Facebook: After Mark Zuckerberg’s Testimony, How Will Regulation Play Out?

by: The Knowledge Group

April 17, 2018


Facebook CEO Mark Zuckerberg has spoken to Congress. Key highlights give us an idea of the action Congress will take next.

Is Facebook dealing with actors and ads that attempt to influence elections?

Prompted by special counsel Robert Mueller’s team, Facebook will do so, and regrets its past slowness in identifying Russian influence through social media. Zuckerberg told Congress that Facebook will now make sure political advertisers in in U.S. elections have U.S. identities.

Facebook ads are targeted to certain people based on their online conduct and habits. Can’t Facebook stop this?

Zuckerberg reiterated Facebook COO Sheryl Sandberg’s comments to “The Today Show.” There will be no opting-out of these ads—unless Facebook charges a premium for such an option in the future.

Is Facebook Storing Your Personal Information?

Yes, Zuckerberg said—and Facebook stores “some of that content” with the user’s permission. Facebook is involved in facial recognition and other sensitive experiments. Zuckerberg cited Chinese competition as a rationale for being permitted to continue.

As Zuckerberg couldn’t clearly say whether Facebook can track account holders’ activity across various devices after they log off, it’s hard to imagine how regulations will deal with the possibility.

Is Facebook Selling Your Personal Information?

No. But it is enabling advertisers to target a demographic, said Zuckerberg—”then we do the placement….”

Yet a Cambridge University neuroscientist managed to obtain and sell Facebook data to several companies: Cambridge Analytica and others. Facebook itself doesn’t know the scope.

Could Facebook have banned Cambridge Analytica?

Yes, Zuckerberg haltingly admitted, after being reminded that the company was an advertiser. “We made a mistake,” the CEO said.

Why Was Cambridge Analytica Never Seriously Confronted?

When Facebook contacted Cambridge Analytica, CA reps told Facebook they’d deleted the data. Facebook, said Zuckerberg, then considered the case closed. But it gets still worse. Facebook never notified the Federal Trade Commission after discovering the breach in 2015. Nor did Facebook tell some 87 million users that their information was grabbed. We can expect future breaches to be regulated with disclosure rules.

Policy for a New Class of Businesses

Notably, stocks rose following Zuckerberg’s performance.

We see Congressional concern about tech firms wielding unchecked power. But will social media face laws with teeth to protect consumers? Facebook shows little interest in changing its business model, a model now known to have been hijacked by parties looking to manipulate a U.S. election.

It’s clear that law and policy must evolve to deal with a new class of businesses, writes Jack Balkin: the information fiduciary.  Stay updated with this and other business developments with our live and recorded events by clicking here.