Facebook's stock went up after the news of a record $ 5 billion FTC bot for various privacy violations broke today.
What, like New York Times Mike Isaac points out, is the real story here: the US government spent months penalizing Facebook's long list of privacy-related misconduct and the best it could doing was so weak that Facebook's share price went up.
From some other perspectives there are $ 5 billion fines, of course: it's the biggest fine in the FTC story, far greater than $ 22 billion of fines charged to Google in 2012. And $ 5 billion is a lot of money, for to be sure . It's just what everything else that comes into contact with Facebook's scale is still too small: Facebook had only $ 1
The largest FTC final in the history of the country basically represents a month with Facebook's revenues, and the company did such a good job of telegraphing it to investors that the stock price went up.
Here's another way of saying it: the biggest FTC finals in US history increased Mark Zuckerberg's net worth.
What lesson would you learn from it? Want someone?
"breaks the law once and breaks it again after you are under a mammoth scale consent order, then breaks so many times that we all lose track of what's happening and you get a relatively modest and get to continue breaking things "- FTC to SV today.
– Lindsey Barrett (@LAM_Barrett) July 12, 2019
There are other elements of the settlement, such as Tony Romm at Washington Post has reported: Facebook must document how it plans to use data before launching new products and performing as Zuckerberg must promise that the company has protected the user's privacy, but none of these conditions prevent Facebook from collecting and sharing data, and will probably not affect Facebook's insanely lucrative advertising activity, which relies on the data.
And as Peter Kafka notes, the cost of regulatory compliance is also not deterrent: Facebook pays fines, eats diets the bottom line for a few lawyers and PR people to ensure compliance with this new order, and continue with the business of, uh, issuing a new worldwide currency while revealing underpaid contractors to cruel videos of people being murdered for $ 15 an hour .
FTC just gave Facebook a Christmas gift five months early.
– David Cicilline (@davidcicilline) July 12, 2019
Members of Congress are already opposed to this settlement – Rep. David Cicilline calls it a "Christmas present" while Senator Ron Wyden says The FTC has "failed bad" Senator Richard Blumenthal says that the decision is "inadequate" and "historic hole", and senator Mark Warner says "It's time for Congress to act."
Facebook made $ 5 billion per avits in just the first three months of last year. The company is too big to monitor, and this drop-in-the-bucket sanction confirms it. The FTC should break Facebook up, clean and simple. Enough is enough.
– Elizabeth Warren (@SenWarren) July 12, 2019
There will surely be many more declarations and strongly formulated condemnations of the FTC in the coming weeks, as the settlement goes through the Ministry of Justice's review and inevitable approval. But words are just words, really. In fact, if our government is to hold Facebook accountable for its ruthless and irresponsible behavior, it must make it, and in such a way that Mark Zuckerberg learns that actions have consequences.