NAfter a series of investigative reports, Facebook CEO Mark Zuckerberg defended his company with vehemence. In a conference call after the quarterly figures were presented on Monday, he spoke of a “coordinated effort” to paint a “wrong picture” of Facebook. A few hours earlier, the former Facebook employee Frances Haugen, who was the source for these reports and brought internal documents to light, appeared before a committee of the British Parliament and once again called for stricter regulation of the Internet giant.
Facebook is facing this turbulence amid a slowdown in its business, as the quarterly report revealed. The group reported lower than expected sales for the past three months and was cautious about the rest of the year. He made “considerable uncertainty” around Apple’s new data rules partly responsible for his cautious forecast.
The new Apple guidelines hinder the collection of user data that is relevant to the advertising business. Managing Director Sheryl Sandberg said it was harder to target advertising to individual users and to measure the success of advertising campaigns. A few days ago, Snap, the parent company of Snapchat, blamed Apple’s changed conditions for weaker than expected numbers, so the news from Facebook was not entirely surprising. After the hours of trading, the share price was initially even slightly higher
Haugen takes politics to its duty
Overall, the group reported a sales growth of 35 percent to 29.0 billion dollars for the third quarter, analysts had expected an average of 29.6 billion dollars. In the second quarter, growth was still 56 percent, after which Facebook had already warned of a slowdown in the rest of the year. For the final quarter, the company is only forecasting an increase in sales of between 12 and 21 percent. In addition to Apple’s new rules, Facebook also cited macroeconomic and pandemic-related factors as obstacles to its business.
Facebook increased its net profit in the past quarter by 17 percent to 9.2 billion dollars. Earnings per share of $ 3.22 were slightly higher than analysts expected.
The business results came a few hours after the hearing with Haugen in London. The whistleblower appeared before the American Congress a few weeks ago. She says Facebook is well aware of the risks of its platforms, but the company is doing little about it. In the past few days there have been a number of other media reports based on internal Facebook documents that Haugen has brought to the public. Among other things, it was about the spread of misinformation about the US presidential election last year and the storming of the Capitol on January 6, as well as the consequences of hateful comments on Facebook in India.
Speaking to the UK Parliament, she said in response to her call for stricter regulation: “If the incentives don’t change, Facebook won’t change.” She also said Facebook’s often-cited statistics on how much harmful content was removed from its platforms , did not reflect reality. The company is “very good at dancing with data”. Haugen also alluded to Facebook’s latest announcement that 10,000 jobs would be created in Europe in order to advance Zuckerberg’s strategy around the development of a so-called “Metaverse”.
The Facebook boss means a kind of virtual space and describes it as “the next generation of the Internet”. Haugen now suggested that Facebook should use these places to make its services more secure. In contrast, Zuckerberg said on Monday that any “honest account” from Facebook must take into account that the company has made tremendous strides. No other company in the industry combats harmful content as “effectively” as Facebook.
Name change this week?
In the midst of all the controversy, Facebook is apparently considering a symbolic change. According to media reports, the company plans to announce its name change this week. Facebook’s eponymous regular service would then be just one of many products.
Nothing was said on Monday about a possible renaming. However, the company announced that it wanted to change its financial reporting. In future, it wants to show results for two business pillars separately from one another: On the one hand, it should be the “family of apps”, which includes Facebook’s regular service as well as platforms such as Instagram, Messenger and Whatsapp. In addition, the – presumably much smaller – category “Facebook Reality Labs” will be available in the future. This includes activities related to virtual reality (“Virtual Reality”) and expanded reality (“Augmented Reality”), which Zuckerberg also sees as important building blocks in his “Metaverse” vision. Other hardware products should also be in this group. For example, Facebook recently launched computer glasses together with the Ray-Ban eyewear brand.
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