FTC reportedly planning 'record-setting' fine on Facebook for mishandling user data
Brett Larson reports on what the future holds for the social media giant.
One of Facebook CEO Mark Zuckerberg's mentors has soured on the social network and now thinks of it in the same category as addictive public health problems, like smoking.
Roger McNamee, an early investor in the tech giant and co-founder of venture capital firm Elevation Partners, writes about his disappointment with the Menlo Park, Calif. company's increasing public struggles with tamping down on hate speech, disinformation, objectionable content and fake news in his forthcoming book "Zucked: Waking Up to the Facebook Catastrophe."
McNamee recently visited the Federal Trade Commission (FTC) and the Justice Department's Antitrust Division to share his theory about how officials could test whether Facebook is violating federal antitrust law, according to Fast Company, which quoted McNamee's book to explain it:
"Consumers are giving up more value in data than they receive in services. This appears to be true both in the moment and over time, even if consumers are neither aware of it nor troubled by it. If the hypothesis is valid, the price of internet platform services to users has been rising for more than a decade. In the context of anticompetitive behavior against suppliers, advertisers, and competitors, the Chicago School would find that situation to be in violation of its antitrust philosophy. Does it matter that users are not complaining about the “price” of their data? Possibly, but not necessarily."
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According to Fast Company, the tech investor writes that officials were open to his ideas and asked him to speak with economists about producing a formula so that it could be tested with actual data. McNamee also reportedly says that he's met with seven professors, all of whom have expressed interest.
Meanwhile, regulators at the FTC are reportedly considering a "record-setting fine" against Facebook for violating a 2011 consent decree in which the tech firm agreed to protect users' data.
During an event at the World Economic Forum's annual meeting in Davos, McNamee agreed with comments from Salesforce CEO Mark Benioff that likened Facebook and social media generally to the public health crisis of tobacco.
"Marc Benioff has chosen to look at this through the lens of public health, which, in my opinion, is the exactly the right starting point, " McNamee, who has said he still owns shares of Facebook stock, told Business Insider.
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"The incentives to manipulate attention are all about preying on the weakest elements of human psychology. It’s no longer enough just to know a lot about us, the goal now is to change what we think and what we do," he added in his Business Insider statement.
Another big tech critic, Jim Steyer of Common Sense Media, which lobbies for protecting children online, agreed that new action is needed to curb the excesses of Silicon Valley — including the possibility of breaking up behemoths like Facebook, which also owns WhatsApp and Instagram.
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"Maybe they should be forced to divest of Instagram and Facebook. [A breakup] would not be a bad idea at all. Let them concentrate on their core business."
In response to McNamee's book, a Facebook spokesperson told Axios:
"We take criticism seriously. Over the past two years, we've fundamentally changed how we operate to better protect the safety and security of people using Facebook."
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