In a blog post this morning, Facebook officially announced the news of its settlement with the Federal Trade Commission, which includes a record-setting $5 billion fine along with strict new rules regarding how the company must treat user data and privacy going forward. But there’s something funny about the post: It’s an upbeat, jaunty piece that makes online data privacy sound like a new bonus feature the company has happily rolled out, instead of the equivalent of a federally mandated ankle monitor. Well done, copywriters!
The post, titled “FTC Agreement Brings Rigorous New Standards for Protecting Your Privacy,” lays out a road map of sorts for improved data privacy, with Facebook writing that “this agreement is not only about regulators, it’s about rebuilding trust with people.”
The fine was levied against the company for violating a 2011 privacy settlement, in which it promised to protect user data from broad sharing with third-party apps. Facebook’s settlement with the FTC also requires the social network to create an independently appointed privacy committee on its board, designate compliance officers to oversee a privacy program, and undergo regular privacy audits. Meanwhile, CEO Mark Zuckerberg will be held personally liable for future privacy violations.
Of course, maybe it is a win for Facebook, since the $5 billion fine is just a fraction of its $56 billion valuation. Moreover, the deal with the FTC didn’t restrict the social network’s ability to gather personal information on their 2.4 billion users and sell it to the highest bidder, so there’s good reason for the company to be upbeat.
Not that investors are seeing the silver lining just yet. In the wake of the FTC fine and the separate announcement by the Securities and Exchange Commission that Facebook will pay another $100 million to settle a case for making misleading disclosures about the risk of data misuse, Facebook’s stock was down about 1% in early-morning trading. The company is due to release its second-quarter earnings report later this afternoon.
While Facebook may sound upbeat, as Fast Company contributor Nick Kolakowski noted, the company did time its announcement to drop during Robert Mueller’s Congressional testimony.
Hats off to Facebook for waiting until the Mueller testimony to drop the news of their FTC agreement! It's even better than doing it Friday at 5:30PM! https://t.co/I8KIUSTIfL
— Nick Kolakowski (@nkolakowski) July 24, 2019