Meta might consider leaving Europe? | Hacker News Reader

Meta might consider leaving Europe?

81 pointsGys79 comments

Meta submitted their yearly report to the SEC [0] which states:

> If a new transatlantic data transfer framework is not adopted and we are unable to continue to rely on SCCs or rely upon other alternative means of data transfers from Europe to the United States, we will likely be unable to offer a number of our most significant products and services, including Facebook and Instagram, in Europe, which would materially and adversely affect our business, financial condition, and results of operations.

[0] https://d18rn0p25nwr6d.cloudfront.net/CIK-0001326801/14039b47-2e2f-4054-9dc5-71bcc7cf01ce.pdf

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It means nothing. Companies mention every imaginable contingency in SEC filings to protect themselves from lawsuits in case it actually happens.

Yea and no - companies don't mention every possible risk they can imagine, they mention risks they have thought of that seem credible - everything else is covered in more generic clauses that amount to "life is unpredictable". If they called it out, someone believes it to be a potential risk, but does not mean they think it is likely to come to fruition.

What would the lawsuit be and who would it be from? Shareholders?

The notion of FB abandoning a market of 500m comparatively rich people just because they can’t shuttle data around seems rather absurd to me

No data == no income for FB?

But it's no data out of Europe, not no data. Don't want to be governed by EU privacy laws medium/long term?

California's CCPA/CCRA is about the same as GDPR, and increasingly used as the template for state-level privacy laws in the US. Are they going to leave the US as well?

Now there is an issue with the extraterritorial overreach of the US CLOUD Act, which means the surveillance dragnet is extended to any US company, even if the data is hosted on servers outside the US. A strict reading of GDPR and Schrems II would mean that it is actually unlawful for Facebook to offer services in the EU.

I also don't think that they would completely abandon it, but if non-targeted advertisements are not generating enough value, they could switch to a paid subscription model. They would certainly lose many users, but as all competitors have the same issue, their monopoly position may allow it.

I sometimes wonder if social media companies think threats like this hold weight the way it would if a car factory threatened to leave. I just see “Europe” shrugging at this one.

Why would it just shrug? Lots of people here looooove FB :( Twatter in europe is much smaller than in US. At least in my country all the cool stuff seem to happen on FB. Telegram is slowly gaining speed though. But it would a lot for the regular non-IT people to move over.

> Why would it just shrug? Lots of people here looooove FB :(

Sure, but if Meta is going to continue being a pratty American company with no respect for how things are done on your side of the pond, where not leaving people open to naked predation by bigcorps is a fundamental principle, I don't think most Europeans would miss it that terribly much. Homegrown alternatives would emerge and most people would just use those and get on with their day.

Hopefully people would move to Telegram or similar stuff. Rather than locally brewed FB style behemoth. And I sure hope it wouldn't be vkontakte moving in :/

If that'd allow to emerge multiple regional networks that'd be interesting too. Maybe draugiem.lv would make a comeback!

Cool stuff? All I see is old people arguing. No one I know shares any meaningful updates/content regularly on fb who's under 40.

Cool stuff as in politics/influencers/business/entertainment drama.

> Twatter in europe is much smaller than in US. At least in my country all the cool stuff seem to happen on FB.

Where? Eastern Europe? Because where I live it's entirely the opposite.

Take FB from them and they will make noise for a week before they adopt something else.

I suspect it is more likely that they are pressing the US government to repel the law that give them the rights to access any data of non US persons, so they can continue to operate in Europe. After all, it is not in the interests of the US government to have big tech fail in Europe.

So then rather than it being the EU that shrugs its shoulders, it'll be the US that says "meh", and continues on its merry way of surveiling any and all it feels necessary.

"Don't threaten me with a good time!"

I ordered some fireworks just in case

Can you do that in Europe?

Wah you never seen the pics of my hometown, Naples during new years eve? We blow god from the sky

https://youtu.be/FtjMeH7DPbk?t=6

A SEC report is something you quietly (hopping they'll ignore it) tell investors so they can't sue you.

If they were threatening something, they would have made noise about it.

It's easy to say this in the HN bubble where most of us probably don't use Meta's services and dislike what they stand for (walled gardens, pervasive tracking, etc), but in the "real world" Meta's services are still hugely popular in Europe. Depressing as it sounds, EU residents losing access to Facebook and Instagram due to EU regulations would probably materially increase levels of Euroscepticism in certain countries.

That's not to say the EU wouldn't shrug at it anyway. EU institutions are notoriously slow to react to basically anything, which can be both good and bad.

That's probably the bigger difference - if a car factory threatened to leave, it might be able to convince a local authority to grant it planning permission or whatever small thing it was asking for. But expecting the EU to overhaul its flagship privacy regulation to keep your business is a very, very big ask.

(For the record, I don't actually think this is a threat - as others have pointed out, these filings are very conservative when it comes to disclosing potential risks.)

Until some time passes and realize it was a blessing in disguise. I doubt it will happen anytime soon though

> Depressing as it sounds, EU residents losing access to Facebook and Instagram due to EU regulations would probably materially increase levels of Euroscepticism in certain countries.

As much as I'd love to dream that my fellow Europeans could be weaned off the social media poison by a simple court ruling... realistically, they would move to some new EU-based Insta clone in under three months.

My understanding was that in SEC filings companies have to very direct about things like this. Like in the pre IPO filing a lot of companies will say something like "we've lost money the last 3 quarters and it's entirely possible we'll never make any money." That is a true statement that they have to say but surely they don't expect to never make money. I wonder if this statement is like that.

> but surely they don't expect to never make money.

At least for IPO'd companies, you can see if they put their money where their mouth is by looking at what insiders do with their own stock.

http://www.openinsider.com/

Insiders are often very overexposed to a single company because it's their primary form of compensation. You can sell every share you have and still be overexposed due to unvested shares. I would advise against interpreting "I don't want to tie my life savings to this company" as a lack of faith.

Absolutely. But I suppose if you still hold some vested stock, it might mean you are optimistic in spite of the high exposure.

For a global company, Facebook has a surprising uneven distribution of data centers:

  - Continental US: 14 operating or under construction
  - Europe: 3 (all operating)
  - Everywhere else: 1 (Singapore, under construction)

https://datacenters.fb.com

Singapore real estate is so sparse, I'm surprised they even have room for a datacenter of any notable size.

I wonder if it might be because US datacenters are older and were not built to the same scales as newer datacenters.

I can also imagine that the local datacenters are just the equivalent of 'last mile', serving only that which needs to be handled directly, and data is passed asynchronously to the US for larger scale processing and analysis. Makes more sense if they have better (or cheaper) datacenter personnel in the US, or if things like equipment, electricity are cheaper over there.

For last mile they for sure have agreements with ISPs worldwide for collocated boxes similar to Netflix. These should just be hardcore compute.

All three datacenters in Europe is also in Northern Europe and not exactly close to major internet exchanges.

This is mostly for regulatory reasons.

Singapore has very good connectivity for Asia, specially to India, FB's largest market, to China, Japan, Korea and Taiwan.

They were also surprisingly late at building their own datacenters for a company of their size, and ran in colo facilities like 200 Paul Avenue in San Francisco for a very long time.

Oh, yes please. Getting rid of Facebook Messenger and WhatsApp would be such a boon. They are so dominant in Europe that not having them is a serious social handicap, but I stubbornly refuse to let Facebook spy on me, which unfortunately is required to use either.

Let's hope they will. But if I'm not mistaken this isn't the first time they made a hollow promise to leave us alone.

Why would they? Hundreds of millions of people in Europe voluntarily use their products year after year.

A business would be stupid to abandon hundreds of millions of people that want to use their products.

Europe is not using Facebook or Instagram, it runs on WhatsApp. In some big Western European countries WhatsApp is the monopoly messenger for a lot of people (SMS/MMS always was overpriced so people looked for an alternative, and it came about with the Android mass market in the early 2010s). If Facebook would WhatsApp a truly good product (remove telemetry, charge for use, extreme control like in Threema) they might even still have a viable product for our market here. They already got the users. Carrier billing in particular might make this a move that's easier than many think.

The instant WA becomes a paid product is the instant every grandmother jumps ship. And chances are it will be to Telegram, not Signal.

Charging for premium features or business usage could work, though.

Considering Facebook directly lied about the acquisition of Whatsapp I imagine an antitrust lawsuit coming their way which forces them to divest that property

I think this quote is missing some important context. Here's a bit more:

"In August 2020, we received a preliminary draft decision from the Irish Data Protection Commission (IDPC) that preliminarily concluded that Meta Platforms Ireland's reliance on SCCs in respect of European user data does not achieve compliance with the General Data Protection Regulation (GDPR) and preliminarily proposed that such transfers of user data from the European Union to the United States should therefore be suspended. We believe a final decision in this inquiry may issue as early as the first half of 2022. If a new transatlantic data transfer framework is not adopted and we are unable to continue to rely on SCCs or rely upon other alternative means of data transfers from Europe to the United States, we will likely be unable to offer a number of our most significant products and services, including Facebook and Instagram, in Europe, which would materially and adversely affect our business, financial condition, and results of operations."

Lets hope!

yeah!!!

it's 18 years too late!!! XP

Clickable link to download the pdf: https://d18rn0p25nwr6d.cloudfront.net/CIK-0001326801/14039b4...

I doesn't seem likely that they would leave such a large market, but shrug, who knows. I sure hope they will.

Oh they try to "threaten" again? Here is the reaction to their last attempt, Nov 2020: https://news.ycombinator.com/item?id=25184994

Well, they know where the door is, might as well close it on the outside :-)

I agree with other posts that it's unlikely, but hey - they really are good at shooting themselves in the foot. At the moment to comply with laws requiring "account deletion", I suspect they are doing some kind of automated reading of developers/advertisers privacy policies (or having them poorly read by humans) which results in false positives, which would be fine if it were just a first filter. But they're then disabling the apps on that basis, which is insane. This happened to us yesterday:

https://shared-crater-f3a.notion.site/Facebook-is-Breaking-A...

good riddance!

Dammit, beat me to it!

Would be good news and an improvement to our society!

I had to lookup SSC. I think this annual report footnote means that Facebook could be found in non-compliance of GDPR or other regs and could chose to abandon the market rather than pay the fine. Or based on [1] they could apply the EU SSC standards to their businesses outside the EU and be in compliance and continue operations.

https://eur-lex.europa.eu/eli/dec_impl/2021/914/oj?uri=CELEX...

[1] > In order to provide appropriate safeguards, the standard contractual clauses should ensure that the personal data transferred on that basis is afforded a level of protection essentially equivalent to that guaranteed within the Union (10). With a view to ensuring transparency of processing, data subjects should be provided with a copy of the standard contractual clauses and be informed, in particular, of the categories of personal data processed, the right to obtain a copy of the standard contractual clauses, and any onward transfer. Onward transfers by the data importer to a third party in another third country should be allowed only if the third party accedes to the standard contractual clauses, if the continuity of protection is ensured otherwise, or in specific situations, such as on the basis of the explicit, informed consent of the data subject.

Can Meta leave US too, pretty please!!

My IMHO IANAL but having implemented GDPR several times:

Most companies will create European subsidiaries (Facebook, Google Cloud, Amazon AWS, ...) to take the money but fullfilling their obligations. They will not let the money go to someone else.

If you take a look at how Apple bended itself over in China, there is a lot of imagination on what companies are willing to do for the money.

It's not about taking the money. It's about taking your privacy and selling it. When more ways of processing and selling personal data become illegal there's no point for Facebook to continue doing business in the EU unless they want to pivot to a subscription service.

How much money do they earn in Europe?

Q4 2021 revenue by geography:

* $15.826 billion in US/Canada

* $8.357 billion in Europe

* $6.244 billion in Asia/Pacific

* $3.244 billion in Rest of the World

You can view that in their quartely report, as they are a public company: https://investor.fb.com/investor-news/press-release-details/...

- 15,49 dollar per European user

- 48,03 dollar per US user

Where are the privacy regulations the strongest?

That is not only related to privacy regulations. Many European countries are not so consume oriented and have less spare dollars etc.

For example, iPhone market share was still at 26% in Europe. We have different consumer behavior than the US ... and that you can realize in these numbers.

> iPhone market share was still at 26% in Europe

I don't think that's an example at all, I would argue even it is non-sequitur. iPhone just never became "cool" in Europe the same way they did with US teenagers, because in Europe no phone is "cool". Someone buying a $799 Samsung obviously doesn't have less spare money than someone buying a $799 iPhone.

I don't think there are many European teenagers who own an $800 phone of any brand.

And if you have the money AND interest in consume ... You buy an iPhone.

While many do not have the money, many also have no interest spending the money on it.

Privacy regulations no doubt play a role but I would imagine there are other reasons too.

For example, while services in the US can reach the entire country using one language, EU is far more splintered (and not just with respect to language). That is to say, we have way more local services that only target the market within a country. For such services, it's hard to justify as much ad spend as you might if your potential market included hundreds of millions of people.

I imagine Europeans are also more reserved about buying from small vendors in another EU country than Americans would be about buying from another state. I think some EU countries even have a reputation (undeserved or not) for being "sketchy." I've seen lots of sellers who refuse to ship to Italy, for example. I've seen people wondering whether the cheap car part vendors in Estonia, Latvia or Lithuania are trustworthy..

Lucky Europeans!

Oh no! Anyway..

Do people even use Facebook anymore? Who cares? (Serious question)

Lots of people use it.

I know some people who do but they are all losers.

Ah man! Thank god you're so much better than losers.

Ah man! Thank god you're so much better than "losers".

https://www.youtube.com/watch?v=YgSPaXgAdzE

In my circle of IRL friends, they tend not to use facebook.com but still use Facebook Messenger (esp for group chats) and instagram.

EDIT: My Neigbhours still use facebook.com for news and questions about the neighbourbood (Or so I'm led to believe from them, not sure what the actual percentage of the neighbours actually use it.)

Recall that N. American is about 4% of the world and that Facebook is the Internet to more people than there are Americans.

Nobody uses it anymore, there are too many people on it.

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