout have been variations on the theme that the internet (as if it were a conscious being) must to return to some idealized, pre-commercial set of values people seem to believe were present 20+ years ago. One might even say that these voices insisting we “make the internet great again” are guilty of a related, ahistorical folly that cannot sensibly answer what again quite means in that sentiment. For instance, a recent article by Tim Wu for The New York Times manages to criticize Facebook while alluding to a familiar refrain of cybernetic idealism at the same time. He writes …

“From the day it first sought revenue, Facebook prioritized growth over any other possible goal, maximizing the harvest of data and human attention. Its promises to investors have demanded an ever-improving ability to spy on and manipulate large populations of people. Facebook, at its core, is a surveillance machine, and to expect that to change is misplaced optimism.”

It’s not that I disagree with that description—it’s irrefutable—so much as it is perplexing to imagine that anyone ever believed there might have been another “possible goal” Facebook was going to pursue. While Zuckerberg was still in middle school, I was in meetings where major ad execs were counting on exactly the kind of consumer-specific targeting that was finally made possible when Google and Facebook figured out how to get us to share gigabytes worth of personal information without minding. The “surveillance machine” was the golden goose investors were banking on from the moment the internet became publicly accessible.

Wu’s answer to the problem is good old-fashioned competition. Asserting that the web’s tendency to foster monopolies is not a matter fate, he states …

“…the real challenge is gaining a critical mass of users. Facebook, with its 2.2 billion users, will not disappear, and it has a track record of buying or diminishing its rivals (see Instagram and Foursquare). But as Lyft is proving by stealing market share from Uber, and as Snapchat proved by taking younger audiences from Facebook, ‘network effects’ are not destiny.”

While I think Wu is right to say that a competitor could theoretically do Facebook better (e.g. be better stewards of our data), I remain skeptical that “network effects” are not inevitable when it comes to certain types of platforms. Because if New Facebook came along offering the same features, plus new consumer-protection benefits, we’re all—I mean all of us—migrating to the new platform, leaving Old Facebook to go drink with MySpace.

Of course, with 2.2 billion users and a market cap of nearly $460 billion, the company in the best position to become New Facebook is Facebook. Regardless, most of us only need one time-sucking, data-gathering, cyber-water-cooler in our lives—if we really need any at all—so I still believe certain internet monopolies are inevitable.

If mitigating data abuse by means of competition is what Wu is truly advocating, his references to Lyft and Snapchat seem to sidestep some very tough questions. For instance, a ride-hailing app/service is not remotely comparable to a social media platform. Lyft and Uber are transaction facilitators, and the consumer only benefits by having multiple players compete to provide one service—a ride—on an as-needed basis. That model is simply not analogous to the reasons users spend time and effort contributing all of the content on a social platform.

As for Snapchat, it’s true that my teenager tells me she and her friends are there because “Facebook is for old people,” but at 150 million users, the platform is hardly proof that Facebook’s network effect is not inevitable. Meanwhile, I personally think it’s anybody’s guess what this next generation of users is going to expect or want from social media as they become young adults. This includes growing bored with the whole enterprise and bailing.

Competition is a good thing, but Wu’s generalized appeal to market forces as a response to the “Facebook problem” echoes rhetorical allusions that have been made at various times in the context of copyright enforcement online. For instance in mid-2016, during hearings about the DMCA, critics of any proposal to introduce a “takedown/staydown” provision insisted that the cost of implementation would be so high that it would entrench, for instance, YouTube as the monopolistic social video platform.

This line of reasoning has always lacked integrity for completely ignoring the various market forces, including the network effect, that sustain YouTube’s dominance. I suspect Wu is making a similar error in this case, perhaps oversimplifying the challenge. As just one prosaic example, I am very much drawn to Lanier’s sentiment when he writes, “…those who have had accounts and then deleted them are true pioneers. They will see things and learn things that are new in the world.” Indeed. But if I’m being honest, I discovered his article because a friend shared it on Facebook.

© 2018, David Newhoff. All rights reserved.

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