When it comes to Mark Zuckerberg’s plan to transform Facebook by emphasizing “privacy-focused” social networking, count Paul Vixie as a skeptic.
The concepts of private and social are, by their nature, at odds with one another, says Vixie, the CEO of Farsight Security. Vixie, who helped create some of the founding technology underlying the internet and has worked for decades on privacy and security issues, is dubious that Facebook will be able to find some middle ground in between them and still be able to have a fast-growing business.
“Private is not social, and social is not private. And so, if you’re doing one, you’re not doing the other,” he said. “Please make up your mind.”
“At the moment, the Venn diagram doesn’t have any overlapping circles,” he continued. “So, I’m not going to say it can’t be done, but I will say that I’m not convinced.”
Zuckerberg laid out his plans to build a “privacy-focused platform” in a blog post earlier this month. As envisioned by Zuckerberg, the new platform will allow users to interact privately via end-to-end encryption. It will also connect the company’s various messaging services, allowing Instagram users to exchange messages with those on WhatsApp or Facebook Messenger. The company plans to reconstruct several of its services with these ideas in mind, he said.
Facebook’s CEO didn’t explain how the company would make money off the its new privacy-centric services, although he suggested that Facebook will build into them the ability for corporations to connect with consumers and for consumers to be able to purchase goods through them. Ostensibly, Facebook would charge companies for such services.
Right now, almost all of the social-networking company’s revenue has come from digital advertising. The ad-targeting machine the company has built has allowed it to build a huge and fast-growing business that has allowed it, along with Google, to dominate the digital advertising industry.
But Facebook may be starting to feel that its advertising efforts are being constrained, Vixie suggested. Under the European Union’s General Data Protection Regulation, which took effect last year, companies such as Facebook can’t collect or share data from European users without first getting their permission.
Indeed, that law illustrates how the concepts and values of “privacy” and “social” are fundamentally opposed, Vixie said. The law seeks to protect European citizens’ privacy by giving them control and ultimate say over their data. In so doing, the law threatens to disrupt the social-networking giant’s advertising business.
For that business, Facebook has collected copious amounts of data about its users, both based on what they post on the site and their interactions off of it. It’s encouraged users to share ever more data about themselves by introducing new social features and has made itself valuable to advertisers by allowing them to access such data to target individuals or groups of users.
But GDPR could preclude Facebook from iterating on that business by widely rolling out new advertising services or other features, Vixie said. Facebook couldn’t offer such features to individual users — at least in Europe — unless and until they agreed, one by one, to allow the company to access and use whatever data it needed for those services, he said.
And it could soon face similar difficulties elsewhere. California last year passed a privacy law that’s similar to GDPR, and other governments are looking at it as a model for their own privacy legislation.
If Facebook has to get every user to click “yes” on a checkbox every time it wants to introduce a new feature, “it would mean that they could no longer operate as a hyper-scale company,” Vixie said, adding that “hyperscale is what lets them have a share price that is such a high multiple of their earnings.”
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