1/ We'll start by discussing the prep from lesson 15, where you were asked to think about: privacy and how it might be changing; frictionless sharing and social apps; Facebook's timeline.
2/ Facebook recently launched their IPO (stock market offering).
Documents filed with the US Securities and Exchange Commission (SEC) claimed that it had a staggering 845 million active monthly users, half of whom sign in every day, $3.7bn in annual revenue and a rocketing growth rate. It also has a very healthy profit margin of 27%, just above fellow internet giant Google. This is a company that seems to give the final lie to the image of tech firms as coming prematurely to market with more in the way of wild dreams than a solid balance sheet. Guardian
Some think the company could be valued at as much as $100bn.
To justify the kind of valuation that Facebook is seeking, the company is going to have to generate a lot more revenue that they currently do. … even if Facebook gets to 3 billion users, if it doesn't increase its revenue per user, the company will only generate $13 billion in revenue per year … there is only one strategic direction for Facebook to go. It needs to generate more revenue per user. A lot more. … Two things are likely to happen: … 1) A lot more advertising. … 2) More Facebook Payments. … My guess is that Facebook's need to monetize at higher levels and users' desires will come into conflict more often the higher its revenue per user climbs.
As Wired noted, "With a huge new source of personal information, Facebook can now serve some of [the] most micro-targeted ads in history. You could probably call them nano-targeted ads." And the FT reported this February that advertising will come to Facebook on mobile devices 'within weeks'.
Some commentators have questioned the accuracy of Facebook's own estimate of the number of active users it has: "Facebook appears to be using the term “active” as a euphemism for “engaged” rather than how many users are actually going to its site every month" — NYT. From the same article:
Facebook’s “Like” button on third-party sites or through “Facebook Connect” — its platform allowing users of other Web sites to sign in through Facebook and share information — is valuable, even if it isn’t easily monetized. … All of those “Likes” help Facebook create a treasure trove of data that should make its ability to target advertising to its users all the more valuable. (Of course, some people will be unnerved by how much Facebook knows about them.)
… in the last year or so, financial institutions have started exploring ways to use data from Facebook, Twitter and other networks to round out an individual borrower’s risk profile—although most entrepreneurs working on the problem say the technology is three to five years away from mainstream adoption.
- The company compiles tracking data in different ways for members who have signed in and are using their accounts, for members who are logged-off and for non-members. The tracking process begins when you initially visit a facebook.com page. If you choose to sign up for a new account, Facebook inserts two different types of tracking cookies in your browser, a "session cookie" and a "browser cookie." If you choose not to become a member, and move on, you only get the browser cookie.
- From this point on, each time you visit a third-party webpage that has a Facebook Like button, or other Facebook plug-in, the plug-in works in conjunction with the cookie to alert Facebook of the date, time and web address of the webpage you've clicked to. The unique characteristics of your PC and browser, such as your IP address, screen resolution, operating system and browser version, are also recorded.
- Facebook thus compiles a running log of all your webpage visits for 90 days, continually deleting entries for the oldest day and adding the newest to this log.
3/ It has become important to understand how our data is used on the web and internet and by the services we use. We've looked at privacy, tracking and how to find search results in ways that don't prefer those on any given company's network or service.
Facebook is close to a settlement with the Federal Trade Commission over charges that it acted in a deceptive manner in regards to its privacy settings, according to reports from The Wall Street Journal. The settlement would require Facebook to receive user consent before making "material retroactive changes" to its privacy settings. It would also require independent privacy audits for the next 20 years.*
* (more on this just below)
The Federal Trade Commission (FTC) said Facebook had made claims about its privacy policies that were "unfair and deceptive, and violated federal law." … The FTC said it had reached a proposed settlement with Facebook that would force it to obtain consent before making changes to privacy settings. The firm will also have to undergo an independent audit of its consumer privacy policy every two years for the next 20 years, to make sure it complies with the FTC ruling. … In future, the firm will be required to obtain consent from its users ahead of making changes that change their privacy settings, and it will be required to prevent anyone from accessing a Facebook user's account 30 days after they have deleted it. — Guardian, Facebook reaches deal with FTC over 'unfair and deceptive' privacy claims (November 2011).
Facebook has been told to stop its practice of indefinitely retaining data about which adverts its 500 million users outside the US click on, following a review by the Irish data protection commissioner of its non-US operations. It has also agreed to take immediate steps over data collected from third-party sites when people use their Facebook identity to log in to them. Until now, that data about people's behaviour was passed back to Facebook and retained indefinitely. Following the review, Facebook can keep the data but it has to make it anonymous – for example it can share how many people clicked on an advert but can't provide details of specific users – within 10 days and completely delete the data after 90. The social network has also been told to improve users' control over social adverts, and simplify its explanations of its privacy policies which must also be made more prominent for new users, following a detailed report by the commissioner. — Guardian, Facebook told to stop indefinitely holding users' advertising data (December, 2011)
… we don’t always get everything right. The launch of Google Buzz fell short of our usual standards for transparency and user control—letting our users and Google down. While we worked quickly to make improvements, regulators—including the U.S. Federal Trade Commission—unsurprisingly wanted more detail about what went wrong and how we could prevent it from happening again. Today, we’ve reached an agreement with the FTC to address their concerns. We’ll receive an independent review of our privacy procedures once every two years, and we’ll ask users to give us affirmative consent before we change how we share their personal information. — Official Google blog, An update on Buzz (March 2011)
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