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Today's Cache | Facebook needs a shrink

Today’s Cache dissects big themes at the intersection of technology, business and policy. Written by John Xavier, tech news lead at The Hindu

Facebook is overwhelmed, and has reached out for help

Facebook’s problems have compounded in recent times. The infamous 2018 Cambridge Analytica scandal opened the door for regulators to swoop down on the company.

U.S. lawmakers called CEO Mark Zuckerberg to testify before Congress on how his firm protects users’ information. U.K.’s parliamentary committee summoned Zuckerberg, and the head of European parliament said they would carry out a separate investigation into the matter.

The fallout from the data scandal made the king of social media put its house in order. CTO Mike Shroepfer tweaked the company’s policies around user data management. And Zuckerberg took responsibility for Facebook’s shortcomings. Their actions didn’t stop legislators from further pursuing the social network.

\ | Photo Credit: Reuters

 

The company’s alleged anticompetitive practices were brought under the scanner by U.S. lawmakers last year. They questioned Zuckerberg over his company’s decision to buy Instagram. The purchase was seen as a pre-emptive move to keep competition at bay.

In another development, former U.S. President Donald Trump signed an executive order curtailing Section 230 of the U.S. Communications Decency Act. The Section protects social media platforms like Facebook and Twitter from being liable for content their users post.

Most recently, a series of reports by the Wall Street Journal once again put the social media firm under spotlight. The report details how Facebook runs a privilege-based system that exempts certain users from following its policies. In another revelation, the report points out how Facebook knew Instagram was toxic for many teen girls and yet played down its effects.

The WSJ report comes at a time when Facebook executives are due to face U.S. lawmakers over an issue with Instagram’s plan to build an app for teenagers. In an effort to turn down the heat, Instagram CEO Adam Mosseri told NBC that the company would suspend plans for a version of the app tailored to teens.

The company’s woes reflect on its stock price. Shares of Facebook were off 3% as of 10 a.m. U.S. (eastern time) trading Tuesday. That may not sound much, but for a trillion-dollar company, it’s a $30 billion drop.

The multitude of events has pushed Facebook to get advice. And the social network has reached out to the its Oversight Board for guidance on how it should use its cross-check system.

“We know the system isn’t perfect,” Nick Clegg, Facebook’s head of global affairs, said in a blog post. “We have new teams and resources in place, and we are continuing to make improvements. But more are needed. The Oversight Board’s recommendations will be a big part of this continued work.”

Clegg specifically wants the advisory board to share its opinion on the cross-check system: whether Facebook should keep or scrap it. Now, the ball is in the shrink’s court.

 

(This column was emailed on September 29.)

 

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