In a move that critics of Facebook are characterizing as a slap on the wrist, the social media giant was hit with a record $5 billion fine from the Federal Trade Commission over privacy violations, the AP reports.
“The fine is by far the biggest the FTC has levied on a tech company, though it won’t make much of a dent for a company that had nearly $56 billion in revenue last year,” Barbara Ortutay writes in the AP piece. “And despite efforts by the FTC’s majority to get a unanimous vote, two of the five commissioners opposed the settlement and said they would have preferred litigation to seek tougher penalties.”
The report adds that the fine “doesn’t go as far as the company’s biggest critics would have liked and it may do little to impede Facebook’s massive advertising business or its ability to collect people’s data. It also raises a bigger question: Can the world’s governments actually rein in a transnational corporation that directly touches almost a third of the world’s population?”
Siva Vaidhyanathan, the author of “Antisocial Media: How Facebook Disconnects Us and Undermines Democracy,” is quoted in the report saying: “While the $5 billion fine is a record for the FTC, that speaks more to the lightness of the FTC’s traditional penalties than it does to the effect on Facebook. Facebook makes that much money in a couple of weeks.”
Vaidhyanathan added that the other terms of the settlement fail “to crack down on the core misbehavior of Facebook.”
The AP report adds: “Wall Street seems to agree. Facebook’s stock price climbed higher Wednesday after the deal was announced and the company is worth much more than it was when the Cambridge Analytica scandal erupted back in March 2018. The company’s market value on Wednesday was hovering around $575 billion — roughly $40 billion above where it stood before the news of the Cambridge abuses broke.”
Facebook, however, “still faces probes around the world over privacy, security and other possible violations,” the AP notes. “Then there’s the broader antitrust probe by the U.S. Department of Justice, which the agency announced this week.”