Zuckerberg’s Day On Capitol Hill  

FTC Could Hear Testimony From Facebook Execs

Facebook CEO Mark Zuckerberg is halfway through a two-day trip to Capitol Hill, on what many have described as his “public apology tour.” This, of course, followed the revelation last month that the 250,000 users who had downloaded and taken a personality test developed by Cambridge Analytica had resulted in improperly gained access to personal information from their social networks – some 87 million Facebook users.

The blowback has been brutal: Facebook’s share price has taken a beating, some advertisers pushed pause, #DeleteFacebook trended as legislators on both sides of the aisle found common ground in denouncing the data privacy lapses of the giant social network that connects more than two billion people all over the world.

Those legislators wanted their chance to ask Zuckerberg to explain what happened – in person.

So, to Washington he went.

Over a nearly five-hour span, Zuckerberg fielded questions from legislators on most of the things Facebook has apologized for “breaking” over the last several years: fake news, Russian infiltration of the American election system, monopolistic business practices, racial targeting, mayhem broadcast live on its platform, hate speech, cyber bullying, data privacy and genocide in Myanmar.

“We have made a lot of mistakes in running the company. It is impossible to start a company in your dorm room without making mistakes,” Zuckerberg said of the errors made during the “move fast and break stuff era.” “Overall, I would say we’re going through a broader philosophical shift.”

“It’s clear now that we didn’t do enough to prevent these tools from being used for harm as well,” Zuckerberg continued. “And that goes for fake news, foreign interference in elections and hate speech, as well as developers and data privacy.”

When it was all said and done, Zuckerberg’s performance was well-reviewed – and the U.S. Senate’s, by and large, was not. Facebook even saw its stock price tick up around 4 percent in after-hours trading. Commentators noted that Zuckerberg looked calm, collected and clearly well-prepared for the questions he was facing, and had answers readily at hand for most. He even earned some laughs on the floor, when offered a break by the chair – which he initially passed on to answer another 15 minutes’ worth of questions.

Incidentally, Facebook’s CEO earned a bigger laugh about seven minutes later, after finishing up his Q&A with Texas Senator Ted Cruz and deciding he could actually go for that break after all.

Senators’ lower reviews for the day’s Q&A largely stemmed from the fact that, according to many, it seemed apparent that many of them gave the strong impression that they simply didn’t know enough about Facebook or how it works to offer much in the way of follow-up pushback against Zuckerberg’s remarks.

Others did, and leveled some tough questions to the CEO.

Delaware Senator Chris Coons noted that his day had started by discovering someone had made a fake Facebook page in his name, and then used it to friend a whole lot of Russian bots. Coons then noted that resolving this type of situation falls entirely on the users’ shoulders, before wondering what responsibility Facebook had to act as an advocate for its users.

Coons also noted – along with New Jersey Senator Cory Booker – that Facebook’s platform had recently shown to have been used by advertisers to limit who could see their ads and products by race, something that Booker told Zuckerberg is not only wrong, but in the case of things like financial services products, also illegal under the Equal Credit Opportunity Act of 1974.

Senator Richard Durbin asked Zuckerberg if he cared to share the name of the hotel he stayed in the night before his appearance, or the identity of anyone he had been texting. When Zuckerberg bemusedly declined, Durbin pointed out that this was probably out of a concern for his personal privacy.

“I think that may be what this is all about: your right to privacy, the limits of your right to privacy and how much you give away in modern America in the name of, quote, ‘connecting people around the world,’” he said.

Others, like Louisiana Senator John Kennedy, noted that for all of Facebook’s recent talk about increasing trust and transparency, they were kipping over some of the very simplest things they could do to improve the situation.

“Here’s what everybody has been trying to tell you today and I say this gently: Your user agreement sucks. The purpose of that user agreement is to cover Facebook’s rear end. It’s not to inform your users about their rights,” said Kennedy. “I’m going to suggest you go home and rewrite it, and tell your $1,200-dollar-an-hour lawyer … you want it written in English, not Swahili, so the average American user can understand.”

South Carolina Senator Lindsey Graham was one of the few who questioned Zuckerberg who seemed to actually throw him off his game a bit, with a question about the identity of Facebook’s competitors.

Zuckerberg tried to dodge the question a bit, noting that the network has many competitors across many categories who all do various parts of what Facebook does. Graham, however, was adamant that Zuckerberg name a single competitor.

“Let me put it this way: If I buy a Ford and it doesn’t work well and I don’t like it, I can buy a Chevy. If I’m upset with Facebook, what’s the equivalent product that I can go sign up for?”

When he was unable to come up with a competitor in that sense, Graham directly asked if Zuckerberg felt that Facebook is a monopoly (he doesn’t) and noted that businesses are usually regulated by competition or by government regulation. Facebook, it seems, lacks real direct competition.

“Here’s the question that all of us got to answer: What do we tell our constituents, given what’s happened here, why we should let you self-regulate?”

And that remains the $477 billion question – Facebook’s market cap – at the end of the yesterday’s marathon hearing, and in advance of the second part that’s set to kick off today.

It was a question that came up again and again throughout the hearing, with varying levels of sharpness.

“We’ve seen the apology tours before … I don’t see how you can change your business model unless there are different rules of the road,” Blumenthal noted.

And though Zuckerberg signaled throughout the hearing that he is open to working with regulators on designing regulations, he was guarded and fairly unspecific about what he thinks those regulations could and should entail.

Which means, coming out of today’s hearing – positive performance reviews to the side – Mark Zuckerberg still has two issues on his plate.

The first is senators, who, for a variety of reasons and from both sides of the aisle, are increasingly interested in regulating Facebook. The second is that at best, only about half of them seem to really understand what Facebook is and how it works, as the ability to regulate Facebook is not dependent on whether or not an individual senator actually understands it.

Day one is done on the Hill for Mark Zuckerberg – and while he seems to have done well enough to quell some of the terror, it also looks like Facebook has a lot of very powerful hearts and minds still to win.

Day two is starting now. We’ll keep you posted on how it unfolds.