Unfriended: Facebook backlash points to troubling new narrative

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This time last year, Mark Zuckerberg took to Facebook to highlight how the platform was helping democracy by connecting political candidates to their constituents. “The more you engage with the political process, the more you can ensure it reflects your values,” he wrote in a post last March. Several analysts mused that the chief executive might be mulling a run for office himself.

Today, after stumbling through a series of political scandals about how Facebook’s technology and data have been manipulated to influence public opinion and undermine democracy, some are questioning how long Silicon Valley’s most famous CEO can survive.

Explainer: What is the science behind the Cambridge Analytica scandal?

Opinion: No, the Facebook backlash won’t let us go back to the elections of old

After five days of silence, Mr. Zuckerberg issued his first public statement last week on revelations that a personality quiz developed by a Russian-American academic had gathered data on tens of millions of Facebook users without their knowledge, then shared it with U.K.-based consulting firm Cambridge Analytica, which was hired by backers of Donald Trump’s election campaign to build psychological profiles of voters.

In media interviews, Mr. Zuckerberg hit all the right notes. He apologized for letting down Facebook’s users, admitted the company should have done more to ensure its data hadn’t fallen into the wrong hands and promised a sweeping audit and overhaul of the company’s data-sharing policies.

Yet as the company embarks on a process to fix Facebook, there are indications that a troubling new narrative is taking root.

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The firm’s sliding share price, a campaign to #DeleteFacebook, regulatory investigations and mounting pressure from global lawmakers for the social-media giant to be held accountable for its lapses in judgment are all signs that it may be too late to restore the public’s broken trust in Facebook.

What’s more, the furor over Cambridge Analytica’s data seems poised to erupt into a political crisis that engulfs much of Silicon Valley. On Friday, a team of 20 investigators from Britain’s data watchdog searched the firm’s London offices.

“This is definitely the most embarrassing moment in Facebook’s history so far,” said University of Virginia media professor Siva Vaidhyanathan, who has a book about Facebook due out in September.

In the United States, leaders of congressional committees are pressing for Mr. Zuckerberg or his chief operating officer, Sheryl Sandberg, to provide testimony. “Zuckerberg must come clean,” said Richard Blumenthal, a Democratic member of the Senate Judiciary Committee. “The buck stops with him.”

The Facebook founder also faces pressure to testify before British parliamentarians as well as lawmakers in the European Parliament and Germany.

Mr. Zuckerberg said he is “open” to appearing before Congress under the right circumstances, and it seems likely he will have to testify soon in order to quell lawmakers’ outrage. “My guess is that this issue will stay on the front burner for a while, at least until and shortly after he testifies in front of the U.S. Congress, in the U.K. and in Europe,” said Pivotal Research Group analyst Brian Wieser.

A more immediate problem for Facebook may be the growing #DeleteFacebook campaign that has been taken up by celebrities such as Jim Carrey and Cher, Tesla chief executive Elon Musk and the billionaire co-founder of WhatsApp, the messaging service Facebook bought in 2014.

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The world’s most valuable social network reported its users had collectively spent 5 per cent less time on the platform in the final quarter of last year, and analysts believe Facebook was already starting to lose users in the United States and Canada in 2017. “The biggest issue we see for Facebook is if the #DeleteFacebook [campaign] leads to user attrition and eventually ad dollars allocated elsewhere,” analysts from Barclays wrote last week. “We’ve seen internet companies where the negative narrative becomes reality and smart people start leaving the company.”

Mr. Wieser said the ongoing apologies point to “systemic problems” in Facebook’s ability to properly execute its business model. “There is at least a recognition that they made a mistake several years ago, but they seem to keep making mistakes,” he said. “They may need to make managerial changes, which has its own set of ramifications.”

Increasingly some wonder whether those management changes may involve Mr. Zuckerberg or Ms. Sandberg. “In a situation like this, if you had any other publicly held company with as much power as this and with this number of consecutive failures to execute, the CEO would have been fired,” said Michael Connor, executive director of Open Media and Information Companies Initiative, a non-profit that works with social-impact investors and is supporting accountability proposals by two institutional Facebook investors.

Mr. Zuckerberg expressed his deep unease with shouldering the responsibility for making tough ethical decisions. “I feel fundamentally uncomfortable sitting here in California at an office, making content policy decisions for people around the world,” he told technology news website Recode.

It would be a difficult, if not impossible, effort for disgruntled shareholders to force him to step down, given that he retains voting control over the company and its board of directors. But Mr. Connor points to Uber co-founder Travis Kalanick, who had similar control over the ride-sharing company – until he was pushed out as chief executive after a series of scandals involving the company culture.

For others, however, the Cambridge Analytica scandal is only a small slice of a problem that extends deep into Silicon Valley, whose business model is built on giving services away for free in exchange for personal data that can be sold to advertisers and other interested parties.

While Facebook was unique in its ability to collect a tremendous amount of information on its users’ social connections and in its previous willingness to openly share it with developers and advertisers, the company follows the industry playbook when it comes to sharing consumer data.

“The fact that they gave it away is not so surprising as the fact that they gave it away for free,” said Vibhanshu Abhishek, an assistant professor of information systems at Carnegie Mellon University who studies the intersection of technology and consumer behaviour.

Virtually all the major tech companies, including Google, Apple, Amazon, Uber and Twitter, collect similar data on their users as part of their core business. Advertisers and political consulting firms also turn to an array of data brokers, who sell data amassed by tracking consumers across the internet.

For many social-media experts, the biggest shock is that it took so long for public opinion of how companies share their data to shift from a collective shrug to global outrage. “The Cambridge Analytica meltdown has made visible issues that many of us have been complaining about since 2010,” Prof. Vaidhyanathan said. “But no one was willing to listen until there was a villain for this story.”

Engineering professor Ali Abbas stopped using his Facebook account about a month ago, when he noticed all the ways the platform seemed to be tracking his online behaviour without his permission. The social network was suddenly suggesting he become friends with someone whose contact information he had recently added to his iPhone. Ads began appearing on Facebook for purchases he’d made on Amazon. There were even listings for homes he had looked at on the real-estate service Zillow.

As the director of the University of California’s Neely Center for Ethical Leadership and Decision Making, Prof. Abbas saw the behaviour as akin to the social network conducting experiments on its users without their knowledge, an ethical breach of trust that will take Facebook a long time to repair - if it ever does.

“Facebook is facing an existential crisis about what they are about and what are the limits that they’re willing to take in order to get people’s information,” he said. “This is a turning point for people, but I think if Facebook were smart it should be a turning point for Facebook itself.”