Tag Archives: Facebook
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The social networking giant said in a blog post on Thursday that it is removing 559 pages–the public profiles of firms and celebrities–and 251 accounts, claiming that they were intentionally misleading people, engaging in “inauthentic behavior,” and posting spam.
Although a lot of the accounts and pages that Facebook typically removes involve scams intended to sell “fake sunglasses or weight loss ‘remedies,’” Facebook said that shady actors are increasingly sharing “sensational political content.”
This questionable political content, which Facebook said covers the gamut of the political spectrum, helps these bad actors “build an audience and drive traffic to their websites, earning money for every visitor to the site,” the company said.
“And like the politically motivated activity we’ve seen, the ‘news’ stories or opinions these accounts and pages share are often indistinguishable from legitimate political debate,” Facebook executives said in the post. “This is why it’s so important we look at these actors’ behavior–such as whether they’re using fake accounts or repeatedly posting spam–rather than their content when deciding which of these accounts, Pages or Groups to remove.”
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Facebook did not name in its blog post any of the pages and accounts that it removed, but several media outlets reported that they included groups with names like “Reverb Press,” “Nation in Distress,” “Right Wing News.” and “Snowflakes.”
The progressive non-profit Media Matters cited over the summer that Nation of Distress was one of the biggest spreaders of conspiracy theories and propaganda on Facebook.
Nation In Distress is one of the most popular (and extreme: https://t.co/F5drgCUm5x) right-wing meme pages on Facebook. In the past 72 hours, they have:
– pushed a conspiracy from fake news sites
– resurfaced an old Clinton conspiracy
– re-posted Russian propaganda pic.twitter.com/t2t5KyZRuG
— Natalie Martinez (@natijomartinez) August 21, 2018
Some of the other misleading pages previously highlighted by Media Matters included “Dean James III%”, “USA in Distress,” and “The voice of the people.” These pages are currently inaccessible, suggesting that Facebook removed them as well.
Fortune contacted Facebook for more information and will update this post if it responds.
Are you on Facebook? If you are, you’ve most likely received a repetitive, canned note (or 100) from your friends/family that is driving you into a fit of rage. If you haven’t, consider yourself lucky. However, there’s indeed an irritating hoax going around that has grabbed some serious attention. Here’s what the message says:
Hi….I actually got another friend request from you yesterday…which I ignored so you may want to check your account. Hold your finger on the message until the forward button appears…then hit forward and all the people you want to forward too….I had to do the people individually. Good Luck!
Spoiler: there’s no ‘clone’ account. This is just a hoax, so delete the message and be worry-free that an account or second-degree account is compromised.
We’re all familiar with this level of chain-like-mail, but what makes this time so different? The obvious answer could be any of the following:
- It’s coming from friends & family — so you can trust it
- There’s clear instruction on what to do
- It doesn’t contain a link
- You’re doing it through Messenger (it’s more novel), vs. a status update
However, it goes deeper than that.
We need to remember that Facebook has its fair share of ‘bad press’ (yes, there is such a thing) the past couple years, stemming from the Cambridge Analytica scandal which affected 87 million accounts. Then, all 2.2 billion Facebook users received a notice in an effort to inform them on how to protect their information. Add to this that on September 28th, hackers exploited a flaw which resulted in compromised data for 50 million accounts. Yikes.
And what do you get when you mix that all together?
A user constantly on high-alert due to the endless loop of security & privacy concerns
The decision to forward is almost an irrational one–and an innate reaction to Facebook’s shaky history and hyper-recent exploitation. All of that creates an uncomfortable level of ‘unknown’ when it comes to privacy and, at the end of the day, your friends & family are really just trying to help inform of a potential concern.
So, the next time you receive one of these messages, maybe take a deep breath and if you feel like a good Samaritan, let them know that they don’t need to forward the message out to anyone else–the clones aren’t here (yet).
Published on: Oct 7, 2018
Over the past year, Facebook has faced a reckoning over the way its plan to connect the next billion users to the internet has sown division, including spreading hate speech that incited ethnic violence in Myanmar and disseminating propaganda for a violent dictator in the Philippines. But even as the company admits that it was “too slow to prevent misinformation and hate” in Myanmar and makes promises to be more proactive about policing content “where false news has had life or death consequences,” Facebook’s efforts in the developing world appear to be speeding up rather than pausing to ensure that history doesn’t repeat itself.
In mid-August, Facebook said it was making progress in Myanmar by adding more Burmese speakers and changing its content-moderation policies to make it easier to report bad conduct and root out hate speech. By the end of this year, Facebook says, it expects to hire 100 Burmese speakers to review content. The changes come more than two years after Facebook pushed into Myanmar. During that time civil-society groups have repeatedly asked the company to do a better job patrolling hate speech, and UN investigators said Facebook had played a “determining role” in the killing of Rohingya Muslims.
But Facebook’s lack of preparedness in Myanmar has not halted its efforts to expand access to the internet—and to Facebook—in the Global South. A couple of weeks after touting its progress in Myanmar, Facebook quietly celebrated plans to expand Wi-Fi access in India, Indonesia, Kenya, Nigeria, and Tanzania through partnerships with companies that sell Wi-Fi hardware. In Tanzania, for example, the World Bank estimates that only 13 percent of people use the internet, roughly the same internet penetration in Myanmar in November 2015.
From Free Basics to Express Wi-Fi
Facebook’s efforts to connect the next billion fall under internet.org, which the company describes as an effort to get 4.5 billion unconnected people on the internet. Initially, Facebook’s preferred vehicle to spread connectivity was Free Basics, an app that provided free access to a limited number of websites. Amid criticism of that approach in India and elsewhere, Facebook in the past year has instead promoted a program called Express Wi-Fi, where local merchants or business owners offer affordable access to Wi-Fi hot spots, using Facebook’s Express software as a platform for billing and managing accounts.
Express Wi-Fi has raised fewer red flags because, unlike Free Basics, users can access the full internet. Facebook provides financial support to set up the hot spots, but the company says Express Wi-Fi is not supposed to be a profit center. Rather, Facebook wants partners to get enough financial return to keep expanding connectivity efforts.
Facebook would not disclose how many Express Wi-Fi hot spots there are or how the program has grown, but it is clearly part of Facebook’s larger push into Africa. Three of the five countries where Express Wi-Fi has launched are in Africa. In March, Facebook launched an Express Wi-Fi app in the Google Play store in Kenya and Indonesia. Facebook’s ISP partner in Kenya, Surf, says it has 1,100 Express Wi-Fi hot spots in the country, up from 100 in February 2017. In September, Facebook announced a partnership with The Internet Society, an American nonprofit, to improve internet connections throughout Africa.
Digital rights advocates in Africa say Facebook has evolved its approach after the problems in Myanmar. Facebook is working more closely with civil society groups, sending more delegations, recruiting native language speakers, planning for contentious elections, and hosting digital literacy efforts.
Ephraim Percy Kenyanito, a digital program officer at the East Africa office for Article 19, a nonprofit that defends freedom of expression, says Facebook’s decision to hire more Africans, especially from civil society groups, has made it easier for concerns to be heard, if not always addressed. During the 2017 presidential election in Kenya, for example, Facebook responded when advocates reported hate speech or fake news, but the company did not always protect female journalists who became targets for harassment on the platform after writing critical stories about politicians. “They’re trying to get there, but they need to do better.”
Still, some of the civil society groups say Facebook’s efforts often fall short. Advocates say it’s hard to get straight answers from Facebook about its content-moderation process, plans for hiring native language speakers, meetings with the government, or the goal of its connectivity efforts, leaving some to suspect that Facebook’s recent overtures are more of a public relations campaign. As governments elsewhere crack down on Facebook and Free Basics, they worry Facebook is targeting Africa because there are fewer protections for user privacy and freedom of online expression. (Kenyanito says only about half of the 50 countries in the African Union have data protection and privacy laws.) What’s more, some critics also suspect that Express Wi-Fi is just a way for Facebook to rebrand its connectivity efforts as something less controversial.
Julie Owono, executive director of Internet Without Borders, says Facebook is facing the same explosive ingredients in Africa that it encountered in Myanmar, including unstable regimes, ethnic tensions, and a flood of new users. She fears that Facebook’s reliance “on algorithms to solve complex issues” means that the brunt of preventing abuse may once again fall on nonprofits. Facebook has pledged to hire 20,000 content moderators in 2018, but will not disclose where those people will be located, partly to protect them.
The need for real transparency became clear during Facebook’s recent activities in Cameroon, which holds elections on Sunday. In September, Facebook helped sponsor a symposium on digital rights and election safety in Yaoundé, Cameroon’s capital. Facebook’s presence shows that the company is “a bit more humble than a few years ago, when they thought they had the solutions to every problem,” Owono says. But just one month earlier, civil society groups were blindsided by news that Facebook met with government officials about fighting fake news during the election. Activists feared Facebook might be planning to censor accounts at the government’s behest. Although concerns were eventually assuaged, Facebook’s initial scripted statements only fueled confusion.
Negotiating with the government becomes fraught in repressive regimes where political parties can manipulate Facebook’s platforms—and may shut down internet access during elections or to silence dissent. “During political moments, the same political actors are the ones fueling misinformation and memes,” says Grace Bomu, a tech policy advocate based in Kenya.
Facebook says it has met with a range of stakeholders in Cameroon, including civil society groups and human rights activists, and made no agreements with the government.
In a statement to WIRED, a Facebook spokesperson said, “We know we were initially too idealistic” about connecting people worldwide, “and didn’t focus enough on preventing abuse or thinking through all the ways people could use the tools on the Facebook platform to do harm. That’s why we have invested in people and technology to build better safeguards. This includes the roll out of third party fact-checking, better detection of bad content, improved enforcement of our policies, and deeper support for digital literacy efforts. There is always more to do, and that’s why we have a dedicated team of product, policy, and partnerships experts who are focused on helping to keep the platform safe.”
But Tessa Wandia, who works at iHub, a hackerspace for technologists and entrepreneurs in Kenya, says Facebook’s connectivity efforts steer users toward choosing Facebook. In Africa, for instance, the Express Wi-Fi app can feature a prominent link to Free Basics, with the tagline “See popular websites for free,” a tempting offer for users in a region where data plans can be relatively expensive. Wandia believes Facebook may be using Express Wi-Fi “to make people quiet down” about Free Basics, and “convince us that they really do have a philanthropic angle.” Facebook says it offers partners the option of including Free Basics in Express Wi-Fi, but it’s not required.
Concerns about social media’s influence are not theoretical. In March, for example, Cambridge Analytica executives were caught on tape bragging about influencing Kenya’s presidential elections in 2017 and 2013. The controversial political consultancy reportedly experimented in Africa in part because of lax privacy rules and access to government data from willing politicians. A case study on Cambridge Analytica’s website says polling data was used to target social media ads to youth voters. Wandia says she reported some inflammatory ads that spread on social media, which contained misinformation and were used to psychologically manipulate citizens. “We have to be worried about how Kenyans are influenced, how they are making decisions,” she says.
To be sure, many of these worries stem from Facebook’s staggering popularity, and would likely exist even without efforts like Express Wi-Fi or Free Basics. Telecom operators in Africa, for instance, often include free use of WhatsApp or Facebook as part of a data bundle to entice users who want to use those services.
But Facebook’s continued push to connect the globe raises questions about who bears responsibility for unintended consequences, which have disproportionately affected people in the Global South. After the violence in Myanmar, we now know how Facebook’s promises to help the developing world can play out.
On Wednesday, Bloomberg reported that a former government official in Sri Lanka had been warning Facebook about abuse on its platform by the Sri Lankan government since 2014. Facebook began to address concerns after the government shut down access, but won’t disclose how many content moderators it has hired.
Mark Zuckerberg’s plan to connect the next billion has been greeted with suspicion since it was announced in 2015, but tensions boiled over when Facebook tried to push Free Basics in India as a philanthropic act. “This isn’t about Facebook’s commercial interests—there aren’t even any ads in the version of Facebook in Free Basics,” Zuckerberg wrote in an op-ed in the Times of India. Eventually, the Indian government banned programs like Free Basics, which favored some content over others.
Some of the skepticism towards Express Wi-Fi is residual distrust from those days. For example, Zuckerberg said Free Basics was for people who had never accessed the Internet before and all content providers were welcome to apply. But a study of Free Basics published by Global Voices, a media organization of advocates and journalists from 170 countries, in August 2017, found that it was often marketed to urban millennials, who used it as a way to access Facebook for free. Within the app, users may have a harder time identifying fake news. The report found that the only local news sites prominently displayed in Kenya and Ghana had either faced pressure to fire journalists or were “known for sensational coverage” and questionable standards.
Facebook says the report reflects the experience of Global Voices volunteers in a limited number of countries, not the people benefitting from the program.
Facebook says it does not track whether expanding Express Wi-Fi has led to more Free Basics users because the programs are separate. But Mark Summer, CEO of Surf the Kenyan ISP working with Facebook, says Free Basics is “very popular,” with Surf’s Express Wi-Fi users. Although Express Wi-Fi is billed as a way to connect communities with limited access, Surf has placed hot spots in major towns and focused on lower-class to middle-class users, who typically already have other, more expensive options, Summer says. “It’s not super low-end users like slum areas or refugee camps and very much not the high end areas where upper class to high income people,” he says. “We provide it in the neighborhoods where the people go and work and shop, where they go on and buy food and go to restaurants and cafes where people sit out and congregate.”
Ellery Biddle, advocacy director of Global Voices, says the availability of Free Basics through Express Wi-Fi can influence users’ media choices. “If you have the one thing that is cheaper than everyone else, it makes it really easy to spread a lot of information quickly,” he says. Facebook successfully neutralized many internet.org critics by positioning its work as a choice between bringing affordable internet access to the neediest members of society or elite concerns about the purity of internet access. But Nikhil Pahwa, founder of news site MediaNama and a key voice during the fight over Free Basics in India, says Facebook does not have to play a central role in expanding access. Fostering competition can lower data prices. Since regulators passed a net neutrality rule in India, he says prices have dropped roughly 90 percent. “There is no need for Free Basics lately,” he says.
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(Reuters) – Facebook Inc on Monday said a technical problem prevented some users from accessing and posting on the social network as well as messaging app Whatsapp and Instagram, and it had mostly fixed the issue.
FILE PHOTO: A Facebook panel is seen during the Cannes Lions International Festival of Creativity, in Cannes, France, June 20, 2018. REUTERS/Eric Gaillard/File Photo
“Earlier today, a networking issue caused some people to have trouble accessing or posting to various Facebook services. We quickly investigated and started restoring access, and we have nearly fixed the issue for everyone. We’re sorry for the inconvenience,” Facebook spokesman Jay Nancarrow said.
Most affected users experienced problems for less than 90 minutes and the problem was not specific to a particular region.
Reporting by Nikhil Subba in Bengaluru; Editing by Cynthia Osterman
LONDON (Reuters) – Facebook is rolling out its Watch video service globally one year after it launched in the United States with original entertainment news and sports content to compete with platforms like Alphabet Inc’s YouTube.
FILE PHOTO: People are silhouetted as they pose with mobile devices in front of a screen projected with a Facebook logo, in this picture illustration October 29, 2014. REUTERS/Dado Ruvic/Illustration/File photo
Facebook’s Head of Video Fidji Simo said Watch was gaining real momentum in a crowded marketplace because it was built on the notion that watching videos could be a social activity.
“Every month more than 50 million people in the U.S. come to watch videos for at least a minute on Watch, and total time spent watching video on Facebook Watch has increased by 14 times since the start of 2018,” she told reporters.
“With Watch … you can have a two-way conversation about the content with friends, other fans or even the creatives themselves.”
Facebook said eligible creators would be able to make money from their videos using its Ad Breaks service in Britain, Ireland, Australia and New Zealand as well as the United States from Thursday, with many more countries set to follow.
Simo said publishers were making “meaningful revenues” from its automated video advertising system on the platform, which has featured shows such as beauty mogul Huda Kattan’s “Huda Boss” and live “Major League Baseball” games.
“We know it’s been a long road but we’ve worked hard to ensure that the Ad Breaks experience is a good one for both our partners and our community,” she said.
Ad revenue will be split 55 percent for the content creator and 45 percent for Facebook, the same ratio as in the United States, Simo said.
Publishers need to have created three-minute videos that have generated more than 30,000 one-minute views in total over the past two months and must have 10,000 followers to participate in Ad Breaks, Facebook said.
Simo said Facebook was working on a variety of other options for creators to make money, such as branded content and the ability for fans to directly support their favorite creators through subscriptions.
“(Fan subscription) is something that is rolled out to a few creators now, but we are planning on expanding that program soon,” she said.
Editing by Kirsten Donovan
WEST CHESTER, Pa. (Reuters) – The Home Shopping Network is getting an image makeover.
A studio set is seen at the QVC Studio Park in West Chester, Pennsylvania, U.S., June 4, 2018. Picture taken June 4, 2018. REUTERS/Brendan McDermid.
A U.S. television network where shoppers can buy everything from electronics to kitchen gadgets, the Home Shopping Network is overhauling its lineup to offer more beauty products while adding streamed video content to win over shoppers without cable TV.
A division of Qurate Retail Group, the network is facing growing competition from Amazon Inc. and Evine Live Inc for consumers like 24-year old Erin Bounds, who regard buying products through TV shows a relic of the past.
“Someone who is 24 doesn’t have the time nor desire to watch an hour-long show about a piece of jewelry or a vacuum when they can get an answer and the product quicker and probably cheaper on Amazon,” said Bounds, a resident of Ellicott City, Maryland.
For decades, the main difference to shoppers between HSN and Qurate’s other shopping network, QVC, typically came down to variations in branding and merchandise, with HSN selling more electronics. Qurate acquired HSN in late 2017 for $ 2.1 billion so the two shopping networks could join forces to better compete against Amazon and its home-shopping-style online video promotions.
Qurate executives told Reuters they now are culling HSN’s core merchandise offerings to eliminate many higher-priced electronics and some home goods, such as vacuum cleaners and blenders.
Instead, they are adding more niche cosmetic and apparel brands to help draw some distinction with QVC. They are also pushing both QVC and HSN to pursue younger shoppers with click-to-buy links on Instagram and Facebook Live for items such as earrings, shoes and Vince Camuto jeans, in a bid to spark a rebound in demand.
Second-quarter revenue at HSN declined 12 percent to $ 473 million from $ 533 million a year later the company announced Wednesday. Stock in the company, which counts media mogul John Malone as one of its largest investors, is down about 8 percent year to date, compared with a 14 percent increase for the Nasdaq index, and 64 percent increase for Amazon.com year to date.
“You’re seeing the impact of them digesting a large organization that is clearly not growing if you look at the numbers,” said Ben Claremon, partner and research analyst at investment firm Cove Street Capital, one of Qurate’s shareholders.
“There’s just not the degree of demand for home shopping products, and the desire to spend hours of the day watching them diminishes as you go down in age,” he said.
BALANCING BLUE LIPSTICK WITH BRACELETS
The new strategy is aimed at creating more distinction with the two cable channels after the merger, according to Rob Robillard, the new VP of Beauty Integration at Qurate.
In beauty, for example, one of HSN’s top selling products is Too Faced “Unicorn Tears” blue lipstick, which sells for roughly $ 22. One of QVC’s best products is the Doll 10 Nude lipstick with a price tag of around $ 25, noted Robillard.
“We were sort of hoping there would be this real big difference between HSN and QVC,” he said. “But the two are actually very similar.”
Qurate will partner with Robin Burns-McNeill, chairman of Batallure Beauty, a company specializing in brand strategy, product and package development, sourcing and manufacturing in the fragrance, cosmetics and skincare categories, to create a collection of proprietary beauty brands, the company told Reuters exclusively.
The first manufactured beauty products from this partnership are slated to launch in fall 2019 on QVC.com, and, if all goes well, the company said they would likely tap on Burns-McNeill’s shoulder to create proprietary brands for HSN as well.
They have a tall order. Amazon is the top online destination for beauty and the fifth-most-popular retailer for skincare and cosmetics, according to Coresight Research, behind leaders Walmart, CVS Health, Target Corp and Walgreens. QVC and HSN do not rank on the list.
In March 2016, Amazon launched “Style Code Live,” a daily live fashion show which has since gone off-air.
This June, Amazon unveiled Prime Wardrobe in the United States, allowing Prime members to try on clothing, shoes, and accessories before purchase. Customers have up to seven days to try their clothes on at home, and are charged only for those items they choose to keep.
Celebrity-driven shows and videos on QVC still have their upside, according to vendors such as Xcel Brands Inc Chief Executive Robert D’Loren. A QVC apparel vendor for more than six years, D’Loren cites on-air appearances of fashion designer and QVC host Isaac Mizrahi – D’Loren’s largest, most successful brand on QVC – as strategic advantage for the home shopping network.
D’Loren thinks Qurate, which currently accounts for 60 percent of Xcel’s brand volume, is well-positioned to take on competitors Amazon.com and video retailer Evine, and that it’s “only a matter of time” before millennials like Bounds give Qurate’s QVC and HSN a shot.
“There is something to tuning in, watching, having product fully demonstrated to you that is unique and has great value, and I haven’t seen that anywhere else in the market,” he said.
Editing by Vanessa O’Connell and Edward Tobin
Facebook’s algorithm that triggers balloons and confetti when users write the word “congratulations” on the site is usually just a festive add-on.
But it took an inadvertent turn in Indonesia following a deadly, 6.9 magnitude earthquake on the island of Lombok on Sunday. Users took to Facebook to express concern for those affected by the earthquake, employing the Indonesian word “selamat”—which can mean safe or unhurt, but can also mean congratulations depending on the context.
The word was misinterpreted by Facebook’s algorithm, accidentally prompting the celebratory animation.
Facebook quickly apologized for the mishap, noting that the feature is “widely available” on the site globally, but expressed regret “that it appeared in this unfortunate context.” Lisa Stratton, a Facebook spokesperson further explained to Motherboard that they have since turned off the feature locally, and said that their “hearts go out to the people affected by the earthquake.”
Herman Saksono, an Indonesian PhD student in human-computer interaction, expressed surprise that Facebook hadn’t accounted for the double meaning of “selamat,” telling Motherboard that “People use the word interchangeably.”
“Researchers spend a lot of time before launching a function like this to make sure it truly fits the culture and practices in languages in which it will be used,” he said. “I would expect Facebook to do the same, given all the resources they have. I guess [they] missed this one.”
(This is a guest post from Appilco Head of Platform and Modern Monopolies co-author Nicholas Johnson.)
This week, the dream for what WhatsApp could have been was officially pronounced dead. What happened? Facebook announced a host of new business-oriented features that are coming to WhatsApp in a push to finally have its biggest acquisition generate meaningful revenue. Ads are included, contrary to the original vision for WhatsApp, whose founders once called advertising an “insult to your intelligence.”
As I’ve written previously, WhatsApp’s original direction presented an opportunity for a true Facebook competitor to emerge. But since Facebook’s $ 19 billion acquisition, it’s become increasingly clear that WhatsApp will inevitably end up looking like yet-another Facebook platform. That is to say, it will be driven by ads and the mass collection of user data, as required by Facebook’s main revenue model.
With the WhatsApp Business API, this transition has kicked into high gear.
Show Me the Money
WhatsApp’s business API will enable businesses to establish an official presence on WhatsApp, similar to how they exist on Facebook today. However, this doesn’t mean you’re suddenly going to start getting spammed by messages from companies, as customers still have to contact a business on WhatsApp first before the business can send them messages.
After that, using the API, businesses can respond to messages from customers. They can also send them updates such as order confirmations, delivery notices, appointment reminders and more. Many businesses will also use it for customer support, and the API will likely enable WhatsApp to plug into existing CRM solutions that businesses use for that purpose.
As for cost, the API will let businesses respond to customer inquiries for free within 24 hours. After that they will pay a fee per message sent of between half a penny to 9 cents, depending on the country. This framework will encourage businesses to respond to customer messages quickly. It also helps eliminate the incentive for businesses to spam customers after the initial outreach, as each message will cost them money. If that message doesn’t create real value for the customer, you won’t want to send it.
Additionally, WhatsApp will also be introducing ads, not all of which will appear within the WhatsApp app itself. How does that work? Business accounts on WhatsApp will soon be able to place ads on Facebook (and likely Instagram too) that let customers click to open up a WhatsApp message with that business. Additionally, WhatsApp will be adding advertisements to its Status platform, which is its version of Facebook’s many Snapchat Stories clones. Facebook has been testing these ads already with Instagram Stories, and WhatsApp Status ads will tie into the same Facebook ad system as Stories.
Facebook’s Stalling Revenue Engine
Taken together, these moves remove much of what made WhatsApp stand out from the rest of the Facebook ecosystem. Following the departure of WhatsApp’s founders, every new change makes WhatsApp more and more like Facebook.
At its core, Facebook, much like Google, is driven by a giant money-making advertising engine. Eventually, everything that Facebook touches gets pulled into its vortex. Now WhatsApp, despite promises to the contrary to both users and regulators, will be no different.
For Facebook, the shift comes on the back of a poor showing in its latest quarterly earnings and as increasing investments in safety and community monitoring are likely to compress its profit margins in the years ahead. Facebook appears to be moving decidedly out of growth mode and into profit-taking mode with all of its platforms. Now that WhatsApp is one of the largest messaging platforms in the world, it’s well positioned to turn into the monetization engine Facebook likely envisioned when it shelled out $ 19 billion.
SAN FRANCISCO (Reuters) – Revenue forecasts from Facebook Inc (FB.O) that alarmed investors, fueling the worst day ever for its shares on Thursday, add to the pressure on its Instagram unit to win over more of the ad buyers that have long found success on the company’s flagship app.
FILE PHOTO: The Facebook logo is displayed on their website in an illustration photo taken in Bordeaux, France, February 1, 2017. REUTERS/Regis Duvignau/File Photo
Instagram and Facebook users see about the same number of ads, but Instagram ad prices are half of what Facebook charges because of the limited number of advertisers vying for spots on Instagram, four ad buyers said.
Investors have been counting on revenue from Instagram to overcome stalling usage of Facebook’s core app. But the gap it has to fill has widened sooner than expected.
The social media company suffered the biggest one-day wipeout in U.S. stock market history, losing more than $ 120 billion in market capitalization as shares fell 19 percent a day after executives forecast years of lower profit margins due to regulatory pressure over privacy.
Instagram users are not accustomed to clicking on links in posts, which makes the service less effective at generating online purchases than Facebook, said Erik Huberman, founder of the ad buying agency Hawke Media.
Data about viewership of ads is lacking in comparison to Facebook, he added.
“There are fundamental issues with the platform…which means any type of modern marketer would be hesitant to increase spend on Instagram,” Huberman said.
Some advertisers fond of Facebook are seeing subpar results on Instagram, according to advertising buyers. Others have been stymied by the higher bar for eye-catching content on Instagram and a general unease among advertisers about a newer service, the ad buyers said.
“A lot of businesses don’t put ads on Instagram because the reality is they don’t have the content to play on Instagram,” said David Herrmann, advertising director at Social Outlier, which spends nearly $ 15 million each quarter on Facebook ads on behalf of clients. “A local flooring business is not going to appeal on Instagram, like on Facebook.”
Instagram is its parent company’s fastest-growing slice of revenue, but it touts 4 million fewer monthly advertisers globally. As Instagram has shown more ads, the average price per ad across Facebook’s entire family of apps has declined in two straight quarters after a year of upswing. A new privacy law in Europe also has affected prices.
The latest results prompted Stifel, Nicolaus & Co analyst Scott Devitt to lower an Instagram revenue estimate for 2019 to $ 13 billion from $ l4.64 billion, with lowered expectations for prices and views.
Instagram and Facebook declined to comment for this story.
Company executives have reason for optimism. The average price for an ad seen 1,000 times was $ 4.70 on Instagram during the second quarter, rising twice as fast as standard Facebook ads compared with the prior quarter, according to data tracked by marketing software firm Kenshoo.
Instagram has worked for advertisers seeking name recognition or posting attractive video content, such as movie trailers, said Mark Smith of the ad buying agency True Interactive, which spends $ 25 million annually on Facebook and Instagram for clients including Redbox and Montage Hotels.
New features for users and advertisers, including replicating an ad design tool rival Snap Inc (SNAP.N) launched last year, could help reduce the apprehension among other advertisers, said Chris Costello, Kenshoo’s senior director of marketing research.
Earlier this year, Instagram introduced options that automatically formats advertisers’ videos and let them have multiple photos in an ad. But companies still must have higher-quality content than on Facebook to get noticed, Costello said.
Tom Buontempo, president of ad agency Attention, said a first step is getting more companies to open free Instagram accounts, which is needed to advertise.
“Surprisingly, there are still quite a few advertisers who haven’t leveraged the potential of Instagram’s ad products,” he said.
Reporting by Paresh Dave; Additional reporting by Sheila Dang; Editing by Greg Mitchell and Lisa Shumaker
BEIJING (Reuters) – Facebook has set up a subsidiary in China and plans to create an “innovation hub” to support local start-ups and developers, the social media company said on Tuesday, ramping up its presence in the restrictive market where its social media sites remain blocked.
FILE PHOTO: A Facebook panel is seen during the Cannes Lions International Festival of Creativity, in Cannes, France, June 20, 2018. REUTERS/Eric Gaillard/File Photo
The subsidiary is registered in Hangzhou, home of e-commerce giant Alibaba Group Holding Ltd, according to a filing approved on China’s National Enterprise Credit Information Publicity System last week and seen by Reuters on Tuesday.
“We are interested in setting up an innovation hub in Zhejiang to support Chinese developers, innovators and start-ups,” a Facebook representative said via email, referring to the Chinese province where Hangzhou is located. Facebook has created similar hubs in France, Brazil, India and Korea to focus on training and workshops, the spokesperson said.
Facebook’s website remains banned in China, which strictly censors foreign news outlets, search engines and social media including content from Twitter Inc and Alphabet Inc’s Google.
Setting up a company-owned enterprise in China does not mean Facebook is changing its approach in the country, the company said, adding that it was still learning what it takes to be in China.
Last year Facebook’s messaging app WhatsApp was blocked in the run up to the country’s twice-a-decade congress, and it has remained mostly unavailable since.
The filing listed only one shareholder of the new entity, Facebook Hongkong Ltd.
While censorship controls have hardened under Xi Jinping, who was formally appointed president in 2013, U.S. tech firms with blocked content are increasingly looking for new ways to enter the market without drawing the ire of regulators.
Google has several hundred staff in China and recently launched its own artificial intelligence (AI) lab. It has also tentatively launched several apps for the Chinese market in recent months, including an AI drawing game and file management app.
Apple Inc has also heavily modified its app stores to fit Chinese censorship restrictions in the past year, removing hundreds of apps at the request of regulators.
Reporting by Cate Cadell, Lusha Zhang, Se Young Lee and Jonathan Weber; additional writing by Peter Henderson; Editing by Kirsten Donovan, Emelia Sithole-Matarise and Cynthia Osterman