Facebook and the crisis that undermines its reputation

Facebook went online in 2004 and has become the largest social network in the world after 17 years, during which the company has been embroiled in significant controversy.

A 3D-printed Facebook logo is seen placed on a keyboard. (Photo: Reuters)
A 3D-printed Facebook logo is seen placed on a keyboard. (Photo: Reuters)

According to experts, previous major scandals barely challenged its dominance, but the US technology giant may have reached the red line this time.

Facebook was hit by another crisis on October 4 when the social network and its family of services were knocked down globally for six hours. Four days later, Facebook encountered another outage that disrupted some key services on a similar scale for two hours.

Such incidents affected billions of people as Facebook’s services are widely used by many businesses around the world and Facebook accounts are a common method for logging in to other websites.

Amid such technical glitches, Frances Haugen, a former product manager at Facebook, testified before US senators and accused the social media giant of stoking division, harming children and called for the urgent regulation of the network. Haugen went to the Capitol after she leaked internal documents to US authorities and the Wall Street Journal.

She said the power of the social network is closely connected to the daily lives of billions of people in the world, noting that it is increasing risks for its users such as eating disorders, body image fears and low self-esteem, which can be disastrous for young people.

Haugen emphasised that “The company's leadership knows how to make Facebook and Instagram safer but won't make the necessary changes because they have put their astronomical profits before the people.”

According to Haugen, Facebook has concealed a decline in its young US users. She revealed internal projections that a drop in teenager engagement could lead to an overall decline in US users of 45% within the next two years. In the meantime, investors have long faced a lack of open disclosure as Facebook tries to avoid any actions that could lead to falls in its profits.

Haugen’s allegations have caused some to wonder whether the world would be a better place if the outage were permanent.

In fact, criticism aimed towards Facebook is incoherent and politicians are still incapable of coordinating reforms to rein in its influence. Investors have kept buying the stock, regardless of the bad news.

Some reports even show that Instagram, although making one fifth of young Americans feel worse about themselves, can also double the number of people feeling more confident about themselves.

In response to Haugen’s allegations, Lena Pietsch, Facebook's director of policy communications, stated that Haugen worked for the company for less than two years, had no direct reports, never attended a decision-point meeting with C-level executives, and that Facebook does not agree with the characterisations made by Haugen.

In the meantime, Facebook co-founder Mark Zuckerberg affirmed that the company will continue to conduct research on the social impact of the platform. He also said that US Congress needs to update its rules to make clear the legal age for teenagers to use internet services, how to verify their age and how to balance teens’ privacy while giving parents visibility into their activities instead of entrusting this solely to online platforms. Zuckerberg noted that YouTube also faces a similar issue, not just Facebook.

Facebook’s shares, though falling compared to some other technology giants after the controversy, still rose nearly 30% in the past 12 months. The US Justice Department’s claim that Facebook is a monopoly rests on defining its market so as to exclude most social networks. But the nonsense of this was demonstrated by the outage, when users flocked to apps like Telegram, TikTok and Twitter. Many said that Facebook is on the path of joining the ranks of corporate untouchables like big tobacco.

According to the Guardian newspaper’s investigative journalist Carole Cadwalladr, who exposed the Cambridge Analytica scandal involving Facebook in 2018, Facebook is in trouble and facing many legal and regulatory challenges. Compared to 2018, Facebook has no longer maintained its dominant position while facing suspicion from its workforce and a sharp fall in the numbers of young users.

Another difference between 2021 and 2018 is that people such as Haugen is provided with strong support. The industry is welcoming and backing whistle-blowers reporting the irregularities of top companies.

Today US senators also know more about technology than three years ago, as seen in the much more professional way they put questions to Haugen at the testimony on October 5 than that put forward in previous testimonies.