[Applause]
welcome back to case studies with the
biz doc this week it’s Facebook and the
security scandal now there’s a million
stories have been written about it but
I’m going to take you in a case study
that shows this is the way they always
intended it to be part one I’m going to
take you through a history to show you
that security controversy and privacy
has been an issue of Facebook since Mark
Zuckerberg left his Harvard dorm room
part two I’m then gonna take you and
show you how you are exposed far more
than you know and what just happened
with Cambridge analytic is only the tip
of the iceberg of what third-party app
developers have had access to and I know
something about it because I once built
an app and the third thing we’re going
to go through and I’m going to show you
some very startling things that have
been hiding below the surface as the
stories about Cambridge analytic have
been percolating up and everybody’s been
focusing on President Trump and what
does he said today what did he tweet
what’s going on hiding below the surface
or stories that clearly show Trump was
elected by Zuck using Facebook
technology
forget about Russia forget about all
that controversy underneath it all
Trump’s us organization was using
Facebook far better than a Hillary
Clinton far better than Hillary Clinton
and that technology was part of what
elected and president duck elected Trump
let’s go to part one in the history I’m
gonna take you through now let’s go back
and take a look at some of the facts and
the players on the Facebook Timeline
they say sometimes that the way to
understand a man is to look at his
upbringing and to look at the man he was
then you see him twenty years later at
the high school reunion and you discover
not very much has changed well in part
one of the history let’s go to 2004 and
take a look at some texts that were sent
by Mark Zuckerberg back then they were
called IMS first from his Harvard dorm
room he had some i M chatter with the
classmate and the friend was saying so
have you decided what you’re going to do
about the websites yeah I’m going to f
them probably in a year he says yeah so
if you ever need info about anyone at
Harvard just asked
I have over 4,000 emails pictures
addresses and SMS what how did you
manage that one people just submitted it
I don’t know why they trust me dumb f
s– when you look at the so in 2004 we
can clearly see harvard texts are
showing mark zuckerberg knew exactly
what he was getting big stacks of data
now as Facebook matured and went forward
other things started cropping up and
things that we could see in 2006 a
couple years after Facebook was born the
newsfeed came up and he started using
correlation information between you and
me and the newsfeed was where we first
started reacted saying wait a minute how
do you know this about me how do you
know that about me and why are you
showing me this about this friend or
that about this friend
Facebook’s response was just to tell us
all to relax and take a chill pill
but that newsfeed in September 2006 was
the first indication that there was a
lot more going on with our data that was
on Facebook than just posting it there
and hoping friends happened by the
newsfeed was born and we realized that
there were algorithms in the background
playing with our data and showing us
some of our friends and not all of our
friends the controversy died down then
in December of 2007 Facebook announced
beacon and what beacon was it was an
advertising tool and companies could
track purchases made by Facebook users
and then tell their friends what they
had bought and a lot of times this was
happening with credit-card correlation
information that we didn’t want people
to know wait a minute I didn’t want
people to know that I just bought this
or that perhaps this is my girlfriend
just discovering what I bought her for
her birthday but in 2007 purchase
history and beacon was a huge
controversy we jumped forward a few
years to a big case with the American
Federal Trade Commission 2011 Facebook
had to undergo an independent privacy
evaluation like every couple years or
something as a result and that was like
a 20 year sentence like for 20 years
they had to go through this every couple
years privacy evaluation and if they
were going to violate it they were gonna
have to pay 16 thousand dollars per day
16 thousand dollars per day
to violate it in other words it’s
probably less than Facebook spends on
employee lunches nonetheless that’s
November of 2011 and it’s a it’s a
privacy settlement with the United
States Federal Trade Commission in June
of 2013 then Facebook says there was a
bug that exposed some private
information and they said well how much
email addresses phone numbers and some
information for six million Facebook
users and it was basically exposed to
any developer anyone who had a
connection to someone else and the there
was actually a hacker and this is where
hackers were starting to show up in the
history and it was called the white hat
hacker and he had come in or she had
come in and broken into this and exposed
this and this is June of 2013 of 2013
which was a huge huge moment where now
we’re realizing that hackers can get in
and expose some of the deeper things
that were going on then we go to mood
manipulation July 2014 there’s a mood
manipulation experiment and there was a
facebook data scientists that issued
this huge apology to people and what
they did is they took a bunch of
randomly selected people and they
altered our news feeds to show more
positive or more negative posts thinking
that they would alter our mood and and
some of the things we put up we’re
positive or negative wait a minute
I’m just posting my stuff up here I have
to look at some ads have to do things so
I can use Facebook for free and now
you’re finding out that you’re actually
messing with my head huge controversy
and the data scientist apologizes but if
you don’t think you can draw a straight
line from 2014 now to 2018 in Kimber
analytic you’re not paying attention
then in April 15th Facebook claimed they
cut off apps from taking all the data
they want but the the quiet underlining
sentiment there to people was hey man
just keep making those apps keep making
those apps so that shows you on that
history timeline how your data my data
has been used by Facebook for a long
time those third-party developers have
had access to it to do many things and
Ted Cruz had access to it for his
presidential campaign through Cambridge
analytic aback in 2015 three years ago
so you step back into that and you also
see the Federal Trade Commission getting
involved and you go back to the dawn and
you see what they had done in the first
place with data Facebook is never gonna
make money unless I could sell ads ad
targeting on the internet and more
information about you and me is
necessary so they could charge more for
those ads or charge third parties to use
that data it’s as simple as that
that’s how Facebook became the huge
multi hundred note billion valued
company that they are today they had to
sell it it’s not a free sandbox for you
and me you can’t be naive about this
so if history shows us lesson one this
was always going to be the way it was
we’re just now reacting to it because we
don’t like it because we didn’t think
about it because we were using Facebook
for free to trade baby pictures and keep
our friends informed and see unlife
among our greater circle of influencers
let’s go to part two you are more
exposed than you know and it all showed
up now let’s turn to the board and look
at what I mean by that in the timeline
only of 2018 we just looked at a
timeline dating back now let’s just look
at the timeline on the just this year in
January facebook updated the news feeds
again people say what are you doing well
Rupp dating some of the news feeds are
doing some things for adjusting it for a
variety of reasons and there is a little
bit of a controversy there then on
January 23rd Marc Benioff the founder of
salesforce.com he says this I got in
trouble with friends of mine at Facebook
who are calling me and very upset with
me because I said Facebook is the new
cigarettes it’s addictive it’s not good
for you and there’s outside forces
trying to manipulate you to use it seems
pretty clear about how Marc Benioff felt
about it and actually he was just being
honest but in the bubble of Silicon
Valley there are a lot of people calling
him that were very upset with that then
we move to the end of January January
31st and Mark Zuckerberg makes a little
soft announcement to the market that was
heard loud and clear that the amount of
time and engagement people were spending
on it was starting to shift a little bit
and some of that time was going down the
market became a little
nervously wait a minute time on Facebook
is key to information and data and
seeing ads and people corporations
paying you for those ads as your
business model whoa Nelly what’s going
on there well nonetheless that was the
first little salvo that let us know that
something may be amiss with the actual
usage of Facebook’s all the other
controversies aside then we get to
February 12th how bad is it
emarketer says that they were losing the
12 to 17 year olds at a rate that no one
understood or they’re not even getting
them and that study said that in the
United States 12 to 17 year olds 50% of
them will not use Facebook in 2018 let
me say that again your kids are less
exposed than you are because half of
them this year are not even going to be
on Facebook putting their pictures and
images things you know where they are
snapchat Instagram other places and yes
Instagram is a Facebook property I get
it but the point is Facebook isn’t be
increasing Lee seen by the new
generation as that to love their parents
and aunts and uncles we move on just a
few days later 25% of America surveyed
that said that they thought Facebook
should be fined for some of the things
that were going on and the manipulation
of private data and the exposure of
private data now Cambridge analytic I
haven’t popped into the mainstream but
just people are starting to say you know
I think they should pay a fine for the
way they’ve been using data and of
course they’re referencing this river
that goes all the way back to 2004 for
Facebook has had privacy controversies
and a lot of drama in the media about
what they’re doing with your and my
private information now then we have
it’s a little quiet and in February
there’s a lot of news stories and
popular press offering commentator on it
but the real fun starts in March and in
March the first thing that happens is
there is a survey that was on Facebook
that included questions about pedophiles
and people are suddenly asking wait a
minute do you sense more going on there
and the question was why would there be
a survey like that running at Facebook
didn’t are we
no the way Facebook perhaps was being
used suddenly people are like well maybe
it’s a good thing that my 12 the 17 year
old daughter is not on Facebook if they
know how predators were manipulating and
using the tool for no good it’s as if
that wasn’t bad enough then Cambridge
analytic ah and I think that how they
responded to Cambridge analytic as a
case study in itself that just shows you
exactly what the point of my case study
is about this is the way it was always
supposed to be they didn’t deny that
they used the data they didn’t deny they
were given access to the data they
didn’t deny that that was the whole
point of their relationship with
Cambridge analytic I what they said was
there was no data breach nobody hacked
through a firewall you know nobody did
anything like this this isn’t a bunch of
you know people from some you know bad
actor country around the world that’s
you know penetrated this no you didn’t
need a hacker they came right through
the front door as a third-party app
provider on Facebook and they were
allowed to use the data there’s some
very interesting things that came out
came out of that you saw the way
Facebook was reacting and you saw the
way that Zuckerberg and Sheryl Sandberg
went silent disappeared ghosted
themselves well what’s going on there
I’ll tell you what was going on there
they didn’t know what to say because
this is the always the way it was going
to be and in the midst of it we found
out just how much data was being used
and how Facebook was a little bit
two-faced and actually been cooperating
a little bit during this time and what
was exposed with a tweet from Carol
Davidson who is a director of data
integration for Obama America and she
tweets this on March 18th tweet number
one Facebook was surprised when we the
Obama America campaign were able to suck
out the whole social graph but they
didn’t stop us once they realized what
we were doing tweet number two they came
into the office following the election
recruiting and we’re very candid that
they allowed us to do the things they
wouldn’t have allowed someone else to do
because they were on our side
oh so wait a minute so now at a time
when Facebook was denying that it was
suppressing conservative news stories
something that got it into very hot
water come
the news that they were completely
complicit in the Obama campaign now I’m
not here to make a political statement
of this campaign or that campaign or
anything like that the point was
Facebook knew how the data was used and
they didn’t do anything to stop it and
Carol Davidson with Obama America was
like yeah and they liked our side the
left and liberal side so they didn’t do
anything about it and we’re about to
find out how the trumpet campaign did it
far better and just whooped Hillary
Clinton with it and these facts are
according to a white paper that was
circulated inside Facebook first thing
is we have the Trump campaign boldly
stating that they were better at
Facebook then the Clinton campaign was
and this white paper inside Facebook
proved it first of all the white paper
noted that they received 44 million
dollars from the Trump campaign and only
28 million dollars from the Clinton
campaign you’re not seeing this in
popular media but it clearly shows why
were they charging him so much to
advertise to you and me but what was
happening under their wall Cambridge
analytic Oh is helping Trump hone those
ads forget everything about Russia it’s
an important issue and it’s being
investigated but the Russians didn’t
elect Trump if you take a look at what
happened here
Trump ran an amazing campaign and got to
his particular voters and Facebook was a
key part of it for instance not only did
they spend more and they said they were
better at Facebook and Facebook agreed
they said yeah you were why do you say
that Facebook well because we did the
research did you know that Trump read
5.9 million ad variations in other words
ad test response ad test response ad
test response and you have these
automated systems that run that to see
how people are responding to your ad
whether you’re trying to get elected
president or sell a trip to Hawaii they
also found that 84% of those ads were
very sharp-edged asking for action in
other words the ads asked the viewer the
person that the ad was surgery to take
action 84 percent of the time the
Clinton campaign 66,000 ad variations
which means this is a far more primitive
algorithm if there even is an algorithm
running
and only 56% were asking to take action
this is a white paper in front in
Facebook folks for they were analyzing
what went on
Huck knew exactly what was going on with
the data and they knew exactly what
firms like Cambridge have that litical
were doing about it and going back to
the previous campaign they allowed it to
happen because they wanted Obama to be
elected they got whupped because Clinton
ran that campaign and Trump was much
better at it so if we don’t think that
this was always the way that this was
going to operate you’re not paying
attention meanwhile back at the ranch
Cambridge analytic is out there and Mark
and Sheryl are gone in silent a couple
days later on the 21st
the Zuckerberg goes out and says I’m so
sorry there’s been a breach of trust he
goes on CNN and a carefully crafted
interview he’s really not hammered too
hard he did some other media outlets who
were more incisive in their reporting
and then he takes out full-page ads
we’re so sorry that this has happened
what’s he gonna do tear up his business
plan is he gonna stop selling ads and if
you stop selling ads how how does
Facebook stay in business the whole
point of this is it has to continue and
continue at will but under a microscope
as the UK and the US and these are demet
Ed Markey a Democrat Senator in the u.s.
said hey we want you to come in here to
Congress and we want to have testimony
and we want to have some hearings here
uh-oh
well they’re being called the testament
and we have the first call that I was
able to see the gentleman that runs the
New York City pension fund is calling
for Mark Zuckerberg to step down as
chairman of Facebook and to install
people that are reasoned and experienced
with privacy matters in other words this
whole thing if you go back to the
history of Facebook it was set up to do
whatever Mark wanted to do by various
classes of stock and some things that
give him overwhelming vote and control
this is the danger when one man at one
company has overwhelming vote and
control you have Outsiders not your
board and the rest of the investment
community that really has you know power
and control to influence when
things get rough as they have today and
not only is it happening in Senate not
owners happening in Congress but we have
a couple other people such as this
gentleman Elon Musk and must deleted his
facebook pages for Tesla and Space
Exploration and apparently it was a
Twitter user had asked him to do it and
look at this quote I just don’t like
Facebook he wrote it gives me the
willies sorry to me that’s pretty
damning to have a pillar of technology
reaching out and saying something first
Marc Benioff then Elon Musk but it got
worse Brian Acton of whatsapp which I
think was bought by Facebook for 19
billion dollars or something he actually
came out and said delete Facebook now
Brian may be a little bit biased because
he and his friends are trying to also
build a new company that does compete in
certain ways of Facebook but still
you’ve got someone who’s a friend of the
family who was paid 19 billion by
Facebook he’s out there with the hashtag
delete Facebook campaign so the whole
point of this case study is to take a
look and realize history clearly shows
this was always the way it was going to
be and you’re exposed far more than you
know there are things out there right
now where they say that you can turn
this off turn that off the only real
question about your data is what day do
you stop sharing it because you can’t
erase the past and you can’t erase
what’s on servers and your kids maybe
it’s through fad maybe it’s through
taste they’re not they’re no longer
looking at Facebook as a source for
their social media presence therefore
your kids are probably have less of
their information and less exposed and
more sensitive to privacy than you or I
are who have years and years and years
including these cheerful little things
that pop up oh look five years ago this
is what happened and here’s all the
things that went with it trying to keep
engagement trying to keep us there and
that lesson number three suck elected
Trump that I think is one of the bigger
stories that’s underneath the covers
here that nobody is pointing to because
the liberal media doesn’t want to know
about the liberal media doesn’t want to
pick on one of their own and I know
there’s conservative media that is as
biased as liberal media but the facts
simply show Facebook got Trump elected
because everything that they did
previously backfired on them and all the
party apps I had open access to your
social graph from my social graph there
is one group that just used it far
better than another group this according
to Facebook’s own research which is
pretty telling
and pretty damning and never mind
election consequences consequences of
far greater importance we’re well known
inside Facebook
Andrew Bosworth who is now the VP of
consumer hardware I believe it is at
Facebook wrote a memo going back into
2016 that basically said here’s the ugly
side of Facebook terrorists could use it
for this bullying could happen this
these things could happen but that
shouldn’t deter us in our March for
increased subscriber count and increased
engagement now Mark Zuckerberg saw that
in the media here in 2018 and he said oh
I am I don’t agree with that he’s got
strong opinions and things but I don’t
agree with that yet when asked by the
media to produce anything from 2016
where Mark Zuckerberg sent an email or
made a statement back to the company
staying
hey what Andrew Bosworth just said I
don’t agree with nothing crickets the
answer was he didn’t say anything
because he agrees with it because that’s
the whole point to it well guess what
when you say something like that and you
see it out in the media sometime you get
the attention of people such as this guy
Senator Ed Markey death from bullying
cannot be the cost of doing business
terrorist attacks cannot be the cost of
doing business it’s Facebook’s moral
obligation to maintain the integrity and
safety of their platform when they fail
to do so Congress must act you know what
there’s three things that I never want
to see in the headline newspaper of a
company I’m at the number one is CEO
ignited and the number two is Congress
wants to hold hearings and investigate
you you say have a memo like that that
goes out to the public and the Ellison
you have a senator saying bullying and a
death that’s not the cost of doing
business there’s only one word for that
is damn you’re tone deaf you’re living
in this little bubble of what you’re
trying to build and you don’t see an
obligation if you’re make drugs you have
to make safe drugs if you make a car you
have to make a safe car if you make
children’s toys you have to make safe
ones and if you make a social media
platform you got to make a safe one and
you have to take steps when the
unintended consequences and unintended
uses are happening there in the public
square and that’s exact
what happened but when we go all the way
back to the beginning this was exactly
where Zuckerberg thought it was going he
may not have understood all these things
that are here but when he made those
comments in his dorm room in those Iams
in 2004 he knew exactly what the value
of all those people
mindlessly sharing data with Facebook
was we enjoy it it’s entertaining but
along the way the advertising the
profiling mood-altering experiments and
moving elections are all the unintended
consequences that are just down the
river as it starts rushing rapidly
regarding your information my
information and how it’s used and it’s
no longer private but thank goodness 50%
of our children are not doing it and
they’re gonna have a little bit
different privacy profile as they grow
up at least we hope and there you have
it please subscribe to value tame it
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in life until next time I’m Tom Merritt
the biz doc and I hope I left you better than I found
welcome back to case studies with the
biz doc this week it’s Facebook and the
security scandal now there’s a million
stories have been written about it but
I’m going to take you in a case study
that shows this is the way they always
intended it to be part one I’m going to
take you through a history to show you
that security controversy and privacy
has been an issue of Facebook since Mark
Zuckerberg left his Harvard dorm room
part two I’m then gonna take you and
show you how you are exposed far more
than you know and what just happened
with Cambridge analytic is only the tip
of the iceberg of what third-party app
developers have had access to and I know
something about it because I once built
an app and the third thing we’re going
to go through and I’m going to show you
some very startling things that have
been hiding below the surface as the
stories about Cambridge analytic have
been percolating up and everybody’s been
focusing on President Trump and what
does he said today what did he tweet
what’s going on hiding below the surface
or stories that clearly show Trump was
elected by Zuck using Facebook
technology
forget about Russia forget about all
that controversy underneath it all
Trump’s us organization was using
Facebook far better than a Hillary
Clinton far better than Hillary Clinton
and that technology was part of what
elected and president duck elected Trump
let’s go to part one in the history I’m
gonna take you through now let’s go back
and take a look at some of the facts and
the players on the Facebook Timeline
they say sometimes that the way to
understand a man is to look at his
upbringing and to look at the man he was
then you see him twenty years later at
the high school reunion and you discover
not very much has changed well in part
one of the history let’s go to 2004 and
take a look at some texts that were sent
by Mark Zuckerberg back then they were
called IMS first from his Harvard dorm
room he had some i M chatter with the
classmate and the friend was saying so
have you decided what you’re going to do
about the websites yeah I’m going to f
them probably in a year he says yeah so
if you ever need info about anyone at
Harvard just asked
I have over 4,000 emails pictures
addresses and SMS what how did you
manage that one people just submitted it
I don’t know why they trust me dumb f
s– when you look at the so in 2004 we
can clearly see harvard texts are
showing mark zuckerberg knew exactly
what he was getting big stacks of data
now as Facebook matured and went forward
other things started cropping up and
things that we could see in 2006 a
couple years after Facebook was born the
newsfeed came up and he started using
correlation information between you and
me and the newsfeed was where we first
started reacted saying wait a minute how
do you know this about me how do you
know that about me and why are you
showing me this about this friend or
that about this friend
Facebook’s response was just to tell us
all to relax and take a chill pill
but that newsfeed in September 2006 was
the first indication that there was a
lot more going on with our data that was
on Facebook than just posting it there
and hoping friends happened by the
newsfeed was born and we realized that
there were algorithms in the background
playing with our data and showing us
some of our friends and not all of our
friends the controversy died down then
in December of 2007 Facebook announced
beacon and what beacon was it was an
advertising tool and companies could
track purchases made by Facebook users
and then tell their friends what they
had bought and a lot of times this was
happening with credit-card correlation
information that we didn’t want people
to know wait a minute I didn’t want
people to know that I just bought this
or that perhaps this is my girlfriend
just discovering what I bought her for
her birthday but in 2007 purchase
history and beacon was a huge
controversy we jumped forward a few
years to a big case with the American
Federal Trade Commission 2011 Facebook
had to undergo an independent privacy
evaluation like every couple years or
something as a result and that was like
a 20 year sentence like for 20 years
they had to go through this every couple
years privacy evaluation and if they
were going to violate it they were gonna
have to pay 16 thousand dollars per day
16 thousand dollars per day
to violate it in other words it’s
probably less than Facebook spends on
employee lunches nonetheless that’s
November of 2011 and it’s a it’s a
privacy settlement with the United
States Federal Trade Commission in June
of 2013 then Facebook says there was a
bug that exposed some private
information and they said well how much
email addresses phone numbers and some
information for six million Facebook
users and it was basically exposed to
any developer anyone who had a
connection to someone else and the there
was actually a hacker and this is where
hackers were starting to show up in the
history and it was called the white hat
hacker and he had come in or she had
come in and broken into this and exposed
this and this is June of 2013 of 2013
which was a huge huge moment where now
we’re realizing that hackers can get in
and expose some of the deeper things
that were going on then we go to mood
manipulation July 2014 there’s a mood
manipulation experiment and there was a
facebook data scientists that issued
this huge apology to people and what
they did is they took a bunch of
randomly selected people and they
altered our news feeds to show more
positive or more negative posts thinking
that they would alter our mood and and
some of the things we put up we’re
positive or negative wait a minute
I’m just posting my stuff up here I have
to look at some ads have to do things so
I can use Facebook for free and now
you’re finding out that you’re actually
messing with my head huge controversy
and the data scientist apologizes but if
you don’t think you can draw a straight
line from 2014 now to 2018 in Kimber
analytic you’re not paying attention
then in April 15th Facebook claimed they
cut off apps from taking all the data
they want but the the quiet underlining
sentiment there to people was hey man
just keep making those apps keep making
those apps so that shows you on that
history timeline how your data my data
has been used by Facebook for a long
time those third-party developers have
had access to it to do many things and
Ted Cruz had access to it for his
presidential campaign through Cambridge
analytic aback in 2015 three years ago
so you step back into that and you also
see the Federal Trade Commission getting
involved and you go back to the dawn and
you see what they had done in the first
place with data Facebook is never gonna
make money unless I could sell ads ad
targeting on the internet and more
information about you and me is
necessary so they could charge more for
those ads or charge third parties to use
that data it’s as simple as that
that’s how Facebook became the huge
multi hundred note billion valued
company that they are today they had to
sell it it’s not a free sandbox for you
and me you can’t be naive about this
so if history shows us lesson one this
was always going to be the way it was
we’re just now reacting to it because we
don’t like it because we didn’t think
about it because we were using Facebook
for free to trade baby pictures and keep
our friends informed and see unlife
among our greater circle of influencers
let’s go to part two you are more
exposed than you know and it all showed
up now let’s turn to the board and look
at what I mean by that in the timeline
only of 2018 we just looked at a
timeline dating back now let’s just look
at the timeline on the just this year in
January facebook updated the news feeds
again people say what are you doing well
Rupp dating some of the news feeds are
doing some things for adjusting it for a
variety of reasons and there is a little
bit of a controversy there then on
January 23rd Marc Benioff the founder of
salesforce.com he says this I got in
trouble with friends of mine at Facebook
who are calling me and very upset with
me because I said Facebook is the new
cigarettes it’s addictive it’s not good
for you and there’s outside forces
trying to manipulate you to use it seems
pretty clear about how Marc Benioff felt
about it and actually he was just being
honest but in the bubble of Silicon
Valley there are a lot of people calling
him that were very upset with that then
we move to the end of January January
31st and Mark Zuckerberg makes a little
soft announcement to the market that was
heard loud and clear that the amount of
time and engagement people were spending
on it was starting to shift a little bit
and some of that time was going down the
market became a little
nervously wait a minute time on Facebook
is key to information and data and
seeing ads and people corporations
paying you for those ads as your
business model whoa Nelly what’s going
on there well nonetheless that was the
first little salvo that let us know that
something may be amiss with the actual
usage of Facebook’s all the other
controversies aside then we get to
February 12th how bad is it
emarketer says that they were losing the
12 to 17 year olds at a rate that no one
understood or they’re not even getting
them and that study said that in the
United States 12 to 17 year olds 50% of
them will not use Facebook in 2018 let
me say that again your kids are less
exposed than you are because half of
them this year are not even going to be
on Facebook putting their pictures and
images things you know where they are
snapchat Instagram other places and yes
Instagram is a Facebook property I get
it but the point is Facebook isn’t be
increasing Lee seen by the new
generation as that to love their parents
and aunts and uncles we move on just a
few days later 25% of America surveyed
that said that they thought Facebook
should be fined for some of the things
that were going on and the manipulation
of private data and the exposure of
private data now Cambridge analytic I
haven’t popped into the mainstream but
just people are starting to say you know
I think they should pay a fine for the
way they’ve been using data and of
course they’re referencing this river
that goes all the way back to 2004 for
Facebook has had privacy controversies
and a lot of drama in the media about
what they’re doing with your and my
private information now then we have
it’s a little quiet and in February
there’s a lot of news stories and
popular press offering commentator on it
but the real fun starts in March and in
March the first thing that happens is
there is a survey that was on Facebook
that included questions about pedophiles
and people are suddenly asking wait a
minute do you sense more going on there
and the question was why would there be
a survey like that running at Facebook
didn’t are we
no the way Facebook perhaps was being
used suddenly people are like well maybe
it’s a good thing that my 12 the 17 year
old daughter is not on Facebook if they
know how predators were manipulating and
using the tool for no good it’s as if
that wasn’t bad enough then Cambridge
analytic ah and I think that how they
responded to Cambridge analytic as a
case study in itself that just shows you
exactly what the point of my case study
is about this is the way it was always
supposed to be they didn’t deny that
they used the data they didn’t deny they
were given access to the data they
didn’t deny that that was the whole
point of their relationship with
Cambridge analytic I what they said was
there was no data breach nobody hacked
through a firewall you know nobody did
anything like this this isn’t a bunch of
you know people from some you know bad
actor country around the world that’s
you know penetrated this no you didn’t
need a hacker they came right through
the front door as a third-party app
provider on Facebook and they were
allowed to use the data there’s some
very interesting things that came out
came out of that you saw the way
Facebook was reacting and you saw the
way that Zuckerberg and Sheryl Sandberg
went silent disappeared ghosted
themselves well what’s going on there
I’ll tell you what was going on there
they didn’t know what to say because
this is the always the way it was going
to be and in the midst of it we found
out just how much data was being used
and how Facebook was a little bit
two-faced and actually been cooperating
a little bit during this time and what
was exposed with a tweet from Carol
Davidson who is a director of data
integration for Obama America and she
tweets this on March 18th tweet number
one Facebook was surprised when we the
Obama America campaign were able to suck
out the whole social graph but they
didn’t stop us once they realized what
we were doing tweet number two they came
into the office following the election
recruiting and we’re very candid that
they allowed us to do the things they
wouldn’t have allowed someone else to do
because they were on our side
oh so wait a minute so now at a time
when Facebook was denying that it was
suppressing conservative news stories
something that got it into very hot
water come
the news that they were completely
complicit in the Obama campaign now I’m
not here to make a political statement
of this campaign or that campaign or
anything like that the point was
Facebook knew how the data was used and
they didn’t do anything to stop it and
Carol Davidson with Obama America was
like yeah and they liked our side the
left and liberal side so they didn’t do
anything about it and we’re about to
find out how the trumpet campaign did it
far better and just whooped Hillary
Clinton with it and these facts are
according to a white paper that was
circulated inside Facebook first thing
is we have the Trump campaign boldly
stating that they were better at
Facebook then the Clinton campaign was
and this white paper inside Facebook
proved it first of all the white paper
noted that they received 44 million
dollars from the Trump campaign and only
28 million dollars from the Clinton
campaign you’re not seeing this in
popular media but it clearly shows why
were they charging him so much to
advertise to you and me but what was
happening under their wall Cambridge
analytic Oh is helping Trump hone those
ads forget everything about Russia it’s
an important issue and it’s being
investigated but the Russians didn’t
elect Trump if you take a look at what
happened here
Trump ran an amazing campaign and got to
his particular voters and Facebook was a
key part of it for instance not only did
they spend more and they said they were
better at Facebook and Facebook agreed
they said yeah you were why do you say
that Facebook well because we did the
research did you know that Trump read
5.9 million ad variations in other words
ad test response ad test response ad
test response and you have these
automated systems that run that to see
how people are responding to your ad
whether you’re trying to get elected
president or sell a trip to Hawaii they
also found that 84% of those ads were
very sharp-edged asking for action in
other words the ads asked the viewer the
person that the ad was surgery to take
action 84 percent of the time the
Clinton campaign 66,000 ad variations
which means this is a far more primitive
algorithm if there even is an algorithm
running
and only 56% were asking to take action
this is a white paper in front in
Facebook folks for they were analyzing
what went on
Huck knew exactly what was going on with
the data and they knew exactly what
firms like Cambridge have that litical
were doing about it and going back to
the previous campaign they allowed it to
happen because they wanted Obama to be
elected they got whupped because Clinton
ran that campaign and Trump was much
better at it so if we don’t think that
this was always the way that this was
going to operate you’re not paying
attention meanwhile back at the ranch
Cambridge analytic is out there and Mark
and Sheryl are gone in silent a couple
days later on the 21st
the Zuckerberg goes out and says I’m so
sorry there’s been a breach of trust he
goes on CNN and a carefully crafted
interview he’s really not hammered too
hard he did some other media outlets who
were more incisive in their reporting
and then he takes out full-page ads
we’re so sorry that this has happened
what’s he gonna do tear up his business
plan is he gonna stop selling ads and if
you stop selling ads how how does
Facebook stay in business the whole
point of this is it has to continue and
continue at will but under a microscope
as the UK and the US and these are demet
Ed Markey a Democrat Senator in the u.s.
said hey we want you to come in here to
Congress and we want to have testimony
and we want to have some hearings here
uh-oh
well they’re being called the testament
and we have the first call that I was
able to see the gentleman that runs the
New York City pension fund is calling
for Mark Zuckerberg to step down as
chairman of Facebook and to install
people that are reasoned and experienced
with privacy matters in other words this
whole thing if you go back to the
history of Facebook it was set up to do
whatever Mark wanted to do by various
classes of stock and some things that
give him overwhelming vote and control
this is the danger when one man at one
company has overwhelming vote and
control you have Outsiders not your
board and the rest of the investment
community that really has you know power
and control to influence when
things get rough as they have today and
not only is it happening in Senate not
owners happening in Congress but we have
a couple other people such as this
gentleman Elon Musk and must deleted his
facebook pages for Tesla and Space
Exploration and apparently it was a
Twitter user had asked him to do it and
look at this quote I just don’t like
Facebook he wrote it gives me the
willies sorry to me that’s pretty
damning to have a pillar of technology
reaching out and saying something first
Marc Benioff then Elon Musk but it got
worse Brian Acton of whatsapp which I
think was bought by Facebook for 19
billion dollars or something he actually
came out and said delete Facebook now
Brian may be a little bit biased because
he and his friends are trying to also
build a new company that does compete in
certain ways of Facebook but still
you’ve got someone who’s a friend of the
family who was paid 19 billion by
Facebook he’s out there with the hashtag
delete Facebook campaign so the whole
point of this case study is to take a
look and realize history clearly shows
this was always the way it was going to
be and you’re exposed far more than you
know there are things out there right
now where they say that you can turn
this off turn that off the only real
question about your data is what day do
you stop sharing it because you can’t
erase the past and you can’t erase
what’s on servers and your kids maybe
it’s through fad maybe it’s through
taste they’re not they’re no longer
looking at Facebook as a source for
their social media presence therefore
your kids are probably have less of
their information and less exposed and
more sensitive to privacy than you or I
are who have years and years and years
including these cheerful little things
that pop up oh look five years ago this
is what happened and here’s all the
things that went with it trying to keep
engagement trying to keep us there and
that lesson number three suck elected
Trump that I think is one of the bigger
stories that’s underneath the covers
here that nobody is pointing to because
the liberal media doesn’t want to know
about the liberal media doesn’t want to
pick on one of their own and I know
there’s conservative media that is as
biased as liberal media but the facts
simply show Facebook got Trump elected
because everything that they did
previously backfired on them and all the
party apps I had open access to your
social graph from my social graph there
is one group that just used it far
better than another group this according
to Facebook’s own research which is
pretty telling
and pretty damning and never mind
election consequences consequences of
far greater importance we’re well known
inside Facebook
Andrew Bosworth who is now the VP of
consumer hardware I believe it is at
Facebook wrote a memo going back into
2016 that basically said here’s the ugly
side of Facebook terrorists could use it
for this bullying could happen this
these things could happen but that
shouldn’t deter us in our March for
increased subscriber count and increased
engagement now Mark Zuckerberg saw that
in the media here in 2018 and he said oh
I am I don’t agree with that he’s got
strong opinions and things but I don’t
agree with that yet when asked by the
media to produce anything from 2016
where Mark Zuckerberg sent an email or
made a statement back to the company
staying
hey what Andrew Bosworth just said I
don’t agree with nothing crickets the
answer was he didn’t say anything
because he agrees with it because that’s
the whole point to it well guess what
when you say something like that and you
see it out in the media sometime you get
the attention of people such as this guy
Senator Ed Markey death from bullying
cannot be the cost of doing business
terrorist attacks cannot be the cost of
doing business it’s Facebook’s moral
obligation to maintain the integrity and
safety of their platform when they fail
to do so Congress must act you know what
there’s three things that I never want
to see in the headline newspaper of a
company I’m at the number one is CEO
ignited and the number two is Congress
wants to hold hearings and investigate
you you say have a memo like that that
goes out to the public and the Ellison
you have a senator saying bullying and a
death that’s not the cost of doing
business there’s only one word for that
is damn you’re tone deaf you’re living
in this little bubble of what you’re
trying to build and you don’t see an
obligation if you’re make drugs you have
to make safe drugs if you make a car you
have to make a safe car if you make
children’s toys you have to make safe
ones and if you make a social media
platform you got to make a safe one and
you have to take steps when the
unintended consequences and unintended
uses are happening there in the public
square and that’s exact
what happened but when we go all the way
back to the beginning this was exactly
where Zuckerberg thought it was going he
may not have understood all these things
that are here but when he made those
comments in his dorm room in those Iams
in 2004 he knew exactly what the value
of all those people
mindlessly sharing data with Facebook
was we enjoy it it’s entertaining but
along the way the advertising the
profiling mood-altering experiments and
moving elections are all the unintended
consequences that are just down the
river as it starts rushing rapidly
regarding your information my
information and how it’s used and it’s
no longer private but thank goodness 50%
of our children are not doing it and
they’re gonna have a little bit
different privacy profile as they grow
up at least we hope and there you have
it please subscribe to value tame it
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in life until next time I’m Tom Merritt
the biz doc and I hope I left you better than I found
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