Isa de Michelis | CEO and founder Ernieapp [10.21.2018] Global footprint companies have a tendency to hire big names to head their public policy and governments affairs in crisis times, notably to give a strong sign of “change” in public space. Facebook seems not to be different as they onboarded former deputy-UK prime minister Nicholas Clegg to head global government affairs and communication function. The question however arises if this is really useful at the time the company is facing its biggest identity crisis.
Facebook is facing scrutiny by European regulators, FTC and US Congress, among others, but moreover they are facing their biggest challenges with their users and clients.
Privacy in a connected economy is lot more a business and economics affairs than a policy one. Users data drive business profitability for Facebook. But privacy negatively impacts their business model as user consent becomes a “check point” difficult to win through without user cooperation. In parallel to loosing users (deleting their Facebook accounts) Facebook is also loosing advertisers budgets as big brands see the sequential data breaches scandals continuing.
So to reverse the “crisis” pattern (rebuild trust across users, win back trust of advertisers and by doing so soften the policy and regulatory scrutiny) Facebook need to strike a new balance to match profit driven business goals and privacy requirements which are becoming dominant around the world and put at serious risk the destiny of the company.
The company has no choice other than going back to basic, renew a pact with his users, a pact of trust. Based on transparency and accountability on how user data are used. Even if that shift entails a significant cost that may erode margins. Users are too fundamental to Facebook business to exclude them from being a substantial part of the solution to the problem. If the company succeeds this step it will translate in positive feedbacks into the marketplace and would convince big advertising spenders to trust back Facebook platforms and government and regulators to acknowledge the company strategic change.
So a major sign of “change” from Facebook we are asking is a further update of its privacy policies and most notably the addition of a data deletion interface on Facebook and the opening of a privacy dashboard in WhatsApp. We see, if the company moves into that direction, that the effects could be extremely more powerful than announcing that Mr Clegg has taken on the role of global lead for communication and government relations at the company. That said, we wish to Mr Clegg all the best for his new appointment.
Read full article on BBC and available here.