[Editor's note: The IPO may be over, but millions are still wondering whether they should buy this high priced stock. Our eBook "Buy This Book Before You Buy Facebook" is still the most relevant source of information out there for those who haven't watched the company every day for the last eight years. While Facebook has been an unequivocal success, there is one issue that has dogged it for most of its life: Privacy.
Because we felt that those of us in the Valley are probably too close to the company to view this issue objectively, we asked Adam Penenberg to write it. Penenberg is a journalism professor at NYU and one of the most known commentators on privacy and ethics-- going back to the days when he outed Stephen Glass.
The following is an excerpt from his chapter.]
Facebook logs every word you type, copies every photo you upload and every video you watch, and stores every song you hear. It notes every comment, counts every ‘like,’ collates every interest, transcribes every message, eavesdrops on every chat, tallies every click. If Facebook were a song, it might go like this (with apologies to Sting): “Every pic you take. And every post you make. Every tag you break, every like you take, I’ll be watching you…” Facebook approves every friend and while it’s at it recommends others it thinks you should know. It data mines what Mark Zuckerberg calls the “social graph,” the graphical representation of your relationships – family, friends, colleagues, acquaintances and strangers from the present and the past, brought together in one digital place and connected by blood, work, school or common interest.
Facebook does all this for one simple reason: so it can match you with the perfect advertisement. Because when you get down to it, Facebook wants to sell you shit. Or more accurately, it wants to serve you ads so that someone who pays for advertising can sell you shit. Optimally, perhaps ultimately, it wants to sell you shit before you even know you want it. At that point, Facebook will know you better than you know yourself.
And if you don’t like it? Well, you can leave. But if you’re like most people you won’t. There have been times over its eight-year-history that pundits and soothsayers have forecast Facebook’s inevitable decline. In August 2009 Virginia Heffernan penned a widely read column in The New York Times headlined “Facebook Exodus,” in which she interviewed a smattering of folks who had departed Facebook. It was a trend story that perfectly reflected that old journalism saying: “Three’s a trend. Four’s a veritable movement.” She wrote: “Is Facebook doomed to someday become an online ghost town, run by zombie users who never update their pages and packs of marketers picking at the corpses of social circles they once hoped to exploit? Sad, if so. Though maybe fated, like the demise of a college clique.”
Yet each person she cited by name has in the intervening years returned to Facebook – or, perhaps even more telling, has been supplanted by people with identical names – and Heffernan herself is active on Facebook. At any rate, she published her commentary several hundred million users ago, when the house that Zuck built counted roughly 200 million users. Today, the eve before Facebook goes public with a massive $100 billion initial public offering, it counts close to a billion users (160 million of them in the United States) with half a billion of them logging in every day.
Facebook is hardly alone in putting you under the proverbial microscope. Google is also notorious for this. It scans every Gmail you send and receive, it studies your search history, it has even been accused of illicitly intercepting residents’ Internet traffic during drive-bys in compiling photos for Google’s Street View. Apple’s iPhone reports back to the home office all of the conversations you’ve had with Siri, which is designed to learn from the experiences.
But let’s not limit ourselves to tech’s big three. Dig into your browser settings and check your cookies, those itty-bitty bits of software that inform a website you’ve been there before or track your clicks from site to site. If you aren’t blocking or regularly expunging them, which would make traversing the Web a slow, bumpy ride at best, you’re being followed. As I write this, there are more than 2,000 cookies tucked away in my Safari browser. Virtually every website I’ve visited in recent months is listed. I see that I clicked to Apple Insider, Ars Technica, AT&T, and those are just a few of the As. These kinds of cookies help websites load faster and count the number of visitors. But others in my cache are designed to track each Web page I hit, identifying me to marketers who have likely compiled fairly extensive dossiers on me. Not the kind of dossier a CIA case officer would produce. Mine (and yours) probably don’t even list our names. We’re simply a number that can be cross-referenced with each webpage we’ve skimmed, the books, sex toys and brands of tennis balls we’ve bought, or the ads we’ve clicked on. In my cache these cookies are tossed out by marketers like AdBrite, AdBlade, Ad Elixir, Ad Juggler, Brand-Server, Da-Tracking and the like.
We’re all vulnerable to having our privacy invaded, which happens every time you bounce from the Huffington Post to Amazon to Facebook, but you don’t often hear many people complaining. Most seem blissfully unaware that their likes, dislikes and purchases end up in somebody else’s hands, probably because they don’t hear about it, as if someone were whispering an insult or snide observation about you behind your back. But here’s where Facebook is different.
People spend far more time on Facebook than elsewhere online, and it is more upfront about tracking all your actions. If you update your status — tell your friends “what’s on your mind” as the Facebook prompt goes — and type “I am addicted to profiteroles and 18-year-old scotch (they’re great if you dunk ‘em)” you might suddenly encounter ads for cookbooks, Martha Stewart recipes, and bartending schools. Google does things like this, too, but then Facebook ups the ante. Even if you don’t type the words yourself, Facebook is still learning about you. Recently someone tagged me in a post about a column I had written about startups that “pivot” and suddenly there were ads for Eric Ries’ online course based on his book “The Lean Startup.” (Ries is credited with first coining the term “pivot.”) Facebook puts our own friends’ photos in ads if they, according to the company, “have a direct connection with a product or service, in the same way that your friends learn through your News Feed if you’re connected with another friend or an organization’s Facebook Page.” What’s more, Facebook has a “Sponsored Stories” feature that allows advertisers to republish users’ positive posts on the site’s main news feed. While it’s creepy, Facebook knows a friend’s recommendation carries more weight than an advertisement in influencing what we buy so it decided to combine the two.
Facebook also involves an element of public shame that Google, Apple and the scads of marketers that track us online lack, sometimes forcing us to be more social than we’d like. Review a restaurant on Fondu, a new social food app for iPhone, and voila! it appears on your profile. Have a little too much fun at a party and you might discover that someone tagged you in a photo looking all bleary-eyed weary after a few too many shots of tequila. Listen to Barbra Streisand at your wife’s behest on Spotify and your reputation for edgy music could be in tatters. And do we want people at work to know we’re reading Fifty Shades of Grey?
Nevertheless, in Facebook’s IPO filing, Zuckerberg claims he built the company “to accomplish a social mission — to make the world more open and connected.” He went on to say that “We live at a moment when the majority of people in the world have access to the internet or mobile phones — the raw tools necessary to start sharing what they’re thinking, feeling and doing with whomever they want. Facebook aspires to build the services that give people the power to share and help them once again transform many of our core institutions and industries.”
To do that, it must redefine how we view privacy, which Zuckerberg views as an evolutionary process (which, of course, benefits him and Facebook). In a January 2010 interview with Techcrunch founder Michael Arrington, Zuckerberg said, “People have really gotten comfortable not only sharing more information and different kinds, but more openly and with more people. That social norm is just something that has evolved over time… But we viewed that as a really important thing, to always keep a beginner’s mind and what would we do if we were starting the company now and we decided that these would be the social norms now and we just went for it.”
On Zuckerberg’s Facebook profile, he says, “I’m trying to make the world a more open place.” Perhaps, but he is far from the living embodiment of this philosophy. In fact, he’s downright close-lipped about his personal life. His profile notes he’s in a relationship with Priscilla Chan, has a dog, lives in Palo Alto, and studied at Harvard. His time line shows he became an organ donor in 2012, became a vegetarian in 2011, and began studying Mandarin in 2010. Over the years he’s posted photos, most of which are pretty blah. He posts to the News Feed sporadically, twice a week on average for the month of April. If all of Facebook’s users were as reticent as he is, the company wouldn’t be worth a whole lot. On April 12th, though, a cartoon appeared in his News Feed that could be read as a Rorschach. In front of a bank of high school lockers, a short geek in a lab coat is threatening a jock: “Give me your lunch money or I’ll hack into your Facebook.” The caption reads: “Millions of years of evolution are finally paying off for Geeko Sapiens.”