Business|The Week in Business: From Facebook to Meta
What’s Up? (Oct. 24-30)
The Facebook Papers
Last week, more than a dozen news organizations published reports based on a trove of Facebook’s internal documents leaked by a former product manager. The documents detail what Facebook knew about its role in radicalizing users, employees’ questions about the impact of its core features, and its struggles to curb dangerous content internationally. The former Facebook employee-turned-whistle-blower, Frances Haugen, has appeared on “60 Minutes,” in front of Congress, and — this past week — in Britain’s Parliament to argue that the company puts profits before people. (Facebook has said that it has millions of documents that counter those shared by Ms. Haugen). Whistle-blowers have filed at least nine complaints against Facebook with the Securities and Exchange Commission based on internal documents. On Thursday, Facebook changed its name to Meta.
Tesla Joins the Trillion-Dollar Club
Tesla reached a $1 trillion market valuation last week, a milestone that has only been passed by five other companies: Apple, Microsoft, Amazon, Facebook and Alphabet. The spike in Tesla’s share price was propelled by an announcement from Hertz that it would convert more than 20 percent of its rental fleet to Tesla’s electric cars by the end of next year. The car-rental company said it would buy 100,000 Teslas, a purchase that Bloomberg reported would generate about $4.2 billion of revenue. Tesla’s market capitalization is greater than those of General Motors, Toyota, Ford, Volkswagen, BMW, Honda and several other automakers combined.
Inflation Is Still Going Up
Both companies and shoppers are noticing the impact of high inflation, driven in part by supply chain shortages. Prices of meat, poultry, fish and eggs in U.S. cities are up 15 percent since the start of 2020. And General Electric, Sherwin-Williams and Hasbro all noted that rising prices were affecting their businesses on calls with investors last week. One measure of inflation released on Friday, the Personal Consumption Expenditures price index, showed prices in the United States were rising at the fastest rate in three decades in September, while another measure showed the highest ever rate of inflation in the eurozone in October. Signals from the bond market suggest that rising inflation could last longer than the temporary bump in prices that many policymakers had expected because of the pandemic.
What’s Next? (Oct. 31-Nov. 6)
It May Be Time to Taper
Federal Reserve officials will gather this week, and the two-day meeting is a big one. The central bank is expected to announce that it will begin winding down the bond-buying efforts it put in place to support the economy during the pandemic. The Fed has been signaling for months that it planned to begin tapering its bond purchases in November. But it is not expected to raise interest rates until at least the middle of next year.
The Pace of Job Growth
On Friday, the Labor Department will report how many jobs were filled in October. Job growth slowed to the weakest pace of the year in September as consumers and businesses reacted to a spike in coronavirus cases. But hospitalizations and deaths linked to the coronavirus fell in October, so economists expect job growth to have accelerated. Still, labor shortages and low labor force participation may have continued to hamper the recovery. In September, fewer Americans were seeking work than before the pandemic, even as expanded unemployment insurance benefits expired early in the month. At the same time, with so many jobs unfilled, a record number of workers quit their jobs in August, data released earlier this month showed.
On the Supreme Court Agenda
The Supreme Court has two highly anticipated cases on its schedule this week. On Monday, the Supreme Court will hear arguments in two separate challenges to the Texas law that bans most abortions after six weeks of pregnancy. Both challengers said the law is at odds with Roe v. Wade, which prohibits states from banning abortions before fetal viability, or around 23 weeks. Dozens of companies, including the ride-hailing company Lyft and the cloud-storage company Box, publicly opposed the law in September, when it went into effect. On Wednesday, the court will hear its first major Second Amendment gun case in more than a decade. The case involves a longstanding New York law that imposes strict limits on carrying guns outside the home.
PayPal killed its Pinterest deal. Democrats are struggling to reach an agreement on their spending deal. Millennials are struggling to manage their Gen Z workers. And if the Centers for Disease Control and Prevention signs off on giving Pfizer-BioNTech’s coronavirus vaccine to children 5 to 11, as expected, children could start getting shots as early as Wednesday.
Facebook Adds New Trend Insights in Creator Studio, Which Could Help Shape Your Posting Strategy
Facebook’s looking to provide more content insight within Creator Studio with the rollout of a new ‘Inspiration Hub’ element, which highlights trending content and hashtags within categories related to your business Page.
As you can see in these screenshots, posted by social media expert Matt Navarra, when it becomes available to you, you’ll be able to access the new Inspiration Hub from the Home tab in Creator Studio.
At the right side of the screen, you can see the first of the new insights, with trending hashtags and videos from the last 24 hours, posted by Pages similar to yours, displayed above a ‘See more’ prompt.
When you tap through to the new hub, you’ll have a range of additional filters to check out trending content from across Facebook, including Page category, content type, region, and more.
That could be hugely valuable in learning what Facebook users are responding to, and what people within your target market are engaging with in the app.
The Hub also includes insights into trending hashtags, within your chosen timeframe, which may further assist in tapping into trending discussions.
How valuable hashtags are on Facebook is still up for debate, but you’ll also note that you can filter the displayed results by platform, so you can additionally display Instagram hashtag trends as well, which could be very valuable in maximizing your reach.
Much of this type of info has been available within CrowdTangle, Facebook’s analytics platform for journalists, for some time, but not everyone can access CrowdTangle data, which could make this an even more valuable proposition for many marketers.
Of course, overall performance really relates to your own creative, and thinking through the action that you want your audience to take when reading your posts. But in terms of detecting new content trends, including hashtag usage, caption length, videos versus image posts, and more, there’s a lot that could be gleaned from these tools and filters.
It’s a significant analytics addition – we’ve asked Facebook for more info on the rollout of the new option, and whether it’s already beyond test mode, etc. We’ll update this post if/when we hear back.
Meta Updates Policy on Cryptocurrency Ads, Opening the Door to More Crypto Promotions in its Apps
With cryptocurrencies gaining momentum, in line with the broader Web 3.0 push, Meta has today announced an update to its ad policies around cryptocurrencies, which will open the door to more crypto advertisers on its platforms.
As per Meta:
“Starting today, we’re updating our eligibility criteria for running ads about cryptocurrency on our platform by expanding the number of regulatory licenses we accept from three to 27. We are also making the list of eligible licenses publicly available on our policy page.”
Essentially, in order to run any crypto ads in Meta’s apps, that currency needs to adhere to regional licensing provisions, which vary by nation. With crypto becoming more accepted, Meta’s now looking to enable more crypto companies to publish ads on its platform, which will provide expanded opportunity for recognized crypto providers to promote their products, while also enabling Meta to make more money from crypto ads.
“Previously, advertisers could submit an application and include information such as any licenses they obtained, whether they are traded on a public stock exchange, and other relevant public background on their business. However, over the years the cryptocurrency landscape has matured and stabilized and experienced an increase in government regulation, which has helped to set clearer responsibilities and expectations for the industry. Going forward, we will be moving away from using a variety of signals to confirm eligibility and instead requiring one of these 27 licenses.”
Is that a good move? Well, as Meta notes, the crypto marketplace is maturing, and there’s now much wider recognition of cryptocurrencies as a legitimate form of payment. But they’re also not supported by most local financial regulators, which reduced transaction protection and oversight, which also brings a level of risk in such process.
But then again, all crypto providers are required to clearly outline any such risks, and most also highlight the ongoing market volatility in the space. This expanded level of overall transparency means that most people who are investing in crypto have at least some awareness of these elements, which likely does diminish the risk factor in such promotions within Meta’s apps.
But as crypto adoption continues to expand, more of these risks will become apparent, and while much of the crypto community is built on good faith, and a sense of community around building something new, there are questions as to how much that can hold at scale, and what that will then mean for evolving scams and criminal activity, especially as more vulnerable investors are brought into the mix.
Broader promotional capacity through Meta’s apps will certainly help to boost exposure in this respect – though again, the relative risk factors are lessened by expanded regulatory oversight outside of the company.
You can read more about Meta’s expanded crypto ad regulations here.
Meta Outlines Evolving Safety Measures in Messaging as it Seeks to Allay Fears Around the Expansion of E2E Encryption
Amid rising concern about Meta’s move to roll out end-to-end encryption by default to all of its messaging apps, Meta’s Global Head of Safety Antigone Davis has today sought to provide a level of reassurance that Meta is indeed aware of the risks and dangers that such protection can pose, and that it is building safeguards into its processes to protect against potential misuse.
Though the measures outlined don’t exactly address all the issues raised by analysts and safety groups around the world.
As a quick recap, back in 2019, Facebook announced its plan to merge the messaging functionalities of Messenger, Instagram and WhatsApp, which would then provide users with a universal inbox, with all of your message threads from each app accessible on either platform.
The idea is that this will simplify cross-connection, while also opening the door to more opportunities for brands to connect with users in the messaging tool of their choice – but it also, inherently, means that the data protection method for its messaging tools must rise to the level of WhatsApp, its most secure messaging platform, which already includes E2E encryption as the default.
Various child safety experts raised the alarm, and several months after Facebook’s initial announcement, representatives from the UK, US and Australian Governments sent an open letter to Facebook CEO Mark Zuckerberg requesting that the company abandon its integration plan.
Meta has pushed ahead, despite specific concerns that the expansion of encryption will see its messaging tools used by child trafficking and exploitation groups, and now, as it closes in on the next stage, Meta’s working to counter such claims, with Davis outlining six key elements which she believes will ensure safety within this push.
Davis has explained the various measures that Meta has added on this front, including:
- Detection tools to stop adults from repeatedly setting up new profiles in an attempt to connect minors that they don’t know
- Safety notices in Messenger, which provide tips on spotting suspicious behavior
- The capacity to filter messages with selected keywords on Instagram
- More filtering options in chat requests to help avoid unwanted contact
- Improved education prompts to help detect spammers and scammers in messages
- New processes to make it easier to report potential harm, including an option to select “involves a child”, which will then prioritize the report for review and action
Which are all good, all important steps in detection, while Davis also notes that its reporting process “decrypts portions of the conversation that were previously encrypted and unavailable to us so that we can take immediate action if violations are detected”.
That’ll no doubt raise an eyebrow or two among WhatsApp users – but the problem here is that, overall, the broader concern is that such protections will facilitate usage by criminal groups, and the reliance on self-reporting in this respect is not going to have any impact on these networks operating, at scale, under a more protected messaging framework within Meta’s app eco-system.
Governments have called for ‘backdoor access’ to break Meta’s encryption for investigations into such activity, which Meta says is both not possible and will not be built into its future framework. The elements outlined by Davis do little to address this specific need, and without the capacity to better detect such, it’s hard to see any of the groups opposed to Meta’s expanded encryption changing their stance, and accepting that the merging of all of the platform’s DM options will not also see a rise in criminal activity organized via the same apps.
Of course, the counterargument could be that encryption is already available on WhatsApp, and that criminal activity of this type can already be undertaken within WhatsApp alone. But with a combined user count of 3.58 billion people per month across its family of apps, that’s a significantly broader interconnection of people than WhatsApp’s 2 billion active users, which, arguably, could open the door to far more potential harm and danger in this respect.
Really, there’s no right answer here. Privacy advocates will argue that encryption should be the standard, and that more people are actually more protected, on balance, by enhanced security measures. But there is also an undeniable risk in shielding even more criminal groups from detection.
Either way, right now, Meta seems determined to push ahead with the plan, which will weld all of its messaging tools together, and also make it more difficult to break-up its network, if any antitrust decisions don’t go Meta’s way, and it’s potentially pressed to sell-off Instagram or WhatsApp as a result.
But expect more debate to be had, in more countries, as Meta continues to justify its decision, and regulatory and law enforcement groups seek more options to help maintain a level of accessibility for criminal investigations and detection.
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