That said, I'm not going to demonize these guys. Brian Acton clearly is repentant and putting his money where his mouth is in terms of supporting Signal, and that's worth a lot more than some principled nobody who never has enough clout to further his own principles in society.
I am not convinced Brian learned the right lessons here.
Contemporaneous to this was the rewrite of the privacy policy to allow sharing of metadata between FB and WhatsApp user accounts, which was a bit of a sell out.
WhatsApp end-to-end encryption didn't actually begin until after the acquisition to Facebook had already gone through[0].
I am certain that, as of 2012-2013, WhatsApp wasn't even consistently using TLS to encrypt traffic. That's what made it so shocking when they suddenly leapt from some of the worst security practices of all messaging apps on the market to the best[1]. They built a massive userbase long before any efforts were made towards privacy and encryption.
[0] https://www.pcmag.com/article2/0,2817,2472340,00.asp
[1] Signal didn't exist at the time, and yes, TextSecure existed, but almost nobody was using it compared to WhatsApp or any other chat app on the market today.
I believe most users simply use it because it is the most used messaging app in their country
It's difficult to understand for the average person just how much Facebook knows about you and what it can do with that information that isn't in your direct interest. At best they think it's weird how long-lost acquaintances show up as suggested connections, at worst they only notice when Facebook does something directly useful to them.
Sure, you can blame the users, but that's kind of unfair if you consider what kinds of markets WhatsApp already dominated before the acquisition.
Why does every thread on Hacker News have to ask this freaking question? It’s obvious that the general public is computer illiterate, Sherlock, just like it is obvious everybody knows someone “good with computers” that can tell them what to use and having lived the sunset if Yahoo Messenger in my country, Facebook should be scared as it happened practically overnight.
Edit: Note: WhatsApp publicly claimed that a billion users paying $1 each is enough for them. Also remember, a lot of the technical complexity, infrastructure requirement and data storage requirements went away in their model of being just a conduit. They had no interest in reading, parsing, mining, storing or monetizing the messages. This let them run it with a lean crew.
[1] https://www.wired.co.uk/article/whatsapp-on-ios-now-free
We're entering a world of a widening disparity between rich and poor. A billion dollars puts you, your children, and their children in the very wealthy side of that line for their entire lives. That's hard to say no to.
https://www.gatesnotes.com/Development/Goalkeepers?WT.mc_id=...
Obviously a very ironic source but the others were more political.
https://en.wikipedia.org/wiki/Capital_in_the_Twenty-First_Ce...
If anyone is looking for data-driven cases on the scale and negative consequences of the increasing divide between rich and poor, I've found some good resources in Robert McChesney's The Digital Disconnect, Joseph Stiglitz's The Price of Inequality, and probably most famously Thomas Piketty's 2014 book Capital in the Twenty-First century which Gates himself even recommended, ironically enough. All these books come under criticism for supposed ideological undertones, but even skeptics generally respect the underlying economic data.
I don’t know if inequality can be reduced on a macro level, but I would not bet on it.
Some things can be changed and some can’t. Your example of maternal health is great—we should be focused more on those types of biological things we can change, imo. Who cares if someone is richer than you if you are healthy and happy?
But inequality seems to be something nature loves. The sun gets 99% of the matter in the solar system, for example. Humans decimated all other large predators—examples abound.
Concentrated freedom and decision making power (for which money is just a proxy), might be a necessary evil. I think barring a drastic black swan paradigm shift (world government, computer overlords, or maybe some undiscovered push to an equilibrium driven by globalization...), there’s not much that might change that.
But you must recognize that human society is simply the summation of many individual choices, and there is a big difference between saying something is unlikely to happen, and something cannot happen. Pragmatism and cowardly cynicism are two different positions with dramatically different possible outcomes. Instead of accepting Keynes over Polanyi as a foregone conclusion, try looking at the individual choices that were made to get us to this position. Repealing Glass-Steagall in the '90s was a choice. Deregulation in the '80s was a choice. 100 million Americans eligible to register choosing not to vote out politicians who make these decisions are 100 million choices. There may be systemic reasons for why those choices were made, but I am simply right now trying to get you to see that these outcomes are not foregone conclusions.
Your justifying logic for holding your beliefs is certainly not rigorous -- you can just as easily find examples of nature favoring equilibrium and balance in every conceivable force diagram or cell membrane as you can of the existence of inequality. If you are looking for a nature metaphor, why not try a chemical reaction? In an inert environment, oxygen molecules will not spontaneously transform into carbon dioxide, even though carbon dioxide is a more stable chemical state. But once the necessary conditions exist -- the presence of sufficient carbon and enough available activation energy to perform the reaction -- a single spark can cause a chain reaction to convert every single oxygen molecule present into carbon dioxide molecule. No matter if previously, every oxygen molecule was insisting, "But this is the way things have always been for us! Some things can be changed, and some things can't."
We have not yet reached the necessary conditions for our society to reach a more stable state, so you are not wrong in saying that it seems unlikely that the reduction in inequality can occur without certain tipping points being reached. But it is folly to conclude "...there's not much that might change that" without educating yourself on the missing conditions and realizing that it is possible to slowly work towards achieving those conditions or empower others who are taking steps to achieve those conditions. Conditions like political will, corporate regulations and safeguards against regulatory capture, fighting disinformation campaigns, and educating people on the harms of inequality, done very well by thinkers like Stiglitz, Varoufakis, McChesney, Chibber, Polanyi, Bernie Sanders, John Kay, Tim Wu, and many others who have considered the effects and are working on solutions. So that when that single spark comes along -- a great leader who can move the masses to rally behind a vision of a better world -- hopefully we will have done enough to move in the correct direction. We are closer than we think probably, if you look at how close the elections of Gore and Sanders were, for example.
But, I should say in the end I am encouraged by anyone who is willing to read and educate themselves on the matter and engage with differing viewpoints. I wouldn't go so far as to say that I am optimistic for the future, but I will do whatever is in my power to create a fighting chance for those who have not yet given up in the face of difficult odds.
But overall, the gains of technology are being concentrated in a few hands.
The economists say that wealth is primarily created by tech change, everything else is just a functioning economy working as it would.
It seems that the low base effect makes every thing better off if you were terribly off. But if you were middle income you are worse off.
there was an anti-monetization clause in the contract. you don’t put that there out of an over abundance of caution. they knew exactly FB’s intentions. they maybe didn’t expect it to come home to roost so quickly, but they should have. again, these are smart guys. they just couldn’t get past the billions, plain and simple.
It's not their fault as it was not their responsibility to provide a private message service for free to millions of people.
This is just how it works, if want to be principled you can't make agreements with the devil.
Facebook has been lying to us since at least 2007. People were always okay with it because they perceived it as being okay and supportive of the right people and policies.
This seems less Facebook specific and more "that's simply what happens with all acquisitions".
> This seems less Facebook specific and more "that's simply what happens with all acquisitions".
I don't know what was going through their heads but as an outsider with no insider knowledge, I justified this as Facebook making sure nobody else gets hold of Whatsapp's user base. It made sense in my head back then.
Yep. 2 years. That's usually the amount time that an acquirer will leave you be.
That Zuckerberg, at the young age, managed to retain control of facebook all the way up to, and beyond, the ICO should have given them pause so. That hints a certain personality (no judgement intended in that assessment). But that is 20/20 hindsight which is always easy.
Freudian slip? :)
You should never “trust” anyone who you do business with outside of a contract.
In this specific case Mark Zuckerberg holds controlling amount of the stock.
I’ve had a manager before who supported everything I was doing but when he was let go, I was left hanging in the wind. I’ve slso had a manager who wouldn’t listen to me (I was the Dev lead), everything failed in just the way I warned it would and I could see he was going to blame me.
Never trust a company - and by extension your manager who represents the company to his reports.
That’s about like the people who trust HR.
https://www.boston.com/news/policy/2018/08/16/elizabeth-warr...
"Warren attributes those problems to a shift, which she says dates back to the 1980s, in the obligations of corporations — from balancing responsibilities to all their stakeholders — including both employees and stock owners — to prioritizing their financial return to shareholders only."
(That's not exactly responsive to your point on maximizing profit, but the body of work on this topic shows that when companies care about long-term return, and about employees and other stakeholders, they aren't solely focused on maximizing short-term profit over all else.)
Starting in 1970, Milton Friedman argued that the sole purpose of a corporation was to increase shareholder value, and all of its other activities - providing jobs, fighting pollution, enhancing social justice, even serving customers - were subservient to that, to be engaged in only if they also helped profits. It took a while for this view to catch on, but following Reagan's election, it gained a lot of popularity in political & legal circles, and was firmly entrenched among business leaders by the mid-80s.
The problem is that we've since discovered a number of ways that corporations can enhance shareholder value (as measured by stock price) without actually benefitting customers, and most of them involve strip-mining value built up over the long term at the expense of the future. And so a significant fraction of the population is just engaged in financial games while they get busy firing everyone who does actual work.
I think of this as the conversion of social capital into financial. The monetisation of things that used to be personal relationships, such as becoming intermediaries what used to be direct interaction.
For example, Facebook could've over-induldged on overlay full-screen ads or "watch this video for 30 seconds before proceeding" ads, but they chose not to.
Any public company that is not majority owned by one person and is not maximizing their profit is a target of a Carl Icahn type of investor, who will buy up enough shares to force them to maximize profits.
Your identity is no longer tied to the company and the only thing left is how much profit per share.
It's sort of like a microchasm of socialism or communism. If you own 9% of apple, people don't blame you personally when apple misbehaves.
Facebook's complete disregard for them should not be the norm, even if it, sadly, might be more often than not.
> There is such a thing as business ethics.
> Facebook's complete disregard for them should not be the norm, even if it, sadly, might be more often than not.
It's alarming how businesses' lack of business ethics is getting normalized by comments like the grandparent's. We should require that companies be ethical and condemn them when they aren't. Yes, we'll often be disappointed, just like we're disappointed with the fraction of humanity that becomes criminal, but that doesn't mean we should lower our standards.
Yes, we should require them. The WhatsApp founder didn't attempt that, he just hoped they wouldn't.
I suspect that a large class of these "business ethics" violations are actually torts, but the problem with enforcing them is that to do so you a.) need to know what your rights are b.) need to detect violations of them and c.) need to bring a lawsuit against the offender. I remember that on Google's invention disclosure form, one of the questions was "How easy would it be to detect if a competitor was using this invention in their product?", and if the answer was "We'd never know", we wouldn't patent the idea and would keep it as a trade secret instead, on the assumption that if a competitor could use the invention illegally without us knowing about it, they would, and so it was better to deny them knowledge of the invention entirely than to publish and try to enforce unenforceable rights.
When the aggrieved party is a consumer or worker, it's triply difficult, as most consumers a.) aren't aware of their rights b.) have no information about what's going on inside big corporations and c.) don't have money to sue even if they know. Many of the ethical problems in U.S. business today stem from the legal system not being able to scale up to 300M often poorly-informed citizens.
In this case, Acton's not the aggrieved party. The consumer is - they could argue that Facebook's introduction of advertising and linking of user data harmed them in a way they had not agreed to when they signed up for Whatsapp, or that its purchase violated antitrust law and reduced consumer choice. But good luck enforcing that, at least in the US, where privacy protections are weak and antitrust regulators are asleep. It looks like the EU regulators actually did enforce it, and slapped FB with a $122M fine, but that's peanuts for them.
I expect/require that people not steal from me even though I don't have a contract or prior agreement with them, and I also predict that some people won't respect my property.
How does this apply to the founders though. They sold, so isn't WhatsApp now not their property?
You mean, except for criminal law? I don't see how this is in any way equivalent to adding ads to Whatsapp.
It's not against the law to lie to me in most cases, but I still have the same expectation/requirement that people will be honest with me that I do that they won't steal.
I wouldn't trust a handshake agreement on a used car.
If you feel strongly about it go further and organize more people to do the same. Try to convince people who don't feel the company is unethical that it is.
But in the end you can't expect because you don't like a company that your feelings on what should happen to come to be.
It's like so many people complaining on Twitter about Twitter not banning voices they don't like. If you don't like Twitter's policies then stop using their product. If enough people agree with you and do this they will change. If you feel it's worth spending your life organizing people to boycott Twitter then spend your life doing that. But the culture of demanding that platforms must adhere to someones arbitrary expectations as if using their platform is a right is ridiculous.
I don't know very much about Lyft but I have yet to hear anything bad about them which is pretty encouraging.
One of the Uber criticisms is that they don't respect local laws when they do such expansions, so maybe that is part of why Lyft might be more cautious. Still, non-US markets and global user bases are much more of a thing as time goes on, so it feels like they're very severely missing out.
Even if your manager is ethical and “cares” about the well being of his employees, his manager may not. Even if his manager does the board, the investors/shareholders, etc. probably don’t. The whole purpose of a corporation is that a corporation survives without regards of any one person getting hit by a bus.
I worked for a struggling company a few years ago and management was very honest about the dire straights we were in, I was part of the team who sat in on interviews and did presentations for potential acquirers so I knew what was going on.
I trusted management not to purposefully screw me over. But at the end of the day, if they “guaranteed me” that my check would clear for every hour I worked I wouldn’t have believed them. The only reason I stayed until the bitter end was because our VC backers promised us in writing that we would be payed until we got an official layoff notice.
This is defeatist. Corporations can be sued in courts, just like people. Their obligations are binding, just like peoples'. There is a little more complexity to signing a deal with a corporation than a natural person because there are multiple sapient interests involved, but that's what lawyers are for.
Protecting users' privacy was never prioritized in the acquisition process. If it had been, the anti-monetization clause would have been stronger.
That's okay. We're talking about billions of dollars. But turning around and playing the good guy will take these men more than simply claiming ignorance.
I never said that companies go around breaking legally binding contracts or there is no recourse if they do. I said you shouldn’t trust a handshake deal when doing any business that amounts to real money. Get it in writing.
TL;DR version of which is "Make as much money as possible or become irrelevant note in history"
Edit: Oh, please. Downvotes keep demonstrating a total disconnect between HN responses that require pushing a downvote button and say mass resignation from Google or Facebook or Whatsapp or Well Fargo or Equifax that might trigger a response.
So yes, the only business ethics that is relevant in the real world is "Make as much money as possible".
They're not noteworthy because they're the norm, not the exception.
These are the same businesses that everyone at HN laughs at as they only pay $40k/year for senior software engineers.
They sold the company. By selling the company they have become employees, not founders with control. If they did not like it, they should not have sold. If they are remorseful, they can donate 100% of all the money that they made from a sale of the company as well as all the interest that they have accumulated to some me-so-sorry non-profit. Not 10%. Not 50%. 100%. Otherwise those are just empty words, just like protests of HN crowd working for Google, Facebook, Equifax, etc.: empty words that make them feel better.
Who's PR firm is behind this and the originally posted TC piece [1]? What's their angle? And Why?
[0] http://www.paulgraham.com/submarine.html
[1] https://techcrunch.com/2018/09/26/whatsapp-founder-brian-act... https://news.ycombinator.com/item?id=18076008
They will always do what is in their best interest when it is in their interest to do so
I had 0 knowledge about business back then and even u could figure out that something didn't add up.
PS: I'd be happy to pay them $1/month because a significant part of my communication happens over WhatsApp. The challenge is $1/month is probably too pricey for most of their user base.
Most WhatsApp users aren't American, and in a lot of places $1 is a more significant price tag. That aside though, some places don't have the infrastructure or trust to even allow any sort of online payment to happen: a lot of people in India don't have credit cards, and being from Mexico myself, I know a lot of people who do don't trust online transactions enough to pay with it online.
If you think you need tens of millions of dollars annually to run a chat client at scale, no.
[1] https://help.openstreetmap.org/questions/9867/what-is-annual... (OpenStreetMap infrastructure costs less than $100k/year)
> I would ask for proof people would be outraged. Google and Facebook have used their overwhelming first world profits to fund internet ventures in the third world, and no one is outraged over the actions except for the blatant colonialism the actions represent.
Well, obviously you can't prove a hypothetical, but the "outrage" suggested here isn't about for-profit companies funding charities. It's about being charged even minimal amounts for services. Google and Facebook do not charge users for their core services, so they are not good comparison points.
Users were paying for Whatsapp [1]. I believe that data point illustrates that users would pay $1/year for a chat service, but this is just an opinion until someone decides to stand up a new service and charges for it.
[1] The evolution of WhatsApp - in rumours and revenues WhatsApp had dabbled with the subscription revenue model in 2014, which amounted to charging an annual $0.99 membership fee, and earned above $1 billion in the first nine months of instating this fee. But following their $19-billion acquisition by Facebook, they came to revoke these charges, and WhatsApp was a free ride for its one-billion-strong and counting user base again."
The only reason WhatsApp exists is that international carriers were charging higher fees for text messaging while offering lower data rates, creating an arbitrage opportunity. WhatsApp never took off in the U.S. because U.S. carriers were ahead of the curve in shifting to free texting (thanks to the iPhone popularizing unlimited consumer data plans). So yes, this puts a hard ceiling on what WhatsApp could charge.
And that makes them feigning they thought they could justify a $19B valuation without increasing monetization all the more ridiculous. Of course they knew what would happen. That's why the deal was "if you monetize we vest all our stock and leave and cry out loud all the way to the bank," not "you can't monetize."
The prospect of ad revenue is a bonus.
I was born and raised in a third world country and 99% of my family and friends still live there. Our GDP per capita is around $1,000 (yearly figure). I know people with children who make no more than $150 per month and cannot afford their own apartment. I know people who make even less. I know people who live in villages and probably have a monthly budget of no more than $80-$100.
Yet I have very rarely met people who somehow aren't spending at least $5 per month on their phone bill (buying minutes).
In fact I was very surprised to find that not only nearly everyone has a mobile phone, BUT phone service was more expensive than they are in the US. For example one hour at an internet cafe will set you back 50 cents. Yet everyone has a mobile phone, about half have a smartphone (granted a cheaper version of Android) and people buy internet connection left and right. In America, you walk into any coffee shop, get a free water, a free internet connection and a Thank You.
I say this to say, that WhatsApp could charge $2 per month and most people will happily pay it.
It would be more valid to compare it to carrier text messaging fees, which was the arbitrage opportunity they exploited. But that opportunity is mostly gone now that everyone has smartphones. If WhatsApp charged $2/month they would face the same challenge from upstart apps that carriers faced from WhatsApp.
* I pay $60/mo for my AT&T line. I do the majority of my communication over WhatsApp. In that sense, WhatsApp adds more value to my life than AT&T. There are a group of users who'd be willing to pay more for that value.
* For most users, WhatsApp is an integral part of how they communicate with friends, family, doctors, coworkers, etc. As a consumer, it isn't just an "app" but an integral part of their communication flow.
* WhatsApp is respected by international telcos. I know at least for the telcos in my home country that they'd be happy to charge for WhatsApp subscription as part of their packages.
I think the primary problem was that even if WhatsApp could monetize $1-3/yr per user on average, it still wouldn't have met FB's revenue expectations.
[0] https://www.businessinsider.com/well-these-new-zuckerberg-im...
- Mark Zuckerberg in 2003