According to statements by CEO Mark Zuckerberg, his company's services are and will be free for everyone. The largest social network Facebook, however, continues to make profits in many different ways. Overt or underground, very well hidden.
According to euronews, the performance of Facebook's stock is impressive. In the first quarter of 2014, net profits amounted to 642 million dollars, 25 cents per share, compared to 219 million dollars in the previous quarter, 9 cents per share. Total revenues amounted to 2.5 billion dollars, while analysts' estimates spoke of net profits of 24 cents per share and revenues of 2.36 billion dollars.
According to the above data, the "free" service will probably continue to be "free". Moreover, the company's FAQ states this categorically.
But how true is Facebook's statement? With over a billion users, the company has the convenience of not charging the end user a fee for using the service. However, after the latest revelations, we should probably rethink whether this is actually the ideal. The indications that come to us in the form of company announcements, or as leaks from the Media, confirm that everything has a cost.
But let's see in detail what the cost is.
With the launch of the new Promoted Post, many claimed that Facebook was preparing to put an end to the absolute free. We wouldn't exactly call it that. It was an indication that confirmed the company's logic of existence. A feature that brings additional profits by giving each user of the service the opportunity to advertise what they share, collecting additional clicks.
Let's not forget, of course, that Facebook earns millions of dollars from advertising by recording the likes and habits of users. How does it make money? It's very simple. Let's assume that you post a message to a friend saying that you just returned from a trip to Pelion and had a wonderful time. Perhaps you also visited pages about Pelion on Facebook and clicked "Like". With all this, without even knowing it, you gave the system personal information about yourself. It is very likely that at some point in the near future you will see an advertisement about Pelion.
The above paragraph describes how the company can make a profit by managing the data you expose about yourself. And we mention this because databases with such important personal information are treasures for third-party advertising companies.
Although Facebook has stated that it does not share its users' data with third parties, who can trust a company that was recently "caught" conducting psychological experiments on its members, without their knowledge?
Facebook was giving data to advertisers
For the record, the US Federal Communications Commission, after an investigation published in 2011 , concluded that the largest social networking service, deceives its users. Facebook then admitted that it repeatedly misled its members from December 2009 to July 2010. According to in.gr, it agreed to be placed under surveillance for 20 years, with the threat of a fine of $16,500 per day for any future violation of the agreement.
From September 2008 to May 26, 2010, Facebook gave advertisers the User IDs of members who clicked on their ads.
With this code, advertisers could collect more information about users who clicked on their ads, such as linking the product being advertised to the real name of the user who saw the post, how much time they spent on the advertiser's website. This way, advertising companies could in the future reach the user in new ways of advertising, combining the information they collected from the User ID. The same was true with applications that run on the Facebook platform.
According to the above revelations, we could hope that the company should have complied with the regulations by now.
Wrong. In our previous post, we reported that Facebook's exploitative practices were exposed once again.
EPIC, a non-profit American organization for the protection of online privacy, has filed a complaint with the Federal Trade Commission of the United States, denouncing as “unethical” the experiment that Facebook Inc. conducted “with people’s minds.” As EPIC claims, the company did not have the explicit consent of the users who carried out the experiment. The American organization is asking not only for the company to be punished but also for the algorithm that creates the Updates, which interfere with the emotions of the end user, to be made public.
The scientists, of course, argued that the experiment was conducted in accordance with Facebook's privacy terms. EPIC insists that the terms, at the time of the study, did not allow the use of members' data for research purposes. The experiment took place during the week of January 11-18, 2012, and as EPIC documents, the change in the relevant terms, which included the use of personal data for research purposes, was made four months after the experiment was conducted. The organization also recalls that the company is under supervision based on a previous relevant decision by the FTC, according to which it is required to have the explicit consent of its members before sharing their data with third parties.
EPIC is also asking for the publication of the operating mode that allowed the company's scientists and collaborating third parties from the universities of Cornell and California. This is because the company states in the FAQ that the end user can adjust what they see.
After all this, how much do you value your emotional state? Is Facebook a free service? We should probably accept that Mark Zuckerberg's "free" means accepting all of the above. In fact, according to the good manners we were taught as children, we should also say thank you.
