How much should we care about the Facebook 'fiasco'?

The Facebook fiasco. “Shame if you missed it” tweeted billionaire investor Jim Mellon on Monday, talking about the weekend trading idea of shorting Facebook. That was when news started breaking about Cambridge Analytica, the British company that harvested data from the Facebook profiles of more than 50m individuals.

Consequently, Facebook’s value dropped by $37bn in one day – almost as much as it made in ad revenues in 2017. By the end of day two (Tuesday), it was down $60bn – more than the market cap of Tesla. And #DeleteFacebook started trending across social media.

How much do we care? If Google Trends is anything to go by then a lot of people (in the West, where Facebook is a disposable luxury and not a proxy internet) are deleting their accounts. But is that because they don’t like their data being used, or because they don’t like what they think it was used for – Trump’s election, etc etc? We spread our data far and wide because doing so gives us access to products and services that improve our lives. The advent of GDPR (effective from 25 May) is touted as heralding the era of permission-based data-use. In reality, you’ll have a couple of extra clicks to make before you can access something.

What is Facebook’s future? This millennial mass migration (it’s suddenly become uncool to be on Facebook) could be a boon for other social media platforms. But with the company possibly facing fines of up to $2 trillion, the episode could ultimately spell existential disaster for the swathes of tech titans either owned by Facebook, or that rely on it to reach and retain users.

Here’s an interesting piece from economist Tyler Cowen on how people are trying to “re-establish the feeling of control”.