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100 GlobeAsia November 2012
Technology By Jason Fernandes
acebook, a company that
didn’t even exist a decade
ago, just crossed the one
billion user mark. With
over a billion users posting
pictures, commenting, messaging and
sharing web pages, the site could well
represent a profound evolution in the
human experience.
Over 140.3 billion friendships
have been made or cemented in
digital space, signaling a fundamental
and irreversible shift in how society
communicates in the 21st century.
Whether these changes are positive
or negative is still hotly debated. The
fact remains however that people no
longer expect the kind of privacy and
anonymity they enjoyed just a few
short years ago. Today, well into the
age of Facebook, the question is worth
asking: is privacy obsolete?
People who use the service have
realized that it is for all intents and
purposes a living organism that self-
perpetuates and evolves as more people
interact with it. While previously
one would meet a person at a party
and vaguely recall having met them
before, in the age of Facebook a digital
meeting will simultaneously result in
a list of mutual friends, allowing both
individuals to immediately place where
they met, and through whom.
What was previously a vague
human experience that involved fading
memories and facial recognition is
now instant and measurable in the
digital world. A quintessentially human
interaction is thus digitized and where
advertisers relied on word of mouth
they now rely on Facebook ‘likes’.
Because these digital interactions
all take place on Facebook, the massive
accumulation of data is a boon to
businesses. Advertisers have learned that
a recommendation from a friend or even
acquaintance carries much more weight
than most ads ever could. This does
bring up some controversial questions
however, with privacy advocates asking:
At what point does Facebook’s sharing
of its users’ data become intrusive? The
Facebook model itself is inevitably at
odds with information privacy.
In the recent past, Facebook has
attempted to monetize its massive user
base by introducing ad programs such
as ‘sponsored stories’. The program ran
afoul of California law as it used the
names and likeness of users without
compensation and without providing
them a way to opt out of the program.
On October 8 Facebook proposed
a $20 million settlement to users
affected by the ‘sponsored stories’
fiasco and offered users a way to refuse
participation in the program.
The sharing of information and
pictures between friends increases the
value of the site to other users, resulting
in more frequent visits to the site and
a correspondingly greater audience for
advertisers.
Advertising relevance
Another ad product from Facebook,
Social Ads, consists of brand-created
messages appended with unique user
information that serve to make the ad
more effective. While Facebook doesn’t
provide this personal information
to advertisers, both advertisers and
Facebook clearly benefit when users
choose to engage with the network more
often and/or on a deeper level, foregoing
their privacy concerns along the way.
While Facebook is free for users,
its ad-supported model means that
advertisers are wholly dependent on
user data to target their ads to the right
people. This isn’t necessarily a bad thing
for the average user because not only
are ads based on their interests more
likely to result in a sale for the advertiser,
they also improve the experience for the
end users who are not bombarded by
irrelevant or out-of-context ads.
Companies realize that while the
number of ‘likes’ their page receives is
a good metric of brand recognition, it
does not exactly give them data on how
those ‘likes’ or ad views translate to sales.
To address this issue, Facebook recently
announced a partnership with Datalogix
aimed at quantifying how often
Facebook users view an advertisement
on the website and then go on to buy the
advertised item in a brick and mortar
store. The plan involves tracking the
purchases of over 100 million households
at over 1,200 retailers.
If this all seems a little Orwellian
to you, you’re not alone. Predictably
both the Center for Digital
Democracy as well as the Electronic
Privacy Information Center have
moh.defrizal
Did Facebook
kill privacy?
102 GlobeAsia November 2012
Technology
already requested the Federal Trade
Commission investigate whether this
is permitted in light of a settlement
recently finalized by Facebook.
There seems to be a perennial tug
of war between privacy advocates
and Facebook. Facebook is constantly
experimenting with new revenue
streams and seems to be always
running into criticism for privacy
violations. The problem for the
company is that it’s so popular
that everything it does is minutely
scrutinized. How does it continue to
maintain its explosive growth and
justify its huge valuation without
alienating the very users it depends on
to maintain its popularity? 
For the folks at Facebook, there
seems to be no easy answer to this
question. Ultimately in order to survive,
the task before them is nothing less than
a complete change in the way society
views privacy in the 21st century.
Fortunately for Facebook, there is some
evidence that this is already happening.
Concept of privacy is evolving
A 2011 study conducted by the
Ponemon Institute for msnbc.com 
revealed that people’s views regarding
privacy have been polarized just over
the past few years. While five years ago
most respondents felt that privacy was
slipping way, and that it bothered them,
today 36% said that privacy was less
important. Surprisingly, the exact same
number responded that it had grown
more important. Why has the last few
years resulted in such a binary view of
privacy?
The interesting part of the findings
was that the differentiator between
the two groups was social media. The
people who used social media were
less bothered about the possible loss of
privacy. The study indicated that these
respondents had a lower expectation
of privacy and views held by the other
36% might actually seem antiquated to
denizens of the digital age.
We are entering a new era where
given our fast-paced and increasingly
globalized world, the only way for
people to stay connected is through
social media and users realize that social
media is only as useful as they make it.
Of course it’s the very existence
of the ads on the website that allow
Facebook to exist at all. Most users
know all this, and their continued use
certainly indicates that they feel like
this is an acceptable trade-off.
Founder Mark Zuckerberg appears
to be well aware of these changing values.
Indeed in an interview with Michael
Arrington of TechCrunch a whole year
before the msnbc study, Zuckerberg said
“People have really gotten comfortable
not only sharing more information and
different kinds, but more openly and
with more and more people. That social
norm is just something that has evolved
over time.” Citing the popularity of blogs
and “different services that have people
sharing all this information,” he suggests
that Facebook is simply going with the
changing tide as opposed to making the
waves.
A fair trade
The idea of trading control for
convenience is not a novel concept.
Having a bank account or registering
your bank account with a utility
company for example has always
required a certain degree of trust that
the information will not be misused.
Like it or not, we depend on an
intricate network of people including
customer service reps, bank and
company employees, essentially hoping
for an unbroken chain of custody for
our confidential information. Even
given the safeguards, we are nonetheless
aware that certain individuals are going
to have access to financial information.
We relinquish our right to absolute
control in favor of the convenience of a
bank account or automatic bill payment.
In the digital world, things aren’t much
different. People relinquish their right
to privacy for the convenience of easily
staying connected with their friends and
family.
This is tumultuous new territory
and everyday it seems like there is a new
controversy regarding some possible
new privacy violation. Eventually people
will develop a more laissez-fair attitude
towards non-crucial informational
privacy while realizing they need to
be more vigilant about more sensitive
information they may want to avoid
posting on social networking websites.
A delicate balance will have to be
maintained wherein users are mindful
that the value of Facebook is in how
they interact with it. Similarly and by the
same token, Facebook will have to learn
how to maintain user privacy and not
betray their trust while still maintaining
a sustainable business model.
Privacy as we know it could well
be an antiquated concept. We live in a
world with a 24/7 news cycle and we
are increasingly aware that nothing
we release into the world is ever
really private. Celebrities and non-
celebrities alike constantly come across
embarrassing photos and videos posted
online by former friends and romantic
partners.
Life in the internet age is a life lived
under a microscope and the sooner
society comes to grips with that, the
sooner a new equilibrium can develop.
Things will eventually settle and the
boundary between what’s acceptable
and what’s not will be more clearly
drawn. Until we reach this ‘new
normal’ however, we ought to strap in
tight, because it’s going to be a long and
bumpy ride.
Jason Fernandes is a tech commentator
and founder of SmartKlock.

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Did facebook kill privacy

  • 1. 100 GlobeAsia November 2012 Technology By Jason Fernandes acebook, a company that didn’t even exist a decade ago, just crossed the one billion user mark. With over a billion users posting pictures, commenting, messaging and sharing web pages, the site could well represent a profound evolution in the human experience. Over 140.3 billion friendships have been made or cemented in digital space, signaling a fundamental and irreversible shift in how society communicates in the 21st century. Whether these changes are positive or negative is still hotly debated. The fact remains however that people no longer expect the kind of privacy and anonymity they enjoyed just a few short years ago. Today, well into the age of Facebook, the question is worth asking: is privacy obsolete? People who use the service have realized that it is for all intents and purposes a living organism that self- perpetuates and evolves as more people interact with it. While previously one would meet a person at a party and vaguely recall having met them before, in the age of Facebook a digital meeting will simultaneously result in a list of mutual friends, allowing both individuals to immediately place where they met, and through whom. What was previously a vague human experience that involved fading memories and facial recognition is now instant and measurable in the digital world. A quintessentially human interaction is thus digitized and where advertisers relied on word of mouth they now rely on Facebook ‘likes’. Because these digital interactions all take place on Facebook, the massive accumulation of data is a boon to businesses. Advertisers have learned that a recommendation from a friend or even acquaintance carries much more weight than most ads ever could. This does bring up some controversial questions however, with privacy advocates asking: At what point does Facebook’s sharing of its users’ data become intrusive? The Facebook model itself is inevitably at odds with information privacy. In the recent past, Facebook has attempted to monetize its massive user base by introducing ad programs such as ‘sponsored stories’. The program ran afoul of California law as it used the names and likeness of users without compensation and without providing them a way to opt out of the program. On October 8 Facebook proposed a $20 million settlement to users affected by the ‘sponsored stories’ fiasco and offered users a way to refuse participation in the program. The sharing of information and pictures between friends increases the value of the site to other users, resulting in more frequent visits to the site and a correspondingly greater audience for advertisers. Advertising relevance Another ad product from Facebook, Social Ads, consists of brand-created messages appended with unique user information that serve to make the ad more effective. While Facebook doesn’t provide this personal information to advertisers, both advertisers and Facebook clearly benefit when users choose to engage with the network more often and/or on a deeper level, foregoing their privacy concerns along the way. While Facebook is free for users, its ad-supported model means that advertisers are wholly dependent on user data to target their ads to the right people. This isn’t necessarily a bad thing for the average user because not only are ads based on their interests more likely to result in a sale for the advertiser, they also improve the experience for the end users who are not bombarded by irrelevant or out-of-context ads. Companies realize that while the number of ‘likes’ their page receives is a good metric of brand recognition, it does not exactly give them data on how those ‘likes’ or ad views translate to sales. To address this issue, Facebook recently announced a partnership with Datalogix aimed at quantifying how often Facebook users view an advertisement on the website and then go on to buy the advertised item in a brick and mortar store. The plan involves tracking the purchases of over 100 million households at over 1,200 retailers. If this all seems a little Orwellian to you, you’re not alone. Predictably both the Center for Digital Democracy as well as the Electronic Privacy Information Center have moh.defrizal Did Facebook kill privacy?
  • 2. 102 GlobeAsia November 2012 Technology already requested the Federal Trade Commission investigate whether this is permitted in light of a settlement recently finalized by Facebook. There seems to be a perennial tug of war between privacy advocates and Facebook. Facebook is constantly experimenting with new revenue streams and seems to be always running into criticism for privacy violations. The problem for the company is that it’s so popular that everything it does is minutely scrutinized. How does it continue to maintain its explosive growth and justify its huge valuation without alienating the very users it depends on to maintain its popularity?  For the folks at Facebook, there seems to be no easy answer to this question. Ultimately in order to survive, the task before them is nothing less than a complete change in the way society views privacy in the 21st century. Fortunately for Facebook, there is some evidence that this is already happening. Concept of privacy is evolving A 2011 study conducted by the Ponemon Institute for msnbc.com  revealed that people’s views regarding privacy have been polarized just over the past few years. While five years ago most respondents felt that privacy was slipping way, and that it bothered them, today 36% said that privacy was less important. Surprisingly, the exact same number responded that it had grown more important. Why has the last few years resulted in such a binary view of privacy? The interesting part of the findings was that the differentiator between the two groups was social media. The people who used social media were less bothered about the possible loss of privacy. The study indicated that these respondents had a lower expectation of privacy and views held by the other 36% might actually seem antiquated to denizens of the digital age. We are entering a new era where given our fast-paced and increasingly globalized world, the only way for people to stay connected is through social media and users realize that social media is only as useful as they make it. Of course it’s the very existence of the ads on the website that allow Facebook to exist at all. Most users know all this, and their continued use certainly indicates that they feel like this is an acceptable trade-off. Founder Mark Zuckerberg appears to be well aware of these changing values. Indeed in an interview with Michael Arrington of TechCrunch a whole year before the msnbc study, Zuckerberg said “People have really gotten comfortable not only sharing more information and different kinds, but more openly and with more and more people. That social norm is just something that has evolved over time.” Citing the popularity of blogs and “different services that have people sharing all this information,” he suggests that Facebook is simply going with the changing tide as opposed to making the waves. A fair trade The idea of trading control for convenience is not a novel concept. Having a bank account or registering your bank account with a utility company for example has always required a certain degree of trust that the information will not be misused. Like it or not, we depend on an intricate network of people including customer service reps, bank and company employees, essentially hoping for an unbroken chain of custody for our confidential information. Even given the safeguards, we are nonetheless aware that certain individuals are going to have access to financial information. We relinquish our right to absolute control in favor of the convenience of a bank account or automatic bill payment. In the digital world, things aren’t much different. People relinquish their right to privacy for the convenience of easily staying connected with their friends and family. This is tumultuous new territory and everyday it seems like there is a new controversy regarding some possible new privacy violation. Eventually people will develop a more laissez-fair attitude towards non-crucial informational privacy while realizing they need to be more vigilant about more sensitive information they may want to avoid posting on social networking websites. A delicate balance will have to be maintained wherein users are mindful that the value of Facebook is in how they interact with it. Similarly and by the same token, Facebook will have to learn how to maintain user privacy and not betray their trust while still maintaining a sustainable business model. Privacy as we know it could well be an antiquated concept. We live in a world with a 24/7 news cycle and we are increasingly aware that nothing we release into the world is ever really private. Celebrities and non- celebrities alike constantly come across embarrassing photos and videos posted online by former friends and romantic partners. Life in the internet age is a life lived under a microscope and the sooner society comes to grips with that, the sooner a new equilibrium can develop. Things will eventually settle and the boundary between what’s acceptable and what’s not will be more clearly drawn. Until we reach this ‘new normal’ however, we ought to strap in tight, because it’s going to be a long and bumpy ride. Jason Fernandes is a tech commentator and founder of SmartKlock.