FB have datasets designed to find those people who will register for a conference, sign up to a streaming service or buy a shoe. The same tools also work for "spreading fake news, etc." There are side effects to large scale use of this, beyond the basic. "Bubbles" was a first pass at describing it, but I think it understates the issue by putting the emphasis on groups of people, and implying insularity is the root cause. I think the truth is more individual focused. There are two types of groups. One is the type you could describe in terms of facebook's "social graph," people connected to eachother in various ways. Another is a segment. People who are not necessarily related to eachother, but "inform" on eaother statistically.
Finding a piece of content you will like is becoming finding a piece of news you will believe.
FB are now a news outlet, the biggest and most important one. I don't know if regulation is the best path to a better news media, it could also make things worse. But, what I'm worried about is that FB does not want to be a news outlet. They would like to maintain their "agregator" designation, like the news tab in google search. I'd like to see them abandon that position, and take on the role of news media more consciously and deliberately. Journalism has an ethic, it's not perfect but at least it recognizes that they play a responsible role in society. FB need to adopt something like this, regulaton or not. .