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Internet Marketing Matters
Thoughts on website design and Internet marketing for Milwaukee, Waukesha and southeastern Wisconsin.
What Meta's Cambridge Analytica Settlement Means For Facebook Users
Meta, the parent company of FacebookFacebook parent Meta will pay $725 million to settle a class action lawsuit alleging that the social media giant shared the personal data of 87 million users with a shadowy British political consulting firm working for Donald Trump in 2016. That company, Cambridge Analytica, shut down two years later amid the resulting scandal. The settlement still needs approval of a federal judge in California as of this writing.

The lawsuit focused initially on Facebook's alleged complicity in political skullduggery, then expanded into a wider probe of how Facebook monetizes its operations by selling the personal data of unwitting users. Facebook denied culpability then and now, even while agreeing to pay what amounts to the biggest breach-of-privacy fine in the history of Big Tech.

“We pursued a settlement as it’s in the best interest of our community and shareholders. Over the last three years we revamped our approach to privacy and implemented a comprehensive privacy program,” a Meta spokesperson told CNBC.

Having watched this case and written about it for years, I remain skeptical that major changes have indeed occurred. I'm likewise dubious about the broader impact of the case on the social media industry. Will it have a salutory effect? Probably not. The racket is so lucrative, something like this will feel like just a speed bump. Consider that Facebook currently is valued at about $245 billion. It can pay the occasional speeding ticket.

The greater threat which this affair poses for the company is a potential loss of user trust. Will Facebook users begin to wonder what it really costs for them to use this "free" service?

When "Free" Isn't Free

In using Facebook and other social media sites, you should know that you are taking on risk. I do know it, which is why I use social media sparingly and selectively, with my eyes wide open.

Nothing that you do or say there is private. Everything is catalogued by the site owners for the purpose of creating a consumer profile. Having millions of consumer profiles on inventory gives Facebook the ability to narrowcast ads based on user affinity. It's all about precision delivery. That's what Mark Zuckerberg is referencing when he uses this vague term "your data."

You pay for the use of Facebook with what I'll call your retail identity. It's an in-kind transaction in which you participate in the creation of your individual consumer profile. The profile is based on your posts and your clicks, plus any personal details you may choose to reveal in your account settings. And now it's also going to include dating profile information volunteered by millions of users participating in the company's new hookup service, Facebook Dating.

So in this sense Facebook is the most sophisticated surveillance system ever built. But no you musn't compare it with Big Brother, because you are surveilled only if you opt in. You have to open the door and invite Big Brother into your house. Facebook is actually fairly transparent about all of this. The Terms of Service which you didn't read tells all about it.

This system allows Facebook to serve you ads based on your logarathmically modeled profile affinities - including your political leanings and hot-button passions. Hence Facebook can efficiently target you for political ads which challenge your views or reinforce them, depending on the needs of the advertiser.

The exact makeup of your consumer profile remains a closely guarded secret. But here's a highly educated guess. It predicts what you're in the market to buy and what you're primed to believe. It inventories your professional emphasis, leisure pursuits and political convictions. And of course it knows everybody you know within the network. Facebook defines "privacy" as not selling your profile to third parties. But you have no privacy whatsoever relative to how Facebook uses your profile within it's own sophisticated advertising system.

That system makes traditional media tracking look stoned-aged. Imagine your TV had a built-in transponder which reported on your viewing habits to central marketing command in real time. Now imagine that every TV everywhere had this device. And it was further capable of serving personalized advertising regimens to individual viewers. Nielsen Media Research can only dream of such power.

Simply put, Facebook manufactures a product called attention. That's what they sell. Raw material for the product is harvested from users. Their free contribution powers the entire system. If anybody is owed something, it's you.

I have never been a big Booker and in the last couple years cut back my activities significantly. The reason was, I got creeped out that this website may know more about me than I do. Call me old fashioned that it bothers me. Most people look at Facebook as kind of a free amusement park. I see it more as a place to have your brain washed - an epic behavioral modification experiment. And I understand that it's anything but free. The exchange of value simply takes a form other than U.S. currency..

There is no doubt that plenty of users know the deal and are fine with it. It allows them to have a Facebook account without paying a subscription fee. This business model is far from unique to Facebook. Google and many others gather user data to build their own retail identity profiles for each of us. An algorithm then calculates what kind of stuff we are primed to buy; and the system serves us up enticing ads.

Diabolical? Many people would say so. But, again, there's no doubt that other people know the deal and accept it, as long as they understand it. Some may even feel appreciative of an algorithm doing their shopping - and their thinking - for them.

The problem Facebook ran into was that it apparently didn't honor the deal in its dealings with the Trump Campaign and Cambridge Analytica. It allegedly sold our retail identity profiles to a third party outside its own network, in violation of its own stated policy. That is akin to identity theft on an industrial scale. Facebook to this day denies wrongdoing, yet was prepared to pay $725 million to prevent the full facts from being aired in a court of law before a jury.

Does the outcome of the Cambridge Analytica lawsuit portend an industry-wide embargo of the practice? I'm not betting on it; nor should you. Think about that every time you log into a social media account which you consider to be your own property.

It's not.

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