Zuckerberg needs to face Facebook's problems

Can he really be so unaware that Facebook might be going down? There’s certainly no direct PR move that seems to be capable of rescuing it from such deep and troubled waters at this stage.

Zuckerberg is acting like Joel Goodson, the Tom Cruise character from the 1983 movie Risky Business. The blurb for the film says it all: “A Chicago teenager is looking for fun at home while his parents are away, but the situation quickly gets out of hand.”

Facebook has got out of hand, but it’s not as if the fall hasn’t been on the cards for some time. Social media visionary Oliver Luckett predicted it some time ago, way before company’s current woes.

Luckett, who co-wrote The Social Organism with Michael J. Casey in 2016 and co-founded theAudience with Facebook’s founding president Sean Parker, says: “I’m not at all a fan of Facebook. I regard the way it manipulates and controls our access to information as dangerous to the health of the social organism.

“Facebook’s Mark Zuckerberg has a great responsibility to encourage an open framework for social media that’s inclusive, transparent, constructive, and positively reinforcing.”

Luckett strongly believes Facebook’s model of controlling the social media landscape is rapidly coming to an end. He says that for all its claims to be the new way, Facebook mimics the same centralised structure of traditional media.

And he believes that centralised social media platforms will eventually die out. “Not yet,” he says, “but with so much systemic and technological change chipping away at the incumbents’ models, from the exodus of young customers to ad blocking, it’s not inconceivable that a tipping point can be reached that pushes centralised platforms into extinction.”

The smart money is on using the underlying technology, the blockchain. It offers the possibility of a revolutionary way to share value across the internet through a Decentralised Autonomous Organisation (DNO).

Within the DNO structure, there’s no place for any centralised puppet master controlling people’s data and continuously selling it to the highest bidder. The value comes from individuals having control over their materials and data and receiving micro-payments for their content.

In other words, with a DNO, the echo chamber we hear so much about on Facebook falls silent.

Meanwhile, Zuckerberg has been playing a kind of regulatory Pac-Man as European lawmakers start to impose serious fines for data breaches and The US Federal Trade Commission (FTC) investigate Facebook’s privacy practices.

Zuckerberg has agreed to testify before the US Congress but, in his arrogance, is refusing to appear before the British Select Committee – a move that will make him more enemies than friends.

Facebook’s killer crunch came on March 16 with the Cambridge Analytica data harvesting scandal that has wiped around $80bn off the company’s value, but Facebook first hit its iceberg when European regulators got tough last year.

Rather than repair the damage, Zuckerberg announced how Facebook’s AI-driven mass data breaches would allow upmarket shop assistants to use facial recognition technology to sell you things you don’t really need.

This was someone out of touch with reality. At one time, he could duck and dive around the rules because no one really understood what the hell he was up to, but now the regulators have caught up.

The revelations around Cambridge Analytica and its parent company, SCL Elections which boasts of ‘handling’ 100 election campaigns in more than 30 countries across five continents - principally by manipulating Facebook data – are shocking, and we’re not going to tolerate such data manipulation any longer.

Brexit and the US presidential elections are also implicated but Facebook is still a closed book asking us to its their word for it while democracy can be compromised by a kid with an internet connection.

Facebook’s biggest business strategy issue has been that advertising eyeballs don’t convert into that much cash. The company’s only real monetary value lies in selling data, and that lies outside the regulations of most countries, as Mashable reported in December last year.

They summed it up like this: “Facebook has grown into a global megapower by offering its services for free so that it can collect user data, which is then used for hyper-targeted advertising. The social network tracks users just about anywhere on the internet thanks to its near-ubiquitous Like button. That data dominance has helped Facebook make billions upon billions of dollars.”

Facebook have now been forced to announce it is stopping third party data targeting, but this smacks of too little, too late. Zuckerberg’s earlier grovelling quasi-apology taken out in the UK’s largest newspapers refused to rule out daily data breaching.

All it said was: “We’ve already stopped apps like this from getting so much information. Now we’re limiting the data apps get when you sign in using Facebook.” Limiting by what measurement?

Zuckerberg added: “Thank you for believing in this community. I promise to do better for you.” Hollow words.

Facebook’s simplistic PR 101 approach to handling a crisis simply doesn’t hack it. Apologise fully and take responsibility.

A smart Zuckerberg would hold his hands up and surrender his business to the closest scrutiny, but even that’s unlikely to offer much of a life belt.

If the FTC decides to fine Facebook for its 50 million data breaches, the estimated $2trn penalty alone will wipe them out. Before we know it, #deletefacebook could be dead in the water.

Whatever the financial outcome, the bottom line is simple. Facebook has been selling dreams, and we’ve woken up from a nightmare.

Bang On to Richard on email richard.hillgrove@6hillgrove.com and Twitter @6hillgrove