It seems every couple of days brings another scandal for Facebook – yet its profits continue to soar.
On this week’s Tech Tent we ask what it will take to dent the enthusiasm of both users and advertisers for the social media giant.
On Wednesday morning, many people woke up to news of another privacy scandal. It was revealed that Facebook had targeted teenagers with a market research app which saw them hand over lots of personal information in exchange for a monthly fee.
Apple accused Facebook of dodgy dealings with the app, which was distributed to consumers via a platform designed to allow organisations to share private apps with employees. Facebook’s use of this system was curtailed – cue anguish from employees unable to see the lunch menu or the bus timetable.
Meanwhile, a more serious crisis for the company’s reputation was unfolding. Instagram, owned by Facebook, stood accused of failing to protect young people from disturbing content about suicide.
The case of Molly Russell, who took her own life in 2017 at the age of 14, appeared to highlight the dangers of an unregulated social media industry. Molly’s father told the BBC he believed Instagram “helped kill my daughter”.
But then on Wednesday evening Facebook came out with record results – profits up nearly 40%, with 2.7 billion people using its products every month. So why is Facebook’s business not suffering from the scandals?
Research analyst Ryan Doherty, from IHS Markit, tells us that Instagram’s rapid growth is one reason advertisers still love the company: “Instagram Stories hit the 500 million user mark for daily active users,” he explains. “That provides an incredible platform for advertisers in the US and in Europe that’s pretty well unmatched in terms of daily reach.”
Scandals at both Facebook and Google have led advertisers to question whether they are safe places to promote brands. But Emily Bell, director of the Tow Center for Digital Journalism at Columbia University, agrees that in the end their sheer scale is persuasive: “The Google and Facebook platforms are so much cheaper and more efficient in terms of how they profile and how they reach people. The location data that the services have is really unparalleled.”
She says there is a lot of talk from advertisers about wanting a “cleaner information environment” but they haven’t voted with their wallets yet.
That of course might change if the users do begin to get fed up with the product.
Jamie Bartlett, social media researcher and author of The People versus Tech, says there are plenty of anecdotes about people leaving Facebook but the numbers tell a different story
“I think, in the end, despite the frustration that some users have, the convenience of the platform – that sort of social desire to connect with other people and see what other people are doing – means you might switch off for a while, but generally people end up getting sucked back in.”
Perhaps a more imminent danger is regulation. This week saw British MPs call for a new code of practice for social media, with firms like Facebook having a legal duty of care to make sure users under 18 do not come to harm.
The world has fallen out of love with Facebook over the last couple of years. So far that has not affected its bottom line but if a combination of regulators, concerned parents and advertisers unite to demand reform, that could change.