Facebook is yet to learn from past errors. Tech Crunch recently reported that Facebook secretly paid teenagers $20 to install a “Facebook Research” VPN.
Once installed on a smartphone, Facebook reads your messages, watches your web activity and steals data from your mobile. The app is similar to Onavo Protect that was banned and removed from Apple Store in June and August 2018 respectively.
When it launched in 2016, Facebook Research used three companies to target young people aged 13-35. The name changed to Project Atlas in 2018, after outrage against Onavo. Facebook pulled the app because it violated data collection rules.
Facebook incentivized users with $20 a month in gift cards. They earned an extra $20 for referrals. In exchange, users left the app running on their phones and took screenshots of their Amazon order history. They could potentially have used the screenshots to improve targeted ads on Facebook.
To recruit participants, Facebook worked with Betabound, Applause and uTest via ads on Snapchat and Instagram. In some of the dubious ads, users aged 13-17 saw adverts for a paid social media research study.
Facebook knowingly avoided Apple’s official beta testing system, TestFlight. Here, participants are limited to 10,000 and the app must be reviewed by Apple. Instead, Facebook Research participants installed a VPN and an Enterprise Developer Certificate. They gave Facebook unlimited access to data transmitted on their phone.
It violates Apple’s rules where developers can only use this system to share internal corporate apps for their employees.
Facebook responded by saying the programme was misrepresented. A company spokeswoman explained it wasn’t spying. All participants were paid to participate and went through a transparent on-boarding process. Teenagers also provided parental consent forms before signing up for the research study.
Facebook also denied allegations that Facebook Research app is a direct replacement for Onavo. They argued that its market research practices were nothing unusual. The goal of the research is to help Facebook gain a better understanding of how people use their mobile. Sheryl Sandberg also stated that teenagers consented to put Facebook Spyware on their phones.
TechCrunch commissioned Will Strafach, a mobile firewall security expert to determine the data Facebook collected through the app. He found that Facebook collects private messages on social media apps, emails, media files sent between users, location information, web browsing activity and web searches.
This is proof that Facebook is willing to ignore regulations to protect its dominance. Tech Crunch suggested a more stringent action, such as revoking Facebook’s permission to offer employee-only apps. Their blatant disregard of IOS policies is another issue in a row of multiple data breaches and problems for the social media giants
Facebook has lost popularity with young millennials
In 2018, A Pew Survey of teenagers’ use of technology found that most kids had dumped Facebook for visually stimulating social media such as YouTube, Snapchat and Instagram. According to young millennials born between 1991-2001, Facebook has too much text. They also complained that their grandparents, parents and friends were there. This makes Facebook “untrendy” and “uncool”.
In 2017, e-Marketer reported that Facebook lost 9.9% of users aged 12-17 years. That’s almost 1.4 million users. The figure increased to 2.2 million in 2018.
Social media experts theorized that Facebook was too diverse for millennials who want to maintain privacy. Their following on Instagram and Snapchat is more closed. When someone likes or comment on a post on Instagram or YouTube, it’s not going to appear on a shared contact list, as is the case of Facebook.
In light of the recent data breach, Facebook could lose more teenagers in the following weeks. Kids who are already concerned with the lack of privacy could see this as motivation to make a complete switch to Snapchat or Instagram.
The Cambridge Analytical Scandal and #deletefacebook campaign
In 2018, when asked about what he would do if he were in Mark Zuckerberg’s shoes, Tim Cook refuted that he wouldn’t be in that position. Apple doesn’t monetize their customers because customers aren’t products.
The question originates from the Cambridge Analytica scandal. A British firm, Cambridge Analytica, illegally harvested information from millions of Facebook users over a 5-year period. Facebook didn’t do anything, although they had full knowledge of the breach in data use.
Public outcry on social media led to the #DeleteFacebook campaign. It was supported by Whatsapp co-founder Brian Acton. The hashtag trended shortly after the news broke. Other celebrities who quit Facebook include Will Ferrell, Cher, Rosie O’ Donnell, Elon Musk, Jim Carrey and Apple’s co-founder Steve Wozniak.
Documents obtained by a joint investigation of the New York Times, Observer of London and The Guardian revealed that Cambridge Analytica influenced voting outcomes with the illegally mined data.
A video released by Channel 4 News showed senior executives bragging about using fake news, bribes and sex workers to help political candidates win elections. The brave whistleblower, Christopher Wylie stated that Cambridge Analytica mined data from over 50 million Facebook accounts.
Facebook posts record profits in spite of privacy scandal
Despite social backlash and growing concerns with privacy, Facebook’s quarterly earning was unaffected by the scandal.
Facebook shares rose 8% on Wednesday’s extended session after a record fourth-quarter profit that surpassed Wall Street predictions. Net income was $2.38 ($6.88 billion) a share as against $1.44 ($4.27 billion) in 2017.
Facebook recorded a net income of $22 billion for 2018, an increased 39 cent year-on-year. Revenue for the same period totalled $56 billion. A 37% increase from 2017.
The strong numbers are a conundrum for experts, given the P.R nightmare Facebook has endured. Brian Nowak, a Morgan Stanley analyst noted that Facebook’s strong finish speaks to the strength of its ad offering, engagement and earning power.
It’s a haven for small businesses who have launched successful campaigns with a tiny $100 budget while spending $1 a day on advertising. The Ads Manager platform offers sophisticated analytical tools to help marketers track spending and effectively allocate resources. Marketers match their advert with a targeted audience most likely to convert. We expect Facebook to fare well as long as they keep their two billion users.