Facebook Problems - Case Study Example

Case introduction

From inception, Facebook has always been faced with issues surrounding the unauthorized mining and use of user data for monetary purposes. This company was founded in 2004. During the first years after its inception, the company was faced with a plethora of lawsuits questioning the amount of data the company was acquiring from its users and how the company intended to use the data. As a result, one of the most popular news published about the company and the social interaction platform pertained to unethical practices in data mining and illegal data sharing with unauthorized third parties. During all these incidences, the company managed to downplay the issue until it was forgotten, and people moved on. Thus, the company has not once shown any real efforts to resolve privacy issues and has continued to blatantly ignore its users' complaints against using their data for financial gain.

Over time, the public has become tired of complaining about the security and privacy issues faced by the company and focused on the ineffectiveness of the company's business model. These individual snows believe that from its inception, the company utilized a business model that could not ensure user data security. For instance, to create an account with Facebook, an individual must provide their phone number, email, picture, and a password. In addition to providing this information while signing into the platform, once individuals have an account, they are expected to list their hobbies, the schools they attended, and other activities they like doing. According to the company, this information is useful in determining the people that a user may know. This is a critical aspect of the platform in promoting social interaction. It shows people with similar values and backgrounds to each other in the hope that their similarities would promote positive interaction. In so doing, this company became the only platform to promote the idea of a global village. However, despite having its benefits, this innovation came at a cost. The company was in 2018 involved in the Cambridge Analytica scandal that associated the company with data manipulation. This case involved data mining from Facebook to facilitate campaign for Brexit in the UK. Two years before this incident, the same companies had conspired to facilitate President Trump's presidential campaign. This analysis intends to establish ways through which the organization model has affected its operations globally, the risks the company faces and benefits it enjoys, and how the risks can be mitigated through strategic recommendations.

Global issues

Global issues affecting this company pertain to data issues. For as long as this company has existed, it has been faced by challenges pertaining to its data. Furthermore, there have been questions surrounding how this company uses or intends to use the data it collects from its users. According to this case study, in March 2018, Facebook users learned that the company had allowed Cambridge Analytica to use its data to design political campaigns. This revelation that the company had used user data to manipulate US voters into voting for President Trump was received with rage by the users. In response to this breach of trust, the #leave Facebook campaign was initiated, which saw popular individuals like Elon Musk, the owner of Tesla, delete his company's Facebook account. Later in the same year, the company notified over 50 million of its users that third parties had acquired their information through the View as an option. This allowed third parties to acquire information about Facebook users that was not made public.

Consequently, this proved to be a security threat to the users as their areas of residence became public information. In December of the same year, there was chatter that Facebook had allowed over 150 of the most popular companies to access its user data for monetary compensations. These companies would use this information to establish the demography of the population. This information would then be used by the organizations in designing their products to fit the needs of the customers. This continued breach of trust by Facebook by sharing private data with third parties resulted in the argument that the company's business model is based on selling user data. For this reason, the company has been identified as a threat to privacy globally. According to this article, the company outdid itself when it revealed information about patients suffering from certain conditions to insurance companies. These individuals had been lured into providing this information through anonymous surveys and closed groups. However, the company used this information for financial gain by allowing insurance companies access to it. The extends to which this company is willing to go to risk the security of its users by sharing private information is still unknown. However, as part of the company's privacy policies in terms of use, the user allows the company to use their information for free. However, since most people do not read the terms of use, then the company is legally cleared to use this data as it pleases. The only question surrounding this issue is how ethical it is.

Another global issue facing Facebook pertains to hate speech, manipulation, and other forms of misconduct. Unlike other social media platforms that prohibit sharing of sensitive information, Facebook has no such policy. This means that users of the platform can publish incorrect information on the platform without facing any consequences. This has given room to some hateful members of the public to perpetrate cyberbullying. Without actual consequences for cyberbullies, this platform has allowed these grotesque members of society to thrive. Furthermore, the platform allows individuals to pass on the hateful message about society members considered different. For instance, the comment sections on Facebook posts about controversial matters are always filled with abusive language and deadly incitements. The company CEO acknowledges that these issues are present in his company and that they would take years to get fixed. By not policing content shared by its users, this company has, in a big way, contributed to more conflict in the world.

Internet regulations also impact on the global operations of this company. Different countries and regions have different regulations intended to protect their general public from exploitation by telecommunication companies such as Facebook. An example of a case in which these internet regulations affected the operations of Facebook was in 2015 when the EU pushed to prevent the company from sending data acquired from EU companies from being sent to the US. According to the European Union, the United States was not as concerned with the security of this data as the EU would be. Additionally, through the EU's General Data Protection Regulation, which was launched in 2018, all companies acquiring data from EU members were required to seek explicit permission from the user before acquiring such data. The regulation provided that companies such as Facebook and Google would need to describe the purpose for which the data they intend to collect would be used in sufficient detail. Additionally, only upon being granted permission by the users would these companies use said data. Other countries like Germany, the UK, and Canada have also expressed their concerns about how Facebook has accessed certain data without authorization and are still determining ways to hold the company accountable for these actions.

Risks

The largest global risk affecting Facebook is competition from other social media platforms. Other social media platforms, such as Snapchat, have become the greatest competition on Facebook. In the recent past, Snapchat has become a popular social by providing a higher level of privacy compared to Facebook. Owing to the increased level of privacy maintained by this platform, it has begun gaining popularity among users 35 years and older. Before this was determined, Snapchat was only popular among tweens and teens. Additionally, the company has attempted to establish an enterprise social network through two platforms, namely, workplace by Facebook and jobs on Facebook. These platforms have, however, been trampled upon by LinkedIn, which has become the epitome of connecting potential job seekers to their employers. Finally, the similarity between Facebook and Twitter has resulted in the two platforms competing for users and content. As a result, both companies have had to contend with losing users to the other.

Benefits

One of the main benefits that the company enjoys from its current business model is data acquisition. As it stands, anybody can join Facebook for free. This means that as more people join the platform, the company continues to acquire more data, which is then used to improve the experience for these users. In addition to using this data to improve the social experience for the more users the company gets, the more enticing it becomes an advertisement platform. In so doing, more companies become willing to market their products through the platform as it ensures them of reaching a wide range of potential customers. Another benefit that this company enjoys from its business model is the ability to use user data without compensating the owners of the data. When signing into Facebook, an individual is required to provide a ton of information such as name, age, gender, email address, IP address, phone number, GPS data, device information, among other types of data. Once the company collects this information, it is allowed to use it in whichever way it deemed relevant. For instance, granting the application access to contact lists could be used to establish a list of people you may know. Additionally, such information could be used by the company to establish the political affiliations of an individual and use the information to manipulate the individual. This was experienced during Brexit and the 2016 US Presidential elections.

Moreover, the company enjoys the benefit of data monetization. The company o to enjoy financial benefits that came with selling this information to third parties. These sales of mined private data have proven to be a steady source of undisclosed income for this company. For example, advertisers are allowed to pay Facebook to have their advertisements on the platform targeted to the most appropriate audience. This means that if an individual has enough money, they can pay this company to pass on the information to the public. Since Facebook is against the monitoring of user posts, some of these adverts may be deceiving. For instance, there have been several circulating ads claiming to have a cure for HIV/AIDS. Allowing such advertisements to reach people suffering from this disease, yet they are untrue, is not only immoral but inhuman. However, as long as the company was being paid for these ads, it was willing to look the other way and let desperate people continue getting scammed. In addition to this, the company has established several marketing and advertisement products. In doing so, different individuals and companies can advertise their products based on their financial capacity. Furthermore, these products use cookies that track the activity of an individual on the internet. Using information such as search history, the suppliers can determine which products an individual is interested in. This makes it easier to get to these individuals as the targeted market for the products and services in question. Through the platform’s algorithms, allows the company to determine the popularity of a user based on the level of interaction on their posts. Individuals with most likes and comments on their posts are deemed to be popular and thus a priority in targeted marketing. Convincing such an individual to purchase a product could translate to more customers learning about the product through the individual’s positive feedback about the product.

Strategic recommendations

Having established the various ways through which the business model applied by Facebook impacts on the operations of the company globally, recommendations for the best way forward can then be deduced. One of the most crucial factors to consider when establishing a strategic way forward for the company is the level of mistrust surrounding the company's handling of personal data. For this reason, the company no longer needs to apply discrete replies to the data mining and sharing issues that have faced the users as it has in the past. On the contrary, instead of putting out security breaches as they arise, the company could restructure its business model to prevent these breaches from happening beforehand. One way through which this can be achieved is by Zuckerberg and his team reanalyzing the business platform for areas of security concern. These loopholes can then be plugged, creating a system not easily manipulated by third parties for user information. Finally, Facebook should be willing to put the security of its users above the need to dominate the social networks and the world at large. Applying business ethics in the management of this company will eliminate any potential need to sell user data for financial gain.