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Facebook's Privacy Crisis Is Also Its Opportunity

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You can set your watch by it: After sudden success comes a backlash, and right now, Facebook is getting backlash from all sides. Privacy advocates are attacking the company. Regulators in the U.S. and abroad are asking questions or openly criticizing it. Some users are considering canceling their accounts while others (like me) have stripped their profiles of data and grown cautious about their updates.

But every crisis brings an opportunity. Facebook can emerge from the privacy brouhaha it started a lot stronger than it was before it began. Of course, it won’t be easy and if Facebook fumbles, it will almost surely emerge a lot weaker.

A lack of nuance

The controversy is pushing Facebook into the middle of an unpleasant and messy conversation that has needed to take place ever since the social web began to mature nearly a decade ago. Right now, the debate is about privacy protection but at its heart it’s also about discretion and the freedom to exercise that discretion whenever we choose.

In the world beyond the web we habitually show different sides of ourselves in different situations. But the current structure of the web doesn’t allow for any nuance. Offhand comments can be preserved for decades, to be repeated again and again. Random actions can be tracked by advertisers, and shape how they respond to you. Managing your online persona involves forethought, perseverance and sometimes hard lessons. Right now, the social web is designed as if you have only one identity, when in fact we all have complex and sometimes contradictory aspects to ourselves. Some people thrive in this environment, but for most there’s a learning curve ahead.

Facebook, with its Open Graph, ignored this learning curve, just as it did with Beacon a few years ago. And so it has stumbled right into the thick of this thorny debate of how we manage ourselves online. But precisely because of the company’s central position, it’s ideally positioned to find a way to solve it, and ultimately to profit from it. It has a chance to lead a long-term effort to clarify the privacy issue, and design a broadly accepted social network that can accommodate some of the complexities of human nature.

A broader challenge

But will Facebook seize that opportunity? It’s not looking good. The company held an all-hands meeting last week to discuss privacy protections, but it wants to keep the details of that discussion private. Its insistence that users love the new changes also rings false. Most users are divided between tolerating the changes or being uneasy about features that benefit Facebook and its partners while offering little value to users themselves. There are already plenty of people who have chosen to remain absent from Facebook and social networks in general. Open Graph threatens to add more people to that publicity-shy camp. Instead of becoming ubiquitous on the web, Facebook risks becoming useful to an increasingly smaller portion of the web’s population.

Emerging from its current crisis will be painful. Facebook needs to capitulate, if not to its loudest critics, than to the concerns of its everyday users. For most people, 50 different privacy settings is 49 too many. To appeal to the widest audience as possible, default settings need to keep all user data restricted to users’ friends. The challenge to engineers is then to make customizing privacy controls as intuitive and welcoming as possible. The broader challenge for Facebook’s leadership is to entice us into voluntarily offering more personal information to the web at large.

Some of us are already sharing our lives to the web at large, while many of us never will. But what we all have in common is that the decision of where to draw the line between our public and our private selves belongs to us, and no one else. Honoring that principle will mean Facebook forgoes short-term revenue. But over the long term it’s the surest way for Facebook to reach its potential.

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20 Responses to “Facebook's Privacy Crisis Is Also Its Opportunity”

  1. Yup – almost all personal information I have in FB is now bunkum. And I now randomly and arbitrarily LIKE things that have nothing to do with me just to gunk up the works. I havent left FB yet; but I have scaled back my usage of it considerably.

    FB blinked – and skrewed up bad. They were marketing a service – a somewhat private room to engage in inane banter with friends who are out of reach by time or space — and then FB took that away. Well that was kinda dumb.

  2. Absolutely Franz!

    Personally, I also don’t buy the advertising thing. To me most ads on Facebook look cheap to me and as for pages which are either brand managed, fake or imho raped from equally falsely led contributors to Wikipedia, they look pretty ordinary adjacent to a bunch of grafitti of user-generated content. Show me the same product within an elegant print environment like Vanity Fair or Vogue or in a primetime TV slot and perhaps on an iPad, and I still feel good about it. The trick/ holy grail, is getting brands as part of the ‘conversation’ but here’s where FB are coming unstuck… Firstly, they can’t own the conversation and manipulate it, they just provide the platform for where it takes place. Secondly and more importantly, I also passionately believe that for any sophisticated and established brand they have to consider one fundamental problem with this new world order; namely:- ‘if they want to stand out from the crowd, they can’t become part of it!’

    Robert Scoble has recently alluded to the issue too and effectively echoed what I’ve been saying for some time; that Facebook is a Chris Anderson ‘Long Tail’ or the 80% of the 80:20 rule. The rich and elegant ‘HEAD’ or 20% is actually outside the platform and is the place where trad media finally converges properly online. This hasn’t happened yet, which is why people like Martin Sorrel at WPP still have a certain disdain for Social Networking in it’s current guise. (and he’s one of the ad world guys really writing the big cheques…)

    Facebook have created a PR catastrophe recently on privacy and if it weren’t for their scale, I think it would have been one of the all time great own goals. They still could prevail as you suggest, but certainly not on the current path they are travelling and probably not unless they eat some humble pie too.

    I see Facebook’s only route being to accept that it has become inadvertantly another ubiquitious utility like the telephone which carries our private conversations in a new fashion. We would no more expect adverts in our telephone calls than we aren’t actually irritated by Facebook ones now and more importantly, we would certainly be incandescent if telephone networks started making our conversations public without permission so as to allow publishers to sell to us during our calls. So Facebook should in my view work to a freemium model and work with the owners of the conversation, perhaps by sharing revenues, then maybe we would be more inclined to open up. Sticking FB flags on content territory and privacy without asking and on the assumption you can then remove them if you want is colonisation of our data and privacy and inherently immoral. I would myself pay a modest fee for an advert free arena to connect socially with people I like. If you then think of them as say a service provider/ ISP, they would have 500 nillion potential monthly billable Clients and wouldn’t need to p**s people off. If they want to utilise my private data from there then they can treat me with some respect and negotiate accordingly…

    I assume though at the end of the day, Facebook is ruthlessly tunnel visioned on a sale to Microsoft or IPO and Mark Z is by all accounts only concerned with us DF’s if we get in the way of that goal.

    Most importantly, here’s a question for you Gigaom! If Facebook is advocating universal privacy, why can’t we have sight of their absolute numbers? Or put another way, if Santiago’s life (privacy metaphor) wasn’t in any danger, then why did he need to be transfered off the base?

  3. Franz

    Facebook isn’t interested in some wider debate about privacy on the internet, they’re anxious to find a cash cow of the magnitude of adsense, so that they can go ahead with IPO. Right now, they think the only way they can do this is to force everyone make their profiles and “likes” public. Don’t kid yourself into thinking their disregard for your privacy is due to ignorance of people’s concerns or over enthusiasm about sharing and social networking. Zuckerberg’s facebook profile is empty, he cares about privacy, he thinks you people are dumb fucks who don’t know the value of your personal data.

    • It may take a while, but he’ll eventually screw up badly enough to knock himself out.

      Maybe he’ll get caught stalking some underaged Facebooker. Maybe he’ll greet some DST limited in pajamas (wouldn’t you love to be there when he tries to explain to DST how power flows from the end of of a voting share?), or maybe the EU will become interested enough to start legislating away Facebook’s business plan.

      His pattern of mistakes is too consistent. Sooner or later he’ll take it too far.

  4. The point is this isn’t Facebook’s first brush with Privacy feedback. They push as far as they can, take the PR hits from privacy activists and pull back just enough.

    Months later they do it again, and again…

    They know what they should do and what the “right” thing to do is… and they are not doing it.