Sheryl Sandberg testifies before a Senate Intelligence Committee hearing.
Photograph by Jim Lo Scalzo/EPA-EFE/REX/Shutterstock.
To hear Mark Zuckerberg and Sheryl Sandberg tell it, things at Facebook are just wonderful. Wonderful! “There are now 2.7 billion people who, on a monthly basis, are using at least one of our services,” Sandberg told CNBC’s Julia Boorstin on Wednesday after the company reported a record profit of $6.88 billion in the recently closed quarter. More importantly, Sandberg emphasized, “the community that uses Facebook is growing; we’re at 2.3 billion every month, with 66 percent coming back every day.”
Why, you might ask, are all those people using Facebook and its other products so much? Because, as Sandberg repeated over and over, Facebook cares very much about “safety and security.” In her choreographed televised interviews on Wednesday, Facebook’s chief operating officer repeatedly uttered this phrase—“safety and security”—as if she was trying to perform some sort of Jedi mind trick. With revenue at an all-time high, Sandberg seemed to suggest, it might even be time to turn the page on Facebook’s various disturbing scandals. “We had a strong quarter,” she explained, “and I think it was an end to a really important, challenging year at Facebook.”
Of course, the real reason Facebook posted a mind-boggling profit has less to do with corporate buzzwords than how Facebook has systemically crushed its competition in Silicon Valley. Back in 2012, I was working on a story at The New York Times about how Facebook could make or break a rival app on its platform. Back then, most app developers were opting to integrate with Facebook, since it allowed them to piggyback off an existing social network to find new users. But it also gave Facebook a “Spidey Sense,” as sources told me at the time, regarding which apps were taking off—and which might need to be put down. In the case of Instagram, that sixth sense led Mark Zuckerberg to make a $1 billion acquisition offer—a brilliant, prescient bet on a company that’s now valued at $100 billion. Months later, Facebook acquired a Tel Aviv-based start-up, Onavo, that gave them even more insight into what users were doing on their phones. After studying the data, Facebook reportedly decided to buy another potential competitor: WhatsApp.
Jonathan Zittrain, a professor at Harvard Law School and a co-founder of the Berkman Center for Internet and Society, told me years ago that, “Facebook has so much power online that they have the ability to buy something at a low price and then make it go high by directing traffic accordingly. Sociologically, this is called the Matthew effect”—a reference to the Gospel of Matthew—“where the rich get richer and the poor get poorer.” Zittrain’s theory underlies the power, the insight, that differentiates Facebook—and may give it ability to use special tactics to hack growth. In some instances, Facebook can copy a hot start-up, as we saw when Facebook first observed Snapchat’s popularity among high-school students in Los Angeles in its seminal days. In other instances, Facebook simply stops showing a competitor in its News Feed, as we’ve seen happen over the years with competing video sites and services on the platforms.
The same tools and data manipulation can, of course, be used to egg on user engagement, monthly active users, and other growth statistics on Facebooks own platform. Early research into psychographics, the same type of data research used by Cambridge Analytica, found that if a computer algorithm knew just a few dozen data points about you, the model could know your political affiliation, sexual tendencies, even your ethnicity. When the Cambridge Analytica data scandal broke open last year, it became clear that the company had been using as many as 5,000 data points to target voters in ways that tapped into their deepest fears, even knowing which color ads they were more likely to click on. Now, imagine the kind of data that Facebook has collected about people who have been on the platform for over a decade. Likely tens of thousands, if not hundreds of thousands, of data points about us. And it’s no stretch to realize that Facebook can use that information whenever, and however, it wants, enticing us to engage in ways our puny little brains can’t even comprehend.
Despite Sandberg’s proclamation that Facebook had put its bad year behind it with a record quarter, it’s also possible that the company used its data arsenal to optimum effect in order to appease stockholders and re-write its narrative. In reality, the company’s rising revenue is up, because, as David Kirkpatrick, author of The Facebook Effect, surmised on Bloomberg TV, “The numbers are going to be great because advertisers really don’t have a place to go.”
While Sandberg was delivering her lines into TV cameras, her boss was echoing her on the company’s quarterly earnings call, focusing not on the company’s woes, but on all the cool products that Facebook is developing to make the world an even better place. “I’m talking about major improvements to people’s lives that whole communities recognize and say, ‘Wow, we’re all doing something new on Facebook or on WhatsApp that we weren’t doing before,’” Zuckerberg said on the call.
In many respects, the Sandberg-Zuckerberg script is borrowed from the Donald Trump playbook. When something goes wrong, either blame someone else—such as the media or George Soros—or elide over it, as if it didn’t happen. Facebook’s latest earnings very briefly acknowledged the company’s two plus years of investigations, fake news, data breaches and more. It was as if Zuckerberg and Sandberg we’re driving us along the freeway, and they slammed on the gas the moment we passed things they don’t want us to see, reverting the conversation to Facebook’s many splendors. How wonderful it is for investors. How wonderful it is for advertisers. How wonderful it is to work there. And how wonderful Facebook is for the planet.
A few months ago I asked a Silicon Valley executive if Sandberg would step down over the controversies surrounding Facebook. And you know how that person responded? They laughed at my question. A bellowing, are you serious laugh. “No fucking way,” they said. “In the same way Elon Musk kept his job after he lied about Tesla going private, in the same way Jack Dorsey has kept his job after all the bots were discovered on Twitter, in the same way that they all keep their jobs, Sheryl isn’t going anywhere. Facebook and its executive team are going to sail right through this controversy and act like nothing ever happened.” It turns out, the executive was right.
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