Report: Facebook leveraged user data for financial gain

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NBC expose on Facebook and privacy

For years now, Facebook has faced increasing scrutiny for its disregard of user privacy and unsavory data handling practices. Throughout it all, the company has maintained that it has not acted improperly. However, a bombshell new report from NBC News suggests the social network is every bit as reckless and malevolent as its critics often allege.

The news organization received 4,000 pages of leaked internal documents that paint a disturbing picture of the corporation’s culture. Various emails, meeting summaries, and web chats portray Facebook CEO Mark Zuckerberg as a Machiavellian figure akin to “Game of Thrones’” schemer Petyr Baelish. In contrast with his public statements regarding the sanctity of user privacy, behind closed doors, he leverages personal user data to improve his company’s position.

Furthermore, the NBC report argues Zuckerberg restricted access to the firm’s wealth of consumer information to crush emerging rivals.

What Facebook Really Does with User Data

Six4Three, creators of the Bikini-centric social app Pikinis, sued Facebook for denying it access to user data. In the resultant trial, the Silicon Valley giant was forced to furnish thousands of internal documents from 2011 to 2015. Subsequently, NBC News was supplied with some of those documents.

The files show Zuckerberg considered charging app makers for access to its platform shortly after its 2012 initial public offering.

The billionaire executive reasoned that third-party developers were benefiting from access to Facebook’s robust user analytics, but the company itself was not. Zuckerberg’s proposal was supported by the corporation’s board of directors and executives like chief operating officer Sheryl Sandberg. However, the firm ultimately decided to go another way.

Instead of charging a fixed fee for access to consumer information, the company allegedly demanded third-party developers share the user data they collect. Facebook also began pushing its corporate partners to increase their advertising spending to maintain access to the platform. Under its new paradigm, the social network made data-sharing deals with companies like Amazon, Microsoft, Netflix, and Tinder.

Facebook also reportedly began denying data access to companies that didn’t want to play ball. Developers that didn’t agree to share data or displeased the organization in other ways were cut off. Six4Three’s lawsuit argues Facebook’s decision to restrict its access to user info killed Pikinis.

Similarly, the corporation took steps to limit the growth of competing services by neutering their analytics access. Justin Osofsky, a Facebook vice president, instructed the firm’s engineers to withhold that access to an application called MessageMe because the corporation viewed it as a competitor. Osofsky told his team to do the same thing to any other messaging apps with similar growth rates.

Digital Game of Thrones

The NBC News report notes that members of Zuckerberg’s inner circle objected to third-party data-sharing on grounds that it represented a cybersecurity risk.

Sam Lessin, formerly a Facebook vice president, emailed Zuckerberg about the possibility that sharing user information with outside companies could result in a serious data breach. The CEO replied that such misuse of the company’s data was unlikely. However, Michael Vernal, the company’s ex-director of operations, found a malfunctioning third-party app once almost leaked Zuckerberg’s private messages.

During the 2016 U.S. presidential election, political consulting firm Cambridge Analytica exploited Facebook’s application programming interface to harvest user data on 87 million Americans. Consequently, the network was sued by the Federal Trade Commission (FTC) for not better safeguarding the public’s data.

The social network’s employees also raised concerns about the firm’s business practices. In 2015, Facebook product designer Connie Yang discovered some third-party apps could access and collect data users specifically marked private. Yang jokingly commented the privacy violation made her feel like she was working for House Lannister.

The documents NBC News obtained indicate user autonomy was not a major concern of the company’s leadership. In fact, when Facebook’s executives mentioned privacy at all, it was in reference to public relations.

The company allegedly decided to frame its 2015 move denying access to 40,000 apps as a measure to protect user privacy. In reality, the organization organized a digital Red Wedding to consolidate power and neutralize rivals.

Chaos is a Ladder

Industry watchers believe Zuckerberg’s plans to make the platform more private and calls for regulation are also a smokescreen. New School professor David Carroll told NBC the executive is trying to make his company look more responsible than it actually is as it negotiates with the FTC. “When the penalty hits they can be like, ‘Yeah, we agree, we deserve this fine,’” said Carroll. “It positions them to be conciliatory.”

Indeed, the documents NBC News acquired position Facebook as a staggeringly unethical enterprise. Predictably, the corporation disputes that perception. It told the media organization the documents offered a cherry-picked, one-sided view of its operations. However, the firm did not challenge the validity of the internal documents or provide evidence supporting its argument.

Thus far, Facebook has succeeded in the face of relentless controversy because of its consistent and robust profitability. However, given the incredibly damaging nature of the NBC report, the government might finally take action to prosecute the social media company for what appear to be clear antitrust violations.

If that happens, Mark Zuckerberg might learn what happens to master manipulators when their plans are finally exposed.