Comment by feelin_googley | Hacker News Reader

Comment by feelin_googley | Hacker News Reader

""Facebook has been playing fast and loose with their data ever since they started. ... It was only a matter of time before that data was misused, and I think that advertisers knew that," said Andy Amendola, senior director of connections strategy at agency The Community. "We know there was this line that verges on creepy because we know the consumers' data, but I think that's what makes the advertising work so well."

For the most part, agencies are skeptical many people are going to leave Facebook - or at least enough to make a difference for advertisers. The public's attention span is fleeting, noted one executive, and even massive data breaches that affected Yahoo, which included 3 billion accounts, and Equifax - 147.9 million accounts - haven't turned people off those services.

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In addition, the public already held Facebook in low regard leading up to the scandal. According to app analytics firm Sensor Tower, sentiment about the company during the the two weeks leading up to the Cambridge Analytica stories was already 83 percent negative - and people were still on the platform."

Source: https://www.cnbc.com/2018/03/22/facebook-cambridge-analytica...

"3. The idea that users will abandon Facebook is unlikely. There's really no alternatives. An abandonment of Facebook and related apps would basically be an abandonment of social media altogether, which is an unrealistic expectation.

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4. While Facebook currently produces the majority of its revenue from advertising, that's only the tip of the iceberg. Facebook can do many things to begin diversifying its revenue stream including entertainment or e-commerce.

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So far Wall Street's opinion on Facebook has not been altered by the data scandal. According to MarketWatch, 37 out 44 analysts rank the stock as a "buy". The average price target is $221.56, which represents 39% upside based on the current stock price of $159.09."

Source: https://seekingalpha.com/article/4158807-facebook-let-others...

> The public's attention span is fleeting, noted one executive, and even massive data breaches that affected Yahoo, which included 3 billion accounts, and Equifax - 147.9 million accounts - haven't turned people off those services.

The public wasn't turned off of Equifax because they weren't Equifax's customers in the first place.

> The public wasn't turned off of Equifax because they weren't Equifax's customers in the first place.

The public aren't even Equifax's users.

> Wall Street's opinion on Facebook has not been altered by the data scandal. According to MarketWatch, 37 out 44 analysts rank the stock as a "buy"

American equity "analysts’ recommendations...provide no (or biased) information related to future stock performance (e.g., Jegadeesh, Kim, Krische, and Lee 2006; Drake, Rees, and Swanson 2009...Bradshaw 2009)" [1]. Some research even concludes "that stock recommendations in the U.S. are either insignificantly (Bradshaw 2004) or negatively (Barniv et al. 2009; Drake et al. 2009) related to future returns" (page 4).

Meanwhile, from the 16 March to 27 March (close to close), Facebook dropped 18% [2]. Over the same interval, the S&P 500 lost 5.1% [3]. (Facebook is in the S&P 500 [4]; the rest of the S&P 500 did better than -5.1%. I chose 16 March since that's the day before the Cambridge Analytica breach broke [5].)

[1] https://pdfs.semanticscholar.org/b4e8/ffa418d387fb57a7cabe89... page 2

[2] https://finance.yahoo.com/quote/FB/history?p=FB

[3] https://finance.yahoo.com/quote/%5EGSPC/history?p=%5EGSPC

[4] http://money.cnn.com/2013/12/11/investing/facebook-sp-500/in...

[5] https://www.nytimes.com/2018/03/17/us/politics/cambridge-ana...

> ... an abandonment of social media altogether, which is an unrealistic expectation.

Really? My parents and siblings, and many friends, tried it, decided it wasn't all that interesting, and left. That's anecdata, but it spans several demographics. People were fine before "social media," so they can probably muddle through without it.

> Facebook can do many things to begin diversifying its revenue stream...

This is where things get scary. Facebook is a surveillance company, and when they can't make money with ads, they will make money in more nefarious ways.

> current stock price of $159.09

Make that $152.22. They're still searching for the bottom.

Facebook has over two billion users; it's network effects are insane. If you want to trade anecdotes, I have a chrome extension that allows me to track which Facebook friends are deleting their accounts, and exactly none have deleted their accounts since this whole thing started (500 friends from around the world, mostly university students).

By "left," I don't mean "deleted their accounts in response to recent news," or even "disabled their accounts." I'm sure they still have accounts, but they never use them because they see no point in doing so. I probably still have an Orkut account, as do many thousands of people, but that doesn't really matter for Google's profits. How many of your "friends" regularly use the thing?

But isnt it true that even for persons who have FB accounts but never use them, because of the presence of "Like buttons" or similar beacons, FB is still setting cookies and tracking those users, as well as non-members, as they navigate the rest of the web.

This assumes that those persons are 1. using browsers that automatically load images, even ones that serve them no purpose and exist only to feed data back to FB and other third parties and 2. taking no steps to prevent their computers from accessing these Facebook domains.

In other words, the fundamentals of the company are still strong. This is the exact kind of buying opportunity people talk about when buying on a dip. This isn’t a falling knife.

Market staying irrational is always a risk. Otherwise, i see recent developments as temporary. Market has very little memory, if any. Advertisers stop spending, but eventually they unlock spend too.

There's also bubbly-market effect, and these might result in deflation a bit.

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