5 Things To Learn From Mark Zuckerberg’s Congressional Testimony

Facebook CEO Mark Zuckerberg spent several hours answering questions from dozens of U.S. senators in Washington, D.C. The questions varied from explaining the basics of ad-tech to answering whether Facebook would support bills strengthening privacy laws.

Zuckerberg’s testimony before Congress comes nearly a month after Facebook banned the British data firm Cambridge Analytica after it allegedly improperly accessed the data of as many as 87 million users. Questioning is expected to continue for another couple of hours with another entire day of testimony scheduled for Wednesday before the House of Representatives.

Some lawmakers are considering regulation

Several lawmakers today suggested Facebook might need to be regulated in order to protect consumers’ privacy. While some suggested that Facebook needs to prove it can regulate itself, others tried to get Zuckerberg to commit to supporting future legislation that would let users opt in to providing data rather than its current opt-out model. One example of that is the proposed CONSENT Act, introduced today by U.S. Sen. Ed Murkey. The bill would require opt-in consent from users before a company could use, share or sell personal information. It would also require companies to notify users of all data collected and shared and notify them if there’s ever a breach. Zuckerberg said he agrees in general with some regulation and even offered to provide a list of ways it might make sense.

Lawmakers don’t all understand how Facebook works

A lot of questions today revolved around how data is collected, used or deleted. Several lawmakers suggested Facebook sells user data, but Zuckerberg said the company doesn’t. Zuckerberg and lawmakers were often at odds about the idea of how users are able or not able to consent to how their data is used.

Robert Mueller has questioned Facebook

Zuckerberg was asked if anyone at Facebook had been subpoenaed or interviewed by special counsel Robert Mueller’s team, which is currently investigating Russian interference in the 2016 election. At first, Zuckerberg briefly hesitated before saying yes. He then clarified that he wasn’t sure about the subpoenas but confirmed some employees had been interviewed. (He said he was not among those interviewed.)

Facebook hasn’t thrown out the idea of a paid model

At least two lawmakers followed up on COO Sheryl Sandberg’s comments last week suggesting that Facebook would need a paid model if users want to opt out of ads. Zuckerberg did not directly answer whether it’s currently exploring a paid model. However, he didn’t totally shut down the idea, saying there will “always be a version” of the platform that’s free to use.

Wall Street was happy with Zuckerberg’s performance
While some wondered how the interview-averse Zuckerberg might perform in front of a few dozen lawmakers, Facebook’s stock price jumped during the hearing, increasing 4.5 percent to close at $164.98 per share.

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More Than $1B in Fines Loom in Facebook Scandal

As Mark Zuckerberg prepared for his Tuesday Senate testimony and Wednesday House hearing, The Washington Post reported there’s a call for the Facebook CEO’s ouster and that record fines may loom for the embattled social media giant. (For full coverage of Zuckerberg’s Tuesday appearances before the Senate Commerce and Judiciary Committees, click here and here.)

The Post reports that Scott Stringer, New York City’s comptroller and custodian of the city’s $193 billion pension fund, which holds $895 million in Facebook stock, wrote a letter March 27 pushing Facebook to add three new independent directors and replace Zuckerberg with an independent chairman.

“Part of my fiduciary role is to ask questions of this company as it relates to issues they’re facing,” said Stringer in an interview last week about his letter. Regarding the Cambridge Analytica revelations, he said, “There’s regulatory risk. There’s revenue risk. There’s reputational risk. And there’s also a genuine risk to our democracy.”

The paper also reports that three former Federal Trade Commission (FTC) officials said Facebook’s disclosure that its search tools were used to collect data on most of its 2.2 billion users could potentially trigger record fines and create new legal vulnerability for not having prevented risks to user data.

Those officials, all of whom were at the FTC during the privacy investigation that led to a 2011 consent with Facebook, said the company’s latest mishap may violate the decree’s provisions requiring the implementation of a privacy program.

But Facebook’s chief operating officer, Sheryl Sandberg, dismissed concerns about the fines in an interview with Bloomberg News, “I think we’re very confident that that was in compliance with the FTC consent decree,” she said.

Still, David Vladeck, who was head of the FTC’s bureau of consumer protection when the decree was drafted and signed by Facebook, told The Washington Post it is possible that this episode is a violation of the consent decree and that Facebook may face fines of $1 billion or more.

“The agency will want to send a signal … that [it] takes its consent decrees seriously,” Vladeck said.

In another blow, Charter Communications Chairman and CEO Tom Rutledge, blogged Monday that he hopes Congress cracks down on Facebook and privacy issues.

“Despite our reliance on websites and social media, the truth is, most people don’t know that when they engage in these activities online, many internet companies are collecting a significant amount of information about them and selling it to others for advertising, research and even voter persuasion purposes,” Rutledge writes. “So we are urging Congress to pass a uniform law that provides greater privacy and data security protections and applies the same standard to everybody in the Internet ecosystem, including us.”

Facebook continues efforts to regain trust. On Monday, it announced a new research initiative with seven nonprofits to study the effect of social media on elections. Under the new initiative, social science researchers will propose research projects for peer review based on a set of general research goals. If a proposal is approved, the researchers will receive the anonymized data from Facebook and accompanying funding from the foundations.

Crucially, Facebook “will not have any right to review or approve their research findings prior to publication,” although it may have influence over which projects are approved.

read more here: responsemagazine.com