The market has a short memory, and FB is not going anywhere. However, there may be some welcomed changes in data abuse.
With that said, I think the stock is a bargain today.
If users happen to decide that a company is not "cool" anymore or dispase its public figure(Zuckerberg), it may actually go away.
Remember IE(stands for Internet Explorer)? Using Firefox and later Chrome became a crusade and the almighty brand of the richest person in the world that holds the monopoly on computers platforms bled to death.
Every developer on Earth could leave Facebook and it would not make the experience of using fb any worse. Facebook is not a software platform, it’s an ad platform.
If anything fb would get better if we stopped targeting it.
When the Chrome came along, Firefox already put a dent in IE market share and it already became socially unacceptable for techies to use IE but regular people still used IE so the devs were forced to make sure that everything works perfectly on IE too. For the masses, thanks to the developers, IE displayed the websites just fine up until the bitter end.
Friends didn't let friends use IE and it was killed.
It’s far from dead, although we’re finally seeing Edge and Firefox rise a bit more sharply.
Slow-moving, heavily regulated corps with lots of internal legacy apps simply cannot use Chrome with its frequent feature deprecation, weak management, and constant desire to send telemetry and who knows what else to Google servers.
In 2011, Facebook was good at its job, with a chronological news feed, meaningful notifications, and a messenger paradigm that worked much like AIM in the early 2000s -- you could see who was online, away, go invisible, etc. In 2018, Facebook has lost all of those positives, and with it a lot of user engagement, all for the sake of cramming the maximum number of ads down the users throats. And I'm not even getting into the nasty dark UX patterns, like hiding the ability to delete your profile (seriously, there isn't a link to do this anywhere on the site -- you need to search Google for it and they change the link all the time to break external guides) and showing random pictures of "friends who will miss you if you leave!" when you try to delete your account. I don't think your average user would mind leaving Facebook much if there was any actual alternative.
This is just a minor quibble to lambda_lover's point, which still stands. Facebook may understand it's job is to shove as many ads in its users' faces as they will tolerate, but that's not why users use its app. It's users view its job as being useful to them, and being bad at that makes makes FB vulnerable to competitors or even just general dissatisfaction.
:)
Facebook isn't the VC company, Facebook is who those companies hope to sell to later.
Older people can't. I think sharing photos with extended (ie, older) family is a huge use case for Facebook.
Politics and some hobby groups are on Facebook and interesting, but the real meat is the personal photos and stories that would never be in the news.
People can adapt. In my fantasy football group we used to do Facebook messages until me and another friend dropped Facebook. Now we do group messages or groupme. People you care about will find a way to contact you.
Exactly - that's the danger for FB. If the coolest of kids head somewhere else, that strong social pressure works against FB and not for it.
Then anything he touches becomes toxic. Zuckerberg isn't even divisive like Trump, he may have issue finding people to rally with him against the deserters.
I wanted these platforms to succeed, I've had an account and tried using most of them - Diaspora, Friendica, Red Matrix, someothermatrixIdontrememberthenameof, Mastodon, identica/statusnet, ... They're all the same. (I'm sure I'm forgetting at least one or two, but they all blend together.)
Digg was abandoned because it broke itself. The codebase that all those users knew and depended on was completely trashed (the original author hangs out here sometimes), the site dropped a number of its key functions, and the user experience was redesigned to maximize Digg's ability to show ads, no matter how obnoxious that got, with many people saying that it was almost entirely ads by this point (I had personally stopped using Digg years before the big v4 debacle, so I can't speak to this directly).
People want the path of least resistance. They'll tolerate some ads, but their tolerance ends when it's just easier to click over to the other guy's site and get a comparable experience. If you neuter/break Digg, and reddit is right there, well...
The path of least resistance for Facebook users is still Facebook, regardless of the news cycle. Facebook will remain dominant until it is no longer the path of least resistance, just like everything else.
Users have different levels of tolerance. The moment a switch is the path of least resistance differs for everyone, usually corresponding to their level of emotional investment in the platform and their individual tech savvy. Facebook has a lot of very invested, very non-tech-savvy users.
The right types of questions to ask are along the lines of whether we're sure competitors have sufficient ground to catch up to massive incumbents and keep them honest (and in this case specifically, whether certain misrepresentations or violations occurred that should be made to materially affect market standing through government intervention). For the most part, tech is non-competitive due to terrible legislation like the CFAA.
That case is about an almost identical twin, but I would also consider sites that are not so similar but serving the same function. I haven't had a Facebook account so not sure what it is exactly, but people are happy as long as I have Whatsapp.
I don't see how there could ever be any viable competition. Facebook already has many of the top engineering minds in the world who are pushing the edge of what computers are capable of, not to mention the largest database and neural network of human behavior ever created.
How is any of that necessary?
I don't give a shit about their bleeding-edge neural network or army of PhDs. I just want to send my mom pictures of my kids and maybe send an occasional party invitation to some friends. What does Skynet contribute to this workflow?
I would argue that all that technical bloat only made the Facebook experience worse. Facebook itself had humble beginnings. All a competitor needs is a LAMP or MEAN stack, an experience worth migrating to, and enough ethical sense to not treat its userbase like a science experiment.
It also needs the ability to make the transition plausible for consumers. There's really no reason that Facebook should be able to enforce a stringent walled garden and bar specific user agents that aren't negatively impacting the network and aren't exceeding the access of the user they represent.
But Facebook did exactly this in Facebook v. Power Ventures, leaving an entrepreneur with a ruined business and a bill for $3M in damages for creating a system that exfiltrated only one's own personal, copyrighted data from Facebook. It wasn't even taking other peoples' feeds or trying to multiplex data. It was simply trying to make one's own data accessible and portable.
Large tech companies have done this for decades, abusing the CFAA and the Copyright Act to enforce de facto platform monopolies. These companies know that if they can't assert ownership over the data, they'll have to compete on merit in the open marketplace, and who wants to deal with that?
This is also why you don't see new protocols like POP3 or NNTP anymore. Academics trying to build a transparently-syndicated collaboration platform are out. Big companies looking to hoard your data and assert some type of incidental, indirect ownership over it are in, and they want to make sure that you don't really have the option to leave. Lock-in is king.
Once a critical mass outside of the tech-savvy early adopter crowd is obtained, aggressive legal methods like those used against Power allow incumbents to hold onto power in perpetuity. Granny doesn't care about all of that tech mumbo-jumbo. She just knows that she can't see Auntie's pictures anymore because you broke it by switching her to F+. Since they're legally forbidden from multiplexing Facebook's content into a universal "social media reader", Granny's options are to stare at a blank feed or go back to Facebook -- even though Auntie would be perfectly willing to allow Granny to see her content through F+, and it's really more of an accident that Facebook is the platform that received the initial post.
What is Granny gonna do in this situation? Why have we awarded tech companies the right to hold user-generated content hostage like this? Wrap anything in custom HTML and it's suddenly very difficult for a third-party to access it without infringing your copyright on the exterior HTML wrapping, regardless of the status of the content inside. In the US, it's infringement to load copyrighted content into RAM, per the RAM Copy Doctrine.
Good luck convincing a technologically-illiterate judge that your software is no more disruptive than Chrome or Firefox, especially when you have to do so over the objections of Facebook's $X000/hr law firms and previously-referenced army of PhDs.
Such rules have stifled online innovation for decades now, and they're the reason that the internet is becoming a walled garden.
Under the GDPR, which mandates all companies provide a machine-readable export of user data within some fairly short timeframe (less than a week iirc), things may become marginally more fluid for people in EU countries, but I wouldn't count on it.
Disclaimer: not a lawyer
This is already sort of happening anyway with the "my parents are on Facebook now" problem. That I think is a much bigger threat to Facebook's future than any regulations that are coming.
Re: GP's examples, Uber is a "user-facing" company, and the Wells Fargo and Bank of America scandals involved consumer services.
Also, it's not like companies are incapable of making conscientious decisions with regard to other companies with which they do business.
A distinction without a difference.
[0]https://en.wikipedia.org/wiki/Usage_share_of_web_browsers#/m...
It was no-brainer to switch to Chrome.
Also, Google was this cool company that was giving away revolutionary products. Don't do evil was their motto.
If you want Facebook to die you have to come up with an alternative with improved usability to convince people to switch over. Now you have do that with the added handicap of "do no evil" (so less money from targeted advertising etc...) while fighting to gain market share against some of the biggest companies in the world. My guess is that if you manage to do all of that you'll just end up bought by Facebook anyway.
Of course.. unfortunately you can't say no when some behemoth wants to buy you. /s
Honestly if fb were to just take the money from me and leave me alone i'd be happy to pay that ransom for my friends.
Most importantly, those who wished to make the switch from IE to Firefox or Chrome or Safari or Opera, etc. could do so without requiring any additional action by others. Again, outside of a few compatibility issues on a few sites, I could change the software I used without convincing webmasters or other users to do anything.
Same went for webmail. I could switch to Yahoo or Gmail or Hotmail or whatever I wanted without requiring me to convince every other relative, friend, and business contact to do the same.
With something like Facebook, you can't just use a different platform to interact with those same people in the same way unless you convince them all to migrate with you. If everyone you know only wants to use Facebook, then that's your option. You can't set up your profile on Diaspora or Google+ or whatever and expect to enjoy all the things you prefer about them because there's no shared protocol like there is with web browsing or email.
You can get away with a pretty much anything as long as it's legal, not a big symbol, or that you have money to bypass the legal issue: the public won't hold you responsible for long.
Here it's even worst, because it's also coupled with a total lack of interest. People mostly don't care about co-creating a society. They just want to enjoy the rewards of it right now.
Unless pictures of them doing something they are ashamed of are displayed on a highway billboard, data privacy is not even on their map.
The FB consent degree was ignored and so far had little effect. I doubt it will continue to be ignored now as the following has changed:
- FB leveraged by Russian trolls and via data leakage affected the US Presidential elections. Puts the spotlight of politics on social media and FB in particular
- same for Brexit
- GDPR in Europe is a big thing with penalties
- US branches of government shifting left over the next 4 years in reaction to extremist right policies.
- Younger people get Mr. Robot. Older people die. Demographics have been shifting audience away from FB for some time.
These are trends that will not go away. They will affect every decision within FB and with it the growth trajectory.
The conspiracy theorist in me would say that Facebook is reaching the end of its lifecycle and the company has prepared itself in advance for the move to newer social media platforms, and that they’re not particularly concerned about people leaving Facebook.
However, all those were acquisitions. I think Facebook's doomed if it's ever prevented from buying rival social networks. I think trend cycles can throw a wrench in network effects, and Facebook's too established to really innovate in this category.
Yeah, good luck electing FDR (or even a lite version) in the USA for the next decades.
The problem with Equifax is that I can't do anything to retaliate against the company.
Facebook, this kind of stuff is inherent in their business model. Our data is the only obvious thing they can turn into money.
You could freeze your credit with Equifax, if you're not looking to take out new credit lines. It costs money, but I've heard it pretty much stops them from making money off your info. That's why the credit agencies are pushing things like "credit locks," which don't have legal mandates behind them meaning they can design the service to suit themselves.
They are a financial stalker for others
However, I'm not an expert and I'd like to hear more about this.
There was an awakening, the public mood changed, people were energized and emboldened to take action. What used to be an open secret is now taboo and many powerful men have been fired and disgraced.
Remember the awakening about the unhealthy effects of sugary carbonated beverages? That wasn't a one-time fad as sales of soda in the US have dropped every year for the last 12 years.
Similar awakenings are now happening in economics, politics, law enforcement, and now digital rights and privacy.
I'd be very surprised if the outrage fades away with no serious damage to Facebook.
Quitting Facebook leads to higher levels of well-being [1]. People are waking up to this reality, just like they woke up to the dangers of smoking, and it's long-term negative for Facebook and their shareholders.
[0] https://www.reuters.com/article/us-soda-sales-study/u-s-soda...
I suspect where possible, politicians prefer to minimize the number of highly influential entities. That the public is also helped is just gravy.
Like, when you could brag about benefitting from that, and still be President? I remember that like it was the day after yesterday...
People think voting with your wallet doesn't change a thing -> they keep buying from unethical companies -> nothing changes -> voting with your wallet doesn't change a thing.
The problem is that it's always the same small group of people who actually change their commercial choices based on companies' ethics. I've avoided Lenovo like the plague since superfish, but I know people who've bought lenovo laptops even knowing quite well about the superfish issue and understanding what firmware level malware means.
Maybe FB isn't going anywhere but if users and advertisers do you can be sure the market will reflect that.
I could flip your comment though. Unless you have some clairvoyant powers you don't actually know that "Fallout from this is forthcoming". There may be no further negative fallout from this.
There are at a number of significant events in FB's future being hauled in front of Congress in the US, being hauled in front of Parliament in the UK, the FTC investigation, numerous state attorney general's investigations and of course shareholder lawsuits.
I think its fair to say that the fallout is not yet done.
It might be the case that the sum is greater than the parts, but I don't know if the market would respond to a split from a purely rational stance, at least initially.
The stock was literally dead money for decades and the ramifications are clear. The recent selling pressure is driven to an extent by memories of Microsoft and the financial impact. The stock is in no meaningful sense a bargain.
But they finally got a credible cloud strategy together which recognized today's realities which is why their stock is doing better.
I won't say anti-trust had no impact but they had more fundamental problems.
> “They’re afraid, it seems. Whether it’s antitrust in U.S. or in Europe, they seem to be slowly reacting to the world around them, rather than trying to get in there fast."
Certainly some academics would nontrivially attribute the strategic moves to anti-trust-related conservatism
That's very disingenuous for you to say. If you are in it, you should disclaim it so that others know why you paddle it. If you know anything on TA (technical analyst) you know it broke uptrend and major barriers and will temporarily stop around 140-150 before it decides what to do next. In mere you should warn its your personal opinion.
A sustained 20% drop in market share for a very large, very established company that has fairly few competitors, substantial network effects, and a high barrier to entry. That's a significant drop. It didn't wipe out the company, no, but it's a far cry from saying that "the market doesn't remember" - in this case, the market very clearly did remember.
Is it even possible to come up with an answer for this?
and how can consumers avoid giving business to equifax?
And still falling. A dark part of me hopes the sharks looking to make a profit without recognition of how Facebook is in really deep shit just lose everything. A lot of glib predictions about catching falling knives here, but they seem to ignore Facebook not being quite as essential or inescapable as someone’s bank or credit reporting agency.
People don’t really understand Equifax, and simple breaches don’t bother them as much actively manipulated. Facebook provides a really nominal service for most people, and I think some here are trying very hard to convince themselves this is something other than their bubble being pricked.
Good luck.
Given the existence of the shadow profile, FB is exactly as inescapable as a credit reporting agency.
That's not true. Facebook has data, but their data isn't as valuable and important to individuals as that controlled by a credit reporting agency.
For instance, Equifax has info to enable straightforward identity theft, and I need all that data to be there if I want reasonable terms on a loan I may want.
The Facebook social graph is mainly valuable to advertisers and intelligence agencies, both of which I can happily ignore day-to-day. It's data could be a tool for identity theft, but I doubt they have the SSNs or CC numbers in their shadow profiles needed to make that easy.
“Nobody cares” feels more like desperate wishing/spinning, and it’s getting old in a hurry. It also ignores how this is being driven by Trump’s election, which has freaked a lot of people out, and by a general backlash against big tech. A lot of anecdotes are being bandied about, in the face of a lot of realities that are not anecdotal.
So buy the stock, but don’t be shocked when like Moore’s Law, past performance fails to predict future gains.
Do I care? Sure I do. But will a tiny minority of tech users matter to the stock in the long term? Unlikely.
Its quite possible that the stock is oversold at this point.
Its not wishing/spinning. At this point it does look quite plausible.
How did "the market" not notice?
Uber will likely go into bankruptcy soon, if everyone remains very vigilant about their failed self-driving car project. Because without it, Uber is done. The self-driving car project was the last thing the investors hoped would save the company. And it won't.
People also remember Equifax. There is just little they could do, because they don't directly deal with Equifax. It's their banks or credit card companies that do. Plus, Congress almost immediately saved Equifax from lawsuits, and people haven't yet had an opportunity to "respond" to that. They will this fall.