Why Frances Haugen?
Frances Haugen went from an unknown to prominence in the space of a week. Ms Haugen is the whistle blower who collaborated with the Wall Street Journal on a series of stories about Facebook. Her identity became public when she appeared on US programme 60 Minutes. 60 Minutes included allegations of promoting human trafficking and domestic servitude.
One interesting aspect of what Frances Haugen said on the show was that Facebook tackles as little as 3 – 5 percent of online hate and misinformation content, despite being the best in the world at it.
Frances Haugen then appeared before a US senate committee and testified about the effects of Facebook. Finally she complained to the SEC claiming that Facebook has misled shareholders with regards the social network’s appeal with young people.
Are social networks bad for people?
Facebook’s research indicated that 40 young women who had self esteem / mental health issues were negatively impacted by use of Instagram. There is a good deal of evidence within the Facebook document trove and elsewhere that social media can have a negative impact on mental health.
There is also research that establishes a link between social media and both conspiracy theories and political polarisation in Frances Haugen’s horde of Facebook’s internal documents. None of this is surprising and has been confirmed by third party sources over the years. So yes social networks can be bad for people.
This also isn’t the first time that social networks like Facebook have been linked to political polarisation.
But so have other mass media. For instance:
The early years of state television in Italy, which began transmission in 1954, have usually been viewed as crucial to the spread of mass culture through Italian society. In addition, these developments have essentially been seen in negative terms by historians and sociologists.Television and the City: the Impact of Television in Milan, 1954–1960
Back in 1997, research had looked at the negative effects of fashion magazines on female self image in college age students. Fashion magazines were seen to have a negative effect.
Back in 1990, there was already academic coverage of how talk radio was driving political polarisation with a genre of service called confrontalk. Factors driving this included satellite networks driving national syndication in the US and free phone numbers that the audience could dial into. By the mid-1990s nationally syndicated US talk show host Rush Limbaugh was named as a driver of political polarisation.
Political polarisation in the US has been discussed since at least the 1950s. By comparison bipartisanship is actually the odd event spanning from the 1950s through to the early 1990s; so polarisation is more likely to be closer to the norm in US politics.
While Facebook was used in Myanmar to organise and galvanise action against the Rohinga minority. It was hasn’t been the only media used this way. The Indonesian mass killings of 1965 – 1966 were galvanised with the use of propaganda pamphlets as well as organising and training local militias.
In a similar way to how Ugandan dictator Idi Amin used broadcast media, support amongst Hutu people for the Rwandan genocide was galvanised by two national radio stations. The state owned Radio Rwanda and commercial station Radio Télévision des Milles Collines (RTLM).
I think there is a bigger question to be asked about is Facebook and other social media platforms somehow worse than other media? And if so, why is that? What can be done to resolve it?
Has Facebook misled shareholders with regards the social network’s appeal with young people as Frances Haugen alleged?
I don’t know if Facebook had explicitly made misleading statements, but the media has certainly covered Facebook’s declining appeal to young people. By 2018, there was third party research to indicate that teens were abandoning Facebook for other platforms like Instagram (owned by Facebook) and Snapchat.
I would be surprised if investors hadn’t discovered it in their due diligence. The negative network effects for young people were entire predictable in terms of their nature, if not their timing. There are bigger questions to be asked about the business model of digital advertising, Scott Galloway put together some of the salient points in terms of its relative inefficiency.
I had a de ja vu moment when I heard about Facebook’s rebuttal of Frances Haugen. It reminded me of Microsoft’s responses during the buffeting it received in the late 1990s and early 2000s. If you want a definition of awkward watch Bill Gates video testimony for the antitrust hearings. This is just a small bit of the footage.
Yes before Bill Gates was a cross between Mr Rogers and the Oprah book club; he ran a company that dominated media and technology. Microsoft shut down innovation. If you were in an area that Microsoft might have an interest, you couldn’t get VC funding. Yahoo! always called themselves in a media company to try and stay out of Microsoft’s hit list.
It was a habit that was hard to shake. I flew over to San Francisco on the eve of a Martin Luther King bank holiday for a pitch (i think it was for BusinessObjects, but can’t be certain) at the agency I worked for. By the time that I landed and got in the office b AT&T Park, the pitch was off. The reason was the Microsoft was our client. Every pitch we did was run past them. I was told that we couldn’t do the pitch as it was an area that Microsoft might want to be in, in the future.
The weak sniping responses of Facebook reminded me so much of Microsoft’s responses to the antitrust issues and open source software. The bigger issue for Facebook is it that it can’t easily debunk its own research that Frances Haugen leaked outside the organisation as part of her work with the Wall Street Journal, report to the SEC and in front of the senate committee.
What does this all mean for Facebook?
There is a sense in the media that this scandal is different for Facebook and we are likely to see some sort of change. It is highly unlikely that the business will be broken up a la Standard Oil or the Bell Telephone Company. I don’t think that we’ll see Facebook having to do the kind of video that Microsoft did over its antitrust settlement in 2001.
America’s regulators have a history of being very light touch in nature, especially around issues that are tangental to free speech. Secondly, while there is a bipartisan agreement to take action against Facebook; there is a US partisan split on what to take action over and how that action should take place.
Broadly speaking the Democrats believe that Facebook is an engine of hate and harm. The Republicans feel that Facebook unfairly censors their opinions in favour of the Democrats.
Facebook may see regulation instead in markets like the European Union, Japan and Korea.
How will Facebook change?
It is hard to say how Facebook itself will change as an organisation. Early indications are that ‘move fast and break things’ might be moving out of the company lexicon as it looks to review the reputational risks of new products.
What’s less clear is whether this is a temporary or permanent behaviour change.
Facebook will also find it harder to recruit western employees in technical and product roles. But that was to be expected anyway as the company matured; there have been red flags about Facebook’s culture for over a decade and there is diminishing opportunities for riches joining a mature media technology company. Alphabet is in a similar position.
Like trendy bars or night clubs, with online properties the heat eventually moves on, it is a miracle that the likes of Alibaba, Baidu, Google and Yahoo! have lasted for so long.
Online services have their time and then lose their heat.
 Glazer, E., Hagey, K., Horwitz, J., Purnell, N., Schechner, S., Scheck, J., Seetharaman, D., J. Stamm, J.S., Wells, G. and West, J. (September 13, 2021 – October 3, 2021) The Facebook Files. United States: The Wall Street Journal
 Zubrow, K., Gavrilovic, M. and Ortiz, A.(October 3, 2021) Whistleblower’s SEC complaint: Facebook knew platform was used to “promote human trafficking and domestic servitude”. United States: CBS News (60 Minutes Overtime)
 Haugen, F. (October 4, 2021) Written statement of Frances Haugen. United States Senate Committee on Commerce, Science and Transportation Sub-Committee on Consumer Protection, Product Safety, and Data Security
 Zubrow, K. (October 4, 2021) Facebook whistleblower says company incentivizes “angry, polarizing, divisive content”. United States: CBS News (60 Minutes Overtime)
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 Rwanda radio transcripts. Canada: Montreal Institute for Genocide and Human Rights Studies at Concordia University
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 Glazer, E. and Seetharaman, D. (October 6, 2021) Facebook Slows New Products for ‘Reputational Reviews’. United States: Wall Street Journal