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Monday, March 19, 2018

Facebook: failure or fraud?

It's fascinating to see that after all the ways that Big Social is spying on everyone, what has the media in an uproar is the belated realization that a sword can always cut two ways. They didn't mind when they knew it was the Obama, Hillary, and the SJW-converged corporations that were data-mining, but now that they realize the Right - and in particular, Steve Bannon and Donald Trump - can and have done exactly the same thing, they suddenly have reservations about the wisdom of letting organizations have access to that level of data.
Facebook is facing an existential test, and its leadership is failing to address it.

Good leaders admit mistakes, apologize quickly, show up where they're needed and show their belief in the company by keeping skin in the game.

Facebook executives, in contrast, react to negative news with spin and attempts to bury it. Throughout the last year, every time bad news has broken, executives have downplayed its significance. Look at its public statements last year about how many people had seen Russian-bought election ads — first it was 10 million, then it was 126 million.

Top execs dodged Congress when it was asking questions about Russian interference. They are selling their shares at a record clip.

The actions of Facebook execs now recall how execs at Nokia and Blackberry reacted after the iPhone emerged. Their revenues kept growing for a couple years -- and they dismissed the threats. By the time users started leaving in droves, it was too late.

There's no outside attacker bringing Facebook down. It's a circular firing squad that stems from the company's fundamental business model of collecting data from users, and using that data to sell targeted ads. For years, users went along with the bargain. But after almost a year of constant negative publicity, their patience may be waning.

Facebook did not initially respond to questions or a request for comment from CNBC.
Here is a less generous theory. We know that Facebook was being propped up by the CIA from the start. But the CIA is now under the control of the God-Emperor. Which means that a) Facebook's dirty laundry is more likely to come out, and, b) Facebook is not going to be financially propped up the way it has been from the very beginning.

Which, of course, raises the interesting question about whether it ever was a viable business at all. Or even a legal one.
Facebook may face more legal trouble than you might think in the wake of Cambridge Analytica's large-scale data harvesting. Former US officials David Vladeck and Jessica Rich have told the Washington Post that Facebook's data sharing may violate the FTC consent decree requiring that it both ask for permission before sharing data and report any authorized access. The "Thisisyourdigitallife" app at the heart of the affair asked for permission from those who directly used it, but not the millions of Facebook friends whose data was taken in the process.

If the FTC did find violations, Facebook could be on the hook for some very hefty fines -- albeit fines that aren't likely to be as hefty as possible. The decree asks for fines as large as $40,000 per person, but that would amount to roughly $2 trillion. Regulators like the FTC historically push for fines they know companies can pay, which would suggest fines that are 'just' in the billion-dollar range. Given that there are already multiple American and European investigations underway, any financial penalty would be just one piece of a larger puzzle.
Would you not just love to see Facebook hit with a $2 trillion fine?

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50 Comments:

Blogger Joeplanet March 19, 2018 9:40 AM  

Facebook dalenda est

Blogger peppermint88 March 19, 2018 9:41 AM  

It said it was a place for friends, but all social media ever was is a place for memes

Blogger The Kurgan March 19, 2018 9:44 AM  

Google too was funded from the start by the CIA , as is quite thoroughly documented.
I’d say the level of truman’s World zeitgeist is high

Blogger VD March 19, 2018 9:49 AM  

I was always suspicious of Microsoft's initial investment in Facebook. They didn't give them that much money, but they took so little ownership that it priced Facebook at an absurd market value. That struck me as a setup.

Blogger Harambe March 19, 2018 9:51 AM  

So I should start building an alt-social media platform?

Blogger dienw March 19, 2018 9:51 AM  


Along the same line via Instapundit:
Facebook may face more legal trouble than you might think in the wake of Cambridge Analytica's large-scale data harvesting. Former US officials David Vladeck and Jessica Rich have told the Washington Post that Facebook's data sharing may violate the FTC consent decree requiring that it both ask for permission before sharing data and report any authorized access. The "Thisisyourdigitallife" app at the heart of the affair asked for permission from those who directly used it, but not the millions of Facebook friends whose data was taken in the process.

Blogger Johnny Philosopher March 19, 2018 9:56 AM  

Interesting. I didn’t know about the CIA funding. Is this common knowledge that I missed?

Blogger Looking Glass March 19, 2018 10:00 AM  

Facebook, and Google, weren't value-adds to their industries and never have been. Thus, they've only ever profited by running other competitors, in related markets, either to lower margins or out of the industry all together. They're profitable because of the market share they've captured, but their model wasn't ever sustainable until they achieved such saturation as to be ubiquitous.

Facebook is more interesting than Google, in the regards to the support. After Excite turned down buying Google and they actually went about getting funding, Google was just simply a better product. Facebook is questionable. Then you have Zuckerberg taking control, then you have their issues with funding at critical times.

I think it's safe to say that "The Social Network", with was a book & movie, acted very much to cover up certain details. A "negative" hagiography is just what "They" can use. It establishes a narrative that can't be broken, while covering up actual details. You see this in any government investigation that deals with government screw ups.

@7 Johnny Philosopher

In-Q-Tel. It's the CIA's hedge fund. They have a webpage.


As for the 2nd story, Cambridge Analytica is under the Mercers. Some of this is just blow-back from helping Trump win, though it would be fitting to use their work as a vehicle to attack Facebook.

Actually, it would be a brilliant, Trumpian vehicle to attack Facebook and Google. Things that make you go, "hmm...".

Blogger Lazarus March 19, 2018 10:01 AM  

Anti-School's class action lawsuit

MOTION TO REINSTATE VIRTUAL PROPERTY

UNITED STATES DISTRICT COURT

Concord, NH



District of Merrimack NH Docket # 18-CV-203-PB





Isaac Green

v.



YouTube, Facebook Twitter, Google, Blogspot.com, Patreon, and GoFundMe

Defendants


Blogger The Chortling March 19, 2018 10:01 AM  

>>Would you not just love to see Facebook hit with a $2 trillion fine?<<

I think the merchants of the earth would weep and mourn because no one would buy their merchandise any more...

(or at least it will be positioned as an economic catastropha "such as the world has never seen")

Blogger Resident Moron™ March 19, 2018 10:03 AM  

Oracle, too, was started with CIA money.

Name a significant tech company and try to defend the notion it isn’t riddled with spooks - it’s impossible.

As for the headline; fraud and failure are not mutually exclusive, are they?

Blogger FUBARwest March 19, 2018 10:05 AM  

My baseline belief is the government can't do anything efficiently or effectively that a private business can't do better but hearing the CIA is funding Google and Facebook(isn't this illegal btw? I thought the CIA can't operate here in the USA) makes me wonder.

If the only way these social media sites exist is through funding from the government is it even possible for a private company to run one and break even?

Blogger Long Live The West March 19, 2018 10:07 AM  

#7

I'd never heard of this either. But I can't exactly say I'm surprised to find out the CIA was funding a service that encourages people to put their info where they can see it. Don't worry though, they're only doing it so they can stop people like Nikolas Cruz... Oh Wait.

Blogger Looking Glass March 19, 2018 10:10 AM  

@11 Resident Moron™

NSA pays people to work at certain tech companies. This has been true since the 1960s.

Now, some of this makes dang logical sense, but the problem is corruption at the top & the use of all of this tech on citizens in intentional ways.

Blogger The Kurgan March 19, 2018 10:11 AM  

FUBARWest
No. I don’t believe it is.

Blogger Salt March 19, 2018 10:13 AM  

FB might try and pay it in Bitcoin.

Blogger Doug Cranmer March 19, 2018 10:24 AM  

It's not in the MSM but yes, it's common knowledge. Google around and it becomes clear.

Blogger pyrrhus March 19, 2018 10:32 AM  

Facebook has other problems. The main one being that it isn't really profitable... It is primarily used by people over 40, and in my experience no one pays any attention to the ads...But FB has been repeatedly caught charging Bot clicks to advertisers. ..As the Boomers die off.....so will FB. Remember MySpace?

Blogger Cataline Sergius March 19, 2018 10:37 AM  

This comment has been removed by the author.

Blogger Cataline Sergius March 19, 2018 10:38 AM  

@18 pyrrhus

Facebook ads can be effective BUT you gotta hire someone to run them for you and that isn't cheap. In fact the price of the service running the ads for you can easily outweigh the revenue it generates if you are a small fry.

That said, it's still better than Adsense.

Blogger kurt9 March 19, 2018 10:48 AM  

Google too. The CIA props up Facebook and the NSA props up Google.

Blogger Stilicho March 19, 2018 10:56 AM  

Look, we've known for years that Facebook would eventually devolve to nothing more than a bunch of post-wall cat ladies posting pictures of their feline friends and bemoaning the patriarchy. It's only a question of when. Cat food/cat toy manufacturers should be advertising there. Others, not so much.

Blogger OGRE March 19, 2018 10:58 AM  

FUBARwest wrote:My baseline belief is the government can't do anything efficiently or effectively that a private business can't do better


While thats a pretty reasonable assumption to maintain, you're mistaking these large publicly traded corporations for private businesses. Its an exceptionally common mistake. But these corporations are creatures of government, existing as a legal entity solely because some state says so. All the benefits, rights, duties, and obligations that a corporation has that an individual (or a partnership) does not, it has because the government gave them to it.

I'd also add that publicly traded corporations are subject to many of the same things that cause inefficiencies in state organizations...represenative 'democracy' that is hardly representative, a separation of ownership rights from the ability to exercise control, built in incentives for management to act in their own best interest rather than those of the shareholders or employees or customers. Really when you look at how a public corporation is organized and operates it is very much the same as how a government is organized and operates--except a corporation cannot claim a monopoly on violence.

Point being, all the things that make a government inefficient pretty much applies to publicly traded corporations. So theres no sense in trusting in a corporation over the state. (This doesn't so much apply to closely held corporations, where all or most of the shareholders are involved in the actual running of the business.)

Blogger The Anti-Gnostic March 19, 2018 10:59 AM  

@18 - Facebook has other problems. The main one being that it isn't really profitable... It is primarily used by people over 40, and in my experience no one pays any attention to the ads...But FB has been repeatedly caught charging Bot clicks to advertisers. ..As the Boomers die off.....so will FB. Remember MySpace?

I don't get the whole business. The fact that a wasteful bot and click-bait industry evolved to skim profits always struck me as weird and dysfunctional. To the extent Zuckerberg may have any old-fashioned business sense (doubtful, but maybe), he probably thinks wistfully about the good old days when he was arguing with his partner about schlepping local businesses.

The Social Network made a very big deal over Zuck's obsession with being "cool" and "free" but those days are apparently long gone. Facebook is a very cluttered, un-cool site.

FB trades at 34 times earnings. Alphabet (GOOG) is almost 62. The market is apparently banking on an awful lot of greater-fools.

Blogger Crush Limbraw March 19, 2018 11:08 AM  

If anyone wants to read more on the history of Facebook and CIA - https://crushlimbraw.blogspot.com/search?q=Facebook+cia&max-results=20&by-date=false&m=0 - most are from Lew Rockwell - I just collected them about a year ago.

Blogger tuberman March 19, 2018 11:21 AM  

8. Looking Glass,

One just assumes that almost all Tech in the Valley and other places is at least partly started by 3 letter agency money, and after that they were money assisted to keep competitors away, and to keep their usefulness to the agencies going.

Facebook is relatively unimportant, except as a sign of the new directions. No FB account for me, and never will be. Zuck is so disgusting, he is like Trudeau, contempt takes over before hate can set into place. If he and his wife have any business sense, it involves selling body parts and not FB.

-----------------------

A recent term that goes beyond Deep State, and is more specific is SES Or Senior Executive Services

See this Youtube from a few days ago:
The Untouchables on YT American Intelligence Media

Shows some more specific detail of how it all works. These people are all interwoven with the agencies and work in the agencies themselves, all government institutions, and all the large companies.

Blogger Guitar Man March 19, 2018 11:41 AM  

Let it burn.

Blogger Resident Moron™ March 19, 2018 11:49 AM  

Too passive.

Burn it!

Blogger James Dixon March 19, 2018 12:09 PM  

> If the only way these social media sites exist is through funding from the government is it even possible for a private company to run one and break even?

Probably not.

> Would you not just love to see Facebook hit with a $2 trillion fine?

Oh, definitely. But I think even a $1B fine would be enough to trigger shareholder suits and possibly get the SEC involved. Something about a CEO's Sarbanes Oxley responsibilities wrt accounting seems like it might be applicable.

Blogger Azure Amaranthine March 19, 2018 12:17 PM  

"It is primarily used by people over 40"

Now there's an interesting observation. It makes sense when you think about how much older people and retired people like to communicate with their relatives.

So, Facebook is the ascended form of Grandma calling everyone constantly on the phone? Sound about right.

Blogger tuberman March 19, 2018 12:19 PM  

The Social Media Barons are/were just the worst of all of this, and as most know Eric Schmidt was the center around their organized attempts to help HRC during election.

What's being discovered now is that the SES (Deep State) is involved everywhere, and they are planned sabotage of everything pro-American. pro-West, and they destroy systematically any attempts to do good, especially by leaders of government or industry. The least of these people have pay checks, paid by the tax payer, that is more than the VP of the USA.

Blogger Jack Amok March 19, 2018 12:22 PM  

FB trades at 34 times earnings. Alphabet (GOOG) is almost 62. The market is apparently banking on an awful lot of greater-fools.

All the funny-money the Fed has been creating has to go somewhere. Some of it has gone into real estate prices, some into the stock market.

Facebook has other problems. The main one being that it isn't really profitable

Yeah. In the spirit of building our own platforms, I've been trying to figure out a viable business model for a FB competitor, and it's thin gruel unless you are selling data collection. Both FB and Google are nominally supported by ads, but advertising is in bad shape. Advertisers flocked to Google and FB when their previous main channels (TV/cable, radio, print) started dying due to on-demand/on-line eating their lunch. But it's temporary.

Blogger Jack Amok March 19, 2018 12:33 PM  

The fact that a wasteful bot and click-bait industry evolved to skim profits always struck me as weird and dysfunctional.

Not when you start from the old-fashioned advertising industry, with the quote from John Wanamaker (the guy who invented department stores) "half the money I spend on advertising is wasted, I just don't know which half."

Pay-per-click was supposed to solve that problem - it was supposed to give advertisers a way to figure out which half was wasted and which wasn't. The irony is that not only did it fail, I think maybe it proved that "half is wasted" is more like "95% is wasted".



Blogger tuberman March 19, 2018 12:34 PM  

Doubt if the truth about the CIA will ever fully come to light, but no one controls the CIA, although people can influence the CIA with bribes, and giving them more power.

The portion of the CIA now controlled by Trump is small to the point of not even significant.

The answer to the CIA is to smash it, destroy it completely, as it has been rogue since the OSS days.

Blogger Looking Glass March 19, 2018 12:39 PM  

@32 Jack Amok

"Freemium" is the only Internet model that's shown to consistently work. Let's you split Ads + Paid without harsh Paywalls. It also has a much better Feedback Loop requirement, along with wanting you to actively prevent Bot Spamming.


@26 tuberman

The 3-Letters tend to get involved via proxies at the Angel Funding stage. There's logical & legitimate reasons for this that aren't nefarious, but the acts have become so evil that no one can trust them.

Blogger tuberman March 19, 2018 12:53 PM  

35. LG,

Yet it is much more than the original "Angel Funding," as who put people like Zuck in place? He did not come up with most of the tech that allowed FB to happen quickly. Misused patents, illegal use sometimes, or stolen. Money continues to flow in at critical times from organizations like Loop Capital from BHO home town, Chicago. Money skimmed and scammed from other places.

It's hard to keep track of all this interwoven corruption, which is why it works.

Blogger CM March 19, 2018 12:57 PM  

Facebook, and Google, weren't value-adds to their industries and never have been. Thus, they've only ever profited by running other competitors, in related markets, either to lower margins or out of the industry all together. They're profitable because of the market share they've captured, but their model wasn't ever sustainable until they achieved such saturation as to be ubiquitous.

This has to be related to why it's so hard to get a start-up that can compete with them.

Blogger YIH March 19, 2018 1:18 PM  

The Kurgan wrote:Google too was funded from the start by the CIA , as is quite thoroughly documented.

I’d say the level of truman’s World zeitgeist is high

I've believed for some time that Google is merely the public face of the NSA. While it's offices and some operations are in San Fran, where it really resides is in Utah.
In '99 Page and Brin wanted to be rid of Google, in fact:
Early in 1999, Brin and Page decided they wanted to sell Google to Excite. They went to Excite CEO George Bell and offered to sell it to him for $1 million. He rejected the offer. Vinod Khosla, one of Excite's venture capitalists, talked the duo down to $750,000, but Bell still rejected it.[36] 'Member Excite? One of the biggest of the ''tech wrecks''. Part of the reason for the 'tech wreck' that killed so many startups was the server and high-speed data lines at that lines at that time (as in mega costly). Brin and Page wanted to finish college and get on with their lives and wanted to free themselves from the operating costs and burden of the growing Google. After Excite turned them down, my guess is someone who had plenty of server space and high speed data lines to spare and were willing to pay a nice salary to Brin and Page to keep what was already becoming the dominant search engine (and all the juicy data) going. I think you know who I'm talking about - after all, really, who was the internet built for in the first place?
With faceberg, again it was the government picking a social media platform who had just as much scruples as they did.

Blogger Azure Amaranthine March 19, 2018 1:25 PM  

"after all, really, who was the internet built for in the first place"

The military, research institutions, and spy agencies. Probably not in that order.

Blogger dienw March 19, 2018 1:31 PM  

@26 tuberman
thanks, that video and the newer one were very informative: we now know the specifics of the deep state; it is the Senior Executive Services which is spread throughout the government agencies and which Obama used to create his shadow government.

Blogger tuberman March 19, 2018 1:50 PM  

dienw wrote:@26 tuberman

thanks, that video and the newer one were very informative: we now know the specifics of the deep state; it is the Senior Executive Services which is spread throughout the government agencies and which Obama used to create his shadow government.


Yes, these are great summaries from YT. I first heard about SES around 9-10 days ago, then looked for a tight summary, and these are the best so far.

Blogger Lamarck Leland March 19, 2018 2:00 PM  

Harambe wrote:So I should start building an alt-social media platform?

In Brazil there was a Christian Facebook.
I'm not sure if it worked because they were extremely sanctimonious but I don't think it was a bad idea at all

Blogger DonReynolds March 19, 2018 2:21 PM  

President Donald Trump is not a meter maid checking parking meters. In short, he is less than interested in collecting fines from the corporations that openly oppose him than Obama proved to be. Obama was keen on financial punishment. To him, it was the domestic equivalent of drone strikes in foreign countries. Corporate fines and drone strikes were relatively cheap, easy, sometimes hit the right target, and made lots of cheap news copy. In short, only the "bad guys" got hurt (usually).

President Trump does not want Facebook to give up their money nor does he want them destroyed. But that potential (for large financial penalties) is very likely to push Facebook to be a little more even-handed and if that does not make them a friend and ally, it certainly will compel them to be more neutral and objective. (When you got them by the gonads, their hearts and minds soon follow.)

If President Trump needed money....say, to build a wall....he could easily collect that money with money fines PAID by the people who make the wall necessary and who legally have owed the penalty for many years.....illegal aliens, those who employ illegal aliens, sanctuary cities and states, and the government of Mexico. These are the people who SHOULD pay fines (since they are already lawful and no action is required by Congress), and it is ONLY because of them that the wall is necessary for the security and safety of American citizens.

Blogger AnvilTiger March 19, 2018 2:27 PM  

Gen Z is all in on Instagram. Almost zero of them do Facebook.

Blogger Looking Glass March 19, 2018 2:36 PM  

@37 CM

Technically, there's also anti-competitive practices. Facebook is the world's largest Image Hosting service, as well, though that did make sense from their business position.

The place to note where they've been "brought in" is during a big ramp in either their funding or their stock. Amazon seemed to have been on the outside of most of this for a long while, but that changed about the time Bezos hit the gym.

Blogger SciVo March 19, 2018 2:41 PM  

I swear, every time I see his name now, I remember Zuckerberg's road trip through Texas. It really sticks with you. It's sticky...so to speak.

Blogger ReluctantMessiah March 19, 2018 4:33 PM  

https://ijr.com/2018/03/1077083-ex-obama-campaign-director-fb/

Vox, it gets better.

"A former Obama campaign official is claiming that Facebook knowingly allowed them to mine massive amounts of Facebook data — more than they would’ve allowed someone else to do — because they were supportive of the campaign."

Blogger LP999-16 March 19, 2018 5:12 PM  

Would you not just love to see Facebook hit with a $2 trillion fine?

My wish for Lent. Was it reported that the gov't is sending classified materials to Amamzon's cloud? So perhaps the POTUS also wished to probed around Amazon like FB. If we enter a comment at FB then edit or erase it FB owns that.

Dear Mr. POTUS unmask FACEBOOK!

Blogger LP999-16 March 19, 2018 5:22 PM  

GETUS doesn't like competition or twerps with god complexes, since Marky owns the country? Trump has taken notice to FB.

Please keep MZ away from children and pets; so alarming of a link, thanks sci.https://me.me/i/mark-zuckerberg-23-minutes-ago-driving-though-texas-has-18844190

Blogger SciVo March 19, 2018 11:49 PM  

One assumes that it's a parody...but it's still creepy, because you realize that you could totally picture him doing and thinking that.

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