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Why 2018 was the worst for Mark Zuckerberg and what does this mean for the free Internet ?

The story of the confrontation between Facebook and the American public is not as local as it seems.

January 4, Mark Zuckerberg announced – his main goal in 2018 will be a large-scale work on the mistakes in Facebook. For the public and the media, this became an important sign, because if in the past Zuckerberg called personal tasks like reading 23 books a year or learning Mandarin as his personal goals, this time he promised to focus on solving the problems of his brainchild.

Toward the end of 2018, it is obvious – if Zuckerberg tried to rectify the situation, the public did not notice. Almost all of the last 12 months, Facebook has been under fire, getting into new and new scandals, and the media continued to publish evidence of the incompetence of top managers. All this led to the fact that the United States is seriously discussing the seemingly unthinkable: the departure of Zuckerberg as head and government intervention in the work of Facebook.

While it is impossible to say who is winning in this confrontation. The main battle will unfold in 2019, but one thing is for sure – this is a historical event in which the fate of the free Internet is decided.

Battlefield – scandals that brought Facebook into a deep reputational crisis

A complete list of claims against Zuckerberg’s brainchild to list for a long time – in 2018 there were more than 20 of them. I will mention the most important points, without knowing which one cannot understand why the American public has been on strike against the company for more than two years.

Facebook as the mouthpiece of “propaganda”

The start of the war against Facebook lies in the split after the victory of Donald Trump in the 2016 presidential election. The country vied with each other to discuss how it turned out that the presidency occupied the main outsider of the race, looking for the culprit. And found it on Facebook.

First, cyber specialists, and then the media noticed that hundreds of posts appeared on the social network during the presidential campaign calling for a vote for Trump. Further investigation revealed that these targeted posts are connected with the Russian “Internet Research Agency” Yevgeny Prigogine – close to the Kremlin.

Businessman Yevgeny Prigogine, whom the US authorities suspect of sponsoring a political campaign on Facebook in the interests of the Kremlin Photo by AP
Businessman Yevgeny Prigogine, whom the US authorities suspect of sponsoring a political campaign on Facebook in the interests of the Kremlin Photo by AP

They began to look at the social network as an unwilling shout of “Russian propaganda.” Facebook management was accused of having missed millions of political posts with obvious manipulations. In November 2016, Zuckerberg called this idea “madness”, but a year later the company recognized that more than 150 million users of Facebook and Instagram (owned by Facebook) saw posts supposedly financed by the Kremlin. It became clear that Facebook lied to people and called their doubts “insanity”, and admitted the mistake only under pressure from the public, the media and the US government.

Facebook and data leak 50 million people

At the beginning of 2018, the situation around Facebook subsided slightly. Zuckerberg promised “to fix everything”, and the authorities turned their attention to the Kremlin as the “main threat” to the country’s cyber security. Everything changed in March, when it became aware of a data leak of 50 million Facebook users to research firm Cambridge Analytica.

This organization creates “profiles” of potential voters with the help of a larger data file, and then selects targeted ads for them. Formally, there is nothing wrong with this activity. The problem was that in 2014, the company, bypassing Facebook’s rules, received personal data from 50 million US social network users for compiling “profiles”. In 2016, Cambridge Analytica began working with Trump’s campaign headquarters and used the accumulated data. Facebook knew about the leak, but remained silent until they were again pressed from outside.

Facebook removal campaign

Immediately after the story of Cambridge Analytica, Massachusetts Attorney General Mara Heley announced the launch of an investigation into Facebook, and the company ‘s shares fell by 6%. At the same time, the public joined the condemnation – with the filing of one of the founders of WhatsApp (bought by Facebook for 16 billion dollars), the hashtag #deletefacebook was sold on the Internet . Thousands of users, including famous personalities like Ilona Mask, supported the campaign.

The boycott hardly hit the number of users of the social network, but the task was not to take away the audience from Facebook, but to force the company to pay attention to the security holes of the social network. It was possible – five days after the scandal with Cambridge Analytica, Zuckerberg broke the silence and began giving interviews to everyone, assuring that he would do everything to solve the problem. Once again, the public and the authorities saw that it responds to the situation only under pressure.

The New York Times large-scale investigation into Facebook and customized criticism of competitors

In November, The New York Times published a lot of information about Facebook’s top managers ’decisions that brought the company into crisis. From it follows that Zuckerberg and executive director Cheryl Sandberg did not know about the problem of political advertising on the social network until the fall of 2016, although the head of security found traces of “Russian hackers” back in the spring, before the presidential election.

Having learned about the situation, top managers decided to hush up it, believing that this is how they are less likely to risk a reputation. Moreover, the investigation revealed that in some cases decisions to conceal information were taken without Zuckerberg – he simply did not appear at the meetings, allowing Sandberg (responsible for the political direction in the company) to act independently.

Judging by the statement of Zuckerberg himself, he didn’t even know that Facebook Vice President for Communications Elliot Schrage hired Definers PR firm, which wrote critical articles about the company’s competitors. That is, Zuckerberg admitted that, as CEO, he allowed his employees, without his knowledge, to hire a PR organization to slander competitors – for example, Apple and Google.

Attacking Party – Who and What Threatens Facebook

For Facebook critics, the above-mentioned scandals are arguments in favor of the fact that Zuckerberg, his right hand Sheryl Sandberg and the entire management of the company do not cope with their main task: protecting users and their personal data. Moreover, they do not just not cope with this task, but they lie publicly and hush up the information, but admit guilt and begin to apologize only after they are pressed against the wall.

How the public protests to Zuckerberg and Facebook

Throughout the year, all the major US media regularly criticized Zuckerberg’s actions, indicating that he was not doing his job. Criticism erupted from social and political publications like The New York Times , Vanity Fair , The Guardian , the economic The Economic Times , the Financial Times , Forbes and the Business Insider . You can list them for a long time, but these examples are enough to understand what kind of opinion about Facebook is broadcast by publications with a multimillion audience, and what attitude to the company they form with readers.

On December 19, the National Association for the Advancement of Colored People, the organization for the protection of the rights of Muslims in the United States, and 30 more different public communities demanded that Zuckerberg, Sandberg, and Vice President for Politics Joel Kaplan leave office.

“It has become obvious that in its current form, your steering group is not able to adequately solve the actual problems of the civil rights protection communities,” the group says .

In the fall, The New York Times noted that the number of young IT specialists who want to work on Facebook is gradually decreasing due to numerous scandals. A December study by analyst firm Toluna revealed that Facebook topped the list of companies that lost their trust. 40% of the polled thousands of people would not trust their data to the social network.

Most likely, similar sentiments are also found among the company’s employees – problems and accusations of the bankruptcy of the management are beaten not only by the confidence of top managers, but also by all employees. It is hard to work in conditions when it seems that the whole public is opposed to your company.

How dangerous is public criticism for Zuckerberg

Is minimal. Facebook is a huge company with more than two billion users around the world, and most of these people (even Americans) will not give up their usual social network due to the critical media vector and the demands of individual human rights organizations. However, the general mood of the public can not be ignored, because the authorities are looking at them.

What are the shareholders of Facebook dissatisfied with?

Throughout the year, Facebook on the exchange shook tremendously. Cumulatively, from January to December 2018, the price per share of the company fell from about $ 170 to $ 133, and in December the price dropped by 8.5%. These figures are largely dependent on the government’s reaction to problems in the company – the more often politicians criticize Zuckerberg, and the Prosecutor General’s Office threatens to launch an investigation against the company, the worse Facebook feels on the stock exchange.

Falling stock affects Zuckerberg’s personal savings. He began 2018 with a fortune of 75 billion dollars, most of which, in 2016, promised to invest in charity projects. Now he has about 56 billion – this is the sharpest drop among the other 499 people on the list of the richest people in the world. Forbes magazine called Zuckerberg “the main financial failure in 2018”.

How dangerous is shareholder dissatisfaction for Zuckerberg

Facebook’s position on the stock exchange is really undermined, but the company itself is not experiencing critical financial losses. But any instability is alarming for the company’s shareholders, while large ones at least have the opportunity to contact Zuckerberg and personally express their dissatisfaction.

Shareholders are annoyed by another feature of Zuckerberg’s position – his “excessive” power as the head of Facebook. Firstly, he is not only the CEO of the company, but also the chairman of the board of directors who owns a controlling stake in Facebook. Secondly, he has the right at any time and without explanation of reasons to exclude from the council anyone who openly opposes him.

In Silicon Valley, they unanimously say that the board of directors and shareholders have no opportunity to put pressure on Zuckerberg. He reliably protected himself from any internal rebellion.

The idea of ​​forcing Zuckerberg to leave one of the posts has been around for a long time. In April, a large investment group, Open MIC, demanded Zuckerberg to leave the chair of the board of directors, since he could not cope with his duties, having two jobs at the same time. Although Opec MIC does not own Facebook shares, in the past it coordinated the actions of the company’s investors and monitors its development.

A similar situation occurred at the end of September with Tesla Ilona Mask. Like Zuckerberg, he simultaneously served as chairman of the board of directors and general director, but after accusing the Securities Commission of forgery and misleading shareholders, he left his post as chairman.

If Zuckerberg leaves the chair of the board of directors, it will give more independence to the meeting. In theory, it will be able to vote or appoint top managers by voting, without looking at the opinion of the general director. It will also partially restore the company’s reputation and will give critics a clear sign that Facebook is committed to change. In 2019, the board of directors will raise the issue of separation of Zuckerberg’s posts, but the date of the meeting is unknown.

How authorities threaten Facebook

In November, members of the San Francisco Municipal Supervisory Board made a proposal to remove the name Zuckerberg from the name of a major medical center in the city amid scandals around Facebook. In 2015, the creator of the social network donated $ 75 million to the hospital, in gratitude for which she was given the name of the largest private sponsor. The council now believes that this decision should be reversed.

In December, Democrat and US Congressman Bobby Rush publicly turned to Facebook’s board of directors demanding that Zuckerberg and “all other executives responsible for information leaks and lies before Congress be dismissed.”

The American people are tired of excuses, lies and deliberate evasion. It is terrible that we are told the truth only after it is “pulled out” into the light. Facebook is one of the most innovative companies in the world. It is very illogical that his leadership has repeatedly acted against its own policy of consent and made decisions, because of which their product has been and continues to be manipulated and used as a weapon.

from the treatment of Bobby Rush

On December 19, the Washington Prosecutor General’s Office sued Facebook, accusing the company of “manipulating users and failing to protect their personal data.” After that, the company ‘s shares fell by 5% – this is a logical reaction to the government threat to Facebook. In 2019, she promises Zuckerberg a lot of new problems, and a multimillion-dollar fine is not the worst outcome.

How dangerous is government dissatisfaction for Zuckerberg

“At the moment, it is obvious that social networks do not cope with the task of voluntarily ensuring the confidentiality and security of their users. Congress must intervene, ” said Senator Mark Warner in December. This statement directly reflects the current sentiment in the US government regarding Facebook: “If its leadership cannot do its job, we will intervene.”

For many years, the US authorities did not pay attention to the brainchild of Zuckerberg, allowing him to collect information about millions of American citizens. But the scandal with the manipulation of the presidential election and the leak in Cambridge Analytica are perceived by politicians as a threat to national security.

Politicians are seriously discussing the possibility of starting to regulate the work of Facebook, in order to exclude “cyber threats” from other countries.

In other words, government sanctions are the biggest danger to Facebook. The company’s stock price will sharply react to any new attacks from the government, and Zuckerberg will find it harder to avoid pressure from shareholders. The main intrigue is how far the government will go in the fight against Facebook.

Some journalists are seriously considering (and even supporting) the option in which the authorities are beginning to somehow regulate the company’s actions. In their opinion, this will allow Zuckerberg to limit “permissiveness” and help the company return to the “democratic course” it needs (it is not clear what this means). At the same time, for everyone, including supporters of this idea, it is obvious that government intervention in the work of the largest social network in the world is akin to censorship, and it is not clear whether this will turn into a trend in the future.

Side of the defense – how Zuckerberg will act

Little is known about how Zuckerberg will respond to the attacks of opponents. In the spring, he gave an interview in a few days , where he assured that he was not against a wave of criticism of Facebook. According to the author of the social network, for many years everyone treated the company exclusively positively, “and if people want to focus on real problems for several years, I don’t mind, ” Zuckerberg said .

Then he predicted that it would take about a year and a half to resolve the current Facebook errors – that is, by the end of 2019 the situation would normalize. But how exactly is not clear. According to sources from The Wall Street Journal, in June Zuckerberg gathered 50 executives of the company and announced that “Facebook is at war” and he will be in charge according to this provision. Sources of reporters did not explain what Zuckerberg meant.

Zuckerberg was not used to dismiss top managers under public pressure, so he is unlikely to “sacrifice someone.” Theoretically, the loud departure of Cheryl Sandberg, the right-hand man of Zuckerberg, can restore some of Facebook’s reputation and please investors, but this does not help solve problems within the company. Sandberg has been working with Zuckerberg for more than ten years and has good contacts in Washington, so he will not abandon her now that her connections are needed more than ever.

You should not count on Zuckerberg’s voluntary departure from the post of general director and chairman of the board of directors. Firstly, he himself said that he would not go for it. Secondly, he did not create a dual control system in order to abandon it of his own accord. Thirdly, it will not solve the internal security problems on Facebook, but will only please the public and politicians. And when the celebration of the departure of Zuckerberg will be held, the company will again begin to criticize the old problems.

In November, the creator of Facebook told about plans to form for Facebook his own counterpart of the US Supreme Court, which, regardless of the director general and the board of directors, would consider complaints from users and monitor the interaction of content on the social network. As planned by Zuckerberg, this organization will not obey him, and he will not be able to influence her decisions.

I believe independence is important for several reasons. First, it will limit the internal team in the number of decisions taken. Second, it will create accountability and control. Third, it will ensure that decisions are made in the interests of our community, and not for commercial reasons.

Mark Zuckerberg
head of facebook

I do not believe that behind this idea lies a competent plan. Firstly, Zuckerberg did not disclose any details about the creation of such an organization and it is not clear how the experts will be selected and who will lead it. Secondly, the very idea that Zuckerberg creates an organization that in theory can go against his opinion sounds too good to be true. Thirdly, the formation of this “analogue of the Supreme Court” takes a lot of time, and then Facebook has less and less time.

Why Facebook confrontation is a historical event for the global Internet

If Zuckerberg really wants to emerge victorious from the unfolding war, he must have something better than the phantom idea of ​​the Supreme Court. Does he have such an idea? Perhaps, but I do not know what she is. But I know that Zuckerberg definitely does not want to repeat the fate of peer start-ups who have given their creations to strangers, and were doomed to watch how they are completely changed.

Most likely, the disagreements with Zuckerberg on the way forward led to the fact that in 2018 the founders of WhatsApp and Instagram left Facebook . You can recall the scandal last year, when the founder of Uber Travis Kalanik was forced to leave the chair. In the same 2017, the place of the head of Tumblr was left by its creator David Karp, who did not work well with Yahoo !, who bought a startup.

What unites all these people? They created their projects in the free Internet era of the beginning and mid-2000s, when governments of different countries were just eyeing the Internet and did not see in it such a threat as today.

At that time, Tumblr was open to all who were looking for a place to publish erotic content, and it was the absence of restrictions that allowed the project to gain immense popularity. In early December, the service management banned all content with a rating of 18+. It is significant that, following Tumblr, Facebook also became Puritan, banning any hints of sex on social networks. According to one version, Facebook went for it because of a lawsuit on charges of aiding the sex trade – selling and renting people to have sex and perform various sexual services.

What does Zuckerberg himself say about the outcome of the year? In his opinion , 2018 was productively for Facebook, and the team made progress in many areas of concern.

To understand – these problems cannot be solved in one year. For each of these areas, we have developed multi-year plans for the overhaul of our systems, and we are successfully moving in this direction. In the past we have not paid so much attention to these issues, but now we are much more active.

Mark Zuckerberg
head of facebook

In such a positive mood, there is nothing surprising – like any public person, Zuckerberg should look as if he is holding a punch, even if he does not see a way out of this situation.

I’ve been following scandals around Facebook since the end of 2016, and the current position of the company and its founder is clear evidence that the free Internet time is passing. He dies not only in Russia, where Roskomnadzor in an attempt to block Telegram destroys the runet, and not only in China, cut off from the global network by censorship, but also in the technological capital of the United States – Silicon Valley.

Facebook’s confrontation with the public and critics in power is a historical event for the global Internet, and 2019 will be decisive in this clash. But for the time being, I am only wondering: “What will happen if Zuckerberg does not agree with the US authorities, and they will get a blank check on Facebook regulation?” This will be a sign for other IT corporations that the era of their independence and freedom is coming to an end, and they will have to obey the rules dictated by the authorities. And with these conditions, the era of the world Internet free from government intervention will finally disappear.

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