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The cover of the March issue of Wired magazine says it all: A composite photo shows Facebook founder and chief executive Mark Zuckerberg bloodied, bruised and sweating, with a bandage over one eye.

There is no denying it's been humbling few days for the world's largest social-media company.

It started with revelations that Cambridge Analytica, a data firm with ties to U.S. President Donald Trump's 2016 campaign, had tapped into the profiles of more than 50 million Facebook users without their permission.

Facebook's stock has since lost nearly 13 per cent of its value, and the company is facing the spectre of tough new regulation of how it handles user data.

Also this week, European officials unveiled plans for a 3-per-cent tax on the local revenues of Facebook, Google and other big digital companies – part of what could become a global trend to tax the digital economy. Ottawa is similarly musing about a possible new tax regime for the digital world.

"We are looking at it carefully because we need to understand what, if anything, happens to our tax base, based on a changing of the economy towards a different business model," Finance Minister Bill Morneau told Bloomberg.

And then there is the continuing furor over Russia's use of Facebook to spread falsehoods and stir up social divisions during the 2016 U.S. election.

This should all be disastrous news for Facebook. Steep taxes and strict privacy rules could seriously crimp the way it does business.

But if that's where the world is headed, investors either aren't buying it, or they are oblivious to the risks. A 13-per-cent stock plunge is a blip for a company whose value is based almost entirely on data.

Above all else, Facebook is a data company. The social-media platform is free for users, who number 2.1 billion around the world. What makes it a viable business is the fact that advertisers are willing to pay Facebook handsomely to reach users, and harvest their information.

If Facebook, which also owns Instagram and WhatsApp, can't freely and profitably monetize user data, the company would be in deep trouble.

That apparently isn't the scenario investors envision when they look at the fallout from the recent data scandal, and the potential regulatory backlash.

Even after this week's stock plunge, Facebook remains one of the most valuable companies in the world, with a market capitalization of about US$465-billion.

And that's in spite of the fact that 84 per cent of that value hinges on something so elusive that it doesn't even appear in the company's books.

The company listed net assets (after liabilities) of roughly US$75-billion at the end of 2017. The remaining stock market value – about US$394-billion – depends almost entirely on the vast amounts of data it collects, and the riches investors expect the company to gain from that information.

When people create a Facebook account, they typically offer up a trove of information. A user's public profile might include their name, picture, cover photo, gender, e-mail address and their network of "friends." It could also indicate where they live, their birthday, any religious or political ties, along with work and education histories and even sexual orientation.

Facebook tracks whatever you do on the platform – photos, videos, comments, maps of where you've travelled, and all your "likes."

Advertisers can target users, based on all that information. Log on to other sites with a Facebook password, and users may be unwittingly sharing their profile with a much wider circle of data miners.

Eager to restore confidence and to get out ahead of any possible regulation, Facebook is now promising stricter limits on what app developers can do with user data. And it says it will audit what thousands of app developers may have done with user information.

Mr. Zuckerberg even says the company is open to greater regulation.

"I think there are things like ads transparency regulation that I would love to see," he told CNN this week. "If you look at how much regulation there is around advertising on TV and print, it's just not clear why there should be less on the internet. We should have the same level of transparency required."

But transparency alone won't stop Facebook and its network of advertisers and app developers from continuing to make gobs of money off people's life stories.

And that, apparently, is what investors are betting on.

Perhaps it has not been such a bad week for Facebook, after all.

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