Today, Explained - Is it time to delete Facebook?

Episode Date: December 4, 2018

The Verge’s Casey Newton explains the pros and cons of staying on Facebook after the latest scandal. Learn more about your ad choices. Visit podcastchoices.com/adchoices

Casey Newton, you cover social networks and how they're futzing about with our democracy for the verge. Is Facebook okay? Facebook has been in two years of what I like to call perma crisis. It's kind of been lurching from one major problem to the next. Russia. Cambridge Analytica. Hate speech. 2016 election. And it seems to have stepped in it yet again. And so can you help us sort of unwrap this giant knot the company seems to be in right now? This is like the post-Cambridge Analytica scandal.

So it all starts in January 2018. Good evening. So it all starts in January 2018. That's during the World Economic Forum in Davos when all of the fancy people go to talk about the future of the world. And at Davos this year, George Soros, the wealthy financier, philanthropist, stands up on a stage and he says, The internet monopolies have neither the will nor the inclination to protect society against the consequences of their actions. That turns them into a menace. Facebook and Google are a menace to society. This lands like a bombshell inside of Facebook.

They had not previously known that George Soros thought they were a menace. A few days after the conference, Sheryl Sandberg, who's the chief operating officer of Facebook, sends an email to her team. And she says, we need to look into this and we need to see what's going on. And we know that because the New York Times reported it just a few days ago. It's more fallout from what I've been calling the definer scandal. So in the wake of this Soros menace to society speech, Facebook decides it needs to start paying much closer attention to Soros.

And in fact, Soros did provide funding for a couple of non-profit organizations that were challenging Facebook to do better across a variety of civic issues. Soros has a history of being an activist investor. He has shorted company stocks before and made a lot of money doing so. He's known for being quite good at it. So the immediate concern inside of Facebook was that Soros might be becoming an activist investor in Facebook, and they wanted to look into whether he had taken a position in the company, and if so, what that might be. And so Facebook hired a PR agency called Definers. It's a Republican PR agency

operating out of Washington, and one of its specialties is what's often called opposition research. normal PR stuff. They pulled clips of what people like me were writing about Facebook, or they would email me when Facebook was launching some new feature. But they were also going out to reporters and pitching stories that not just made Facebook look good, but that might have made its enemies look bad. And one of the things that they did was to encourage people to look into George Soros' financial backing of some of Facebook's critics. Now, from Facebook's perspective, there's nothing scandalous about this. Companies all the time will ask you to consider the financial interests of their critics. But with George Soros, it was a much more sensitive subject. And the reason is because George Soros is the subject of absolutely crazy anti-Semitic conspiracy theories. He's Jewish, he's a Holocaust

survivor, and you don't have to stumble far into a dark corner of the internet to find people saying absolutely crazy things about George Soros ruling the world. And so the reason that the Definer scandal became a scandal was because people accused Facebook of trying to use anti-Semitism to take down one of their biggest critics. Okay, where does this Definer scandal go from there? So there was another aspect of this scandal that did and didn't involve Soros. And that was something called NTK. NTK is a website that writes stories, kind of conservative-leaning, partisan clickbait. It was housed in the same office as definers and nbc news talked to a former employee who said that

definers viewed ntk as quote their in-house fake news agency ntk would go out would write really scurrilous stuff it would get picked up by breitbart and then from there it was all the way into the conservative media ecosystem and so when definers had an angle it wanted to advance, it had this willing partner sitting literally in its office. So why is this ironic? Well, ever since the 2016 election, Facebook has been saying it's going to clean up misinformation on its platform, right? It's going to become a better home for accurate news. And what the Definer scandal suggested was that one of the PR agencies on its payroll was actually creating misinformation of its own. Is this like par for the course?

I mean, you don't just cover Facebook. You cover all sorts of Silicon Valley goings on. Is this kind of just how they do out there or is this especially ill-advised? Well, it's especially ill-advised because when people see you playing these kind of cynical, paranoid games with reporters companies are just honest with us and straightforward about what they're doing then they don't need to hire agencies to go flood Breitbart with stories flattering to them and critical of their enemies right now is this the way that things gets done in Washington DC absolutely but Silicon Valley is a happy optimistic sunshiny place uh it wants to believe that it's changing the world for the better and so these kinds of tactics just don't

look great right and they really kind of clash with facebook's um self-image as this you know happy place of positive connections yeah and in the meantime facebook's been running this like propaganda campaign about how they're getting back to the essence of Facebook. Friends, right? We came here for the friends. And we got to know the friends of our friends. Then our old friends from middle school, our mom.

Right. Yeah, Facebook is about your friends, and it's also about taking down your enemies. But, you know, for those of us who've been covering Facebook for a while, though, these kinds of tactics weren't totally unfamiliar. In 2011, Facebook hired another PR firm called Burson Marsteller to try to smear Google and to try to get USA Today and some other publications to write about Google's privacy policies. And that, of course, was coming at a time when Facebook's own privacy policies were getting a lot of attention. And this was a mini scandal at the time, although, of course, in 2011, Facebook was much smaller. I remember when the news came out,

though, and feeling really, really icky about it because Burson Marsteller was pitching me on a bunch of other things at the time, and I didn't realize that they did that kind of dark arts work. And because there was such blowback, I assumed that this would be the last time we would see Facebook do something like this. And in truth, it just took them seven years. The funny thing about all these Facebook scandals, Facebook's doing better than ever. So what do you do if you want to take a stand? And why doesn't anyone do it? Why you can't quit Facebook. That's next on Today Explained. explained. Remember that podcast Missing Richard Simmons? It was a big hit about, you know, Richard Simmons disappearing off the face of the planet. How about Y2K? Remember that? That whole Armageddon

that never happened? Well, the team behind Missing Richard Simmons now has a podcast about Y2K. It's called Headlong Surviving Y2K. It's all about the hysteria at the turn of the century when the world was bracing for disaster. But you know, of course, nothing really happened. From an evangelical family preparing for the apocalypse to the coders who fixed the Millennium Bug, surviving Y2K follows their stories through New Year's Eve 1999 and reveals what happened at midnight. I remember I was sitting at my neighbor's house playing Nintendo 64,

playing Mario Kart. I was Wario. I was in first, and I was really hoping I would win. But I was worried that at the stroke of midnight, the whole thing would just turn off, but I won. Anyway, you can binge the entire season of Headlong Surviving Y2K now. Find it wherever you find your podcasts. Casey, where does this Facebook scandal, hiring a PR firm with ties to a fake news agency to run a campaign against an already vilified Jewish person, where does that fit in with all of the

other recent Facebook scandals? I feel like people aren't even mad at Twitter and Uber anymore. It's all Facebook. Look, I think we are in the middle of a huge cultural reckoning over social media. I think it started right after the 2016 election. I think part of it was that Trump got elected, and there was a suggestion that people on Facebook were using it to manipulate our emotions. I think that made a lot of us really uncomfortable. But there are a lot of other things about Facebook that make people uncomfortable too. People are uncomfortable with how much time they're spending on the platform. People are reporting that the more they use it, the more lonely and depressed they feel. And so you have all of these strands kind

of converging together. You also have a company that has gotten absolutely enormous, has over 2.2 billion users. And in some of the countries where it's operated, it has been found to spread hate speech and incite violence and really destabilize democracies. Months after Mark Zuckerberg said he was working on the problem, Reuters today revealed it's found more than a thousand Burmese posts spreading hate. In the West, it's horrible. Over there, it can be fatal. Facebook has done its best to hire a bunch of janitors and go clean up the mess, but it's operating at a scale where the messes are breaking out faster than it can clean them up. So is it still an incredibly successful company? Yes, it's making more money than ever. And we shouldn't lose sight of that. It generated $13.7

billion in revenue during the last quarter compared to $10 billion during the same quarter a year ago. But at the same time, the company's reputation is in tatters. And when you think about the services on the internet that you lose, my guess is of the biggest ones, you would probably tell me that you would find Facebook the easiest to leave. You would give up Facebook before you would give up Google, before you would give up Apple, before you would give up Amazon. And so to me, that's the real danger for Facebook here. It's not, you know, that one scandal is the end of the company. It's that bit by bit, more and more people just have reasons to say, you know what, the hell with it. And the less time they spend on Facebook, the less valuable it is to all of their friends.

And you start to see this reverse network effect thing happen where people just start walking away from the platform and it just kind of ossifies. At Facebook size, that is a process that'll take years, if not more than a decade. But I do feel like you're starting to see some cracks in the surface there. A thing I hear over and over though, is that like, you know, I don't use Facebook anymore. I just like, I just hang out on Instagram, which I always just roll my eyes at like, bro, do you have any idea who owns Instagram? You know, we actually surveyed people on this and the answer is that mostly they don't. Because Facebook's smart. They've been very good at keeping their brand off of Instagram,

right? They don't want you to know. They have been. But let's remember something else that happened this year, which is that Instagram's co-founders, Kevin Systrom and Mikey Krieger quit. And so Facebook now views Instagram as basically just another team. I think it's actually impossible to overstate the degree to which Instagram is the future of Facebook. And I think that over time you will see Instagram transform into Facebook. Like look at the features they're adding. See if they remind you of things that you once saw on Facebook. So, I mean, to truly walk away from Facebook, do you have to walk away from Facebook and Instagram and WhatsApp? Yes. And also Oculus and Portal and maybe a couple of other things too. It's a big company. But, you know, Sean, if you want my hot take for what 2019 is all about, 2019 is going to

be the year of the group chat. Like, I just believe this in my heart. I think we're all going to come back to just texting like our five friends, our six friends. We're going to laugh. We're going to miss the drama of keeping up with the Joneses and trying to look good in our swimsuits. And we're just going to text. I've never looked good in my swimsuit. I don't need it. Same here, brother. Do you still have a Facebook account, Casey? I do. I do still have a Facebook account. And I think honestly, even if I didn't cover the company, I think I would. For me, Facebook is a phone book and an events manager, right? When I need to get in touch with somebody who I haven't talked to in a long time,

I know I can look up their name and I'll find them right away. If I want to invite folks to my improv show on Friday night, I'm going to go ahead and create a Facebook event. I think all of that's fine. Because Facebook is so vast, we have a hard time talking about it because there are just so many different layers to it, right? It's a place where many, many things are true at the same time. And honestly, I think that's one of Facebook's biggest challenges. But when we draw back and just use Facebook to get in touch with that one cousin in New Zealand, or for like to RSVP to a friend's event and nothing more, that still helps Facebook, right? They're still making some coin off of that. They're still tracking your movement,

tracking your gestures, and that's serving this big behemoth that keeps tripping on its shoelaces, right? So they make the vast majority of their money from the news feed on mobile devices. So if you open up Facebook on your phone, you start scrolling, you're starting to see ads right away. If you stop using the news feed, you will hurt Facebook's revenue, right? If you use Instagram and you don't scroll the newsfeed, you will hurt Facebook's revenue, right? If you use Instagram and you don't scroll through the feed, you will hurt Instagram's revenue. If you maybe post your own stories on Instagram, but never look at anyone else's, you will hurt Instagram and you'll hurt Facebook. So the way that this company makes money is by showing you ads in the

feed. I just wonder if Facebook's really accountable in all of this. Mark had to go before Congress. They released these apology ads, but they're still making so much money and they're growing. Is there anything to really make them want to do better? I think at the end of the day, we're talking about some really wealthy people, right? And so, you know, we should acknowledge that. At the same time, particularly for the top executives, this is their legacy now, right? They either fix this or they go down in history as goats. When you talk to people in Facebook, even at a much lower level, you get a sense of the worry and the fear there

that it's not going to come together. There is a sense that they have been in a bunker taking shelves for a long time. And by the way, many of them are quick to say, but you know what, we deserve some of it, or even we deserve a lot of it. There is an awareness inside the company that they have made a lot of mistakes. I've even talked to people who have joined the company like since shortly before or even during Cambridge Analytica. And part of their motivation was, we think we can fix this or we want to fix this. We want to be part of a solution here. There is still a lot of idealism inside that company. You know, have they paid for it? Like you said, they're still making phenomenal money.

But are people a little bit more reluctant to say where they work at a cocktail party now? I think you probably are starting to see some of that happen, honestly. So it's a very, very minor consequence in the grand scheme of things, but it hints at something larger. And if the past two years have been any indication, we have not seen the last Facebook scandal. Casey Newton reports on social media for The Verge. I'm Sean Ramos-Ferrum. This is Today Explained.

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