Facebook's privacy vs. biz challenge

Facebook displayed on a laptop screen.

TEXT OF STORY

Kai Ryssdal: The social networking site Facebook is working on a balancing act of its own. Users' privacy versus the need to, y'know, make money. Not for the first time, Facebook's been in the crosshairs the past couple of weeks over what it's doing with users information. It's the biggest backlash in the company's short history. So, in San Francisco today Facebook rolled out some new privacy rules.

But as Jeff Horwich reports, once something's out there online, it's tough to take it back.


Jeff Horwich: For a company that knows so much about its customers, Facebook really misread them.

Mark Zuckerberg: I think a lot of what we were trying to do, we just didn't communicate as well as we could have, and a lot of it got lost in that.

CEO Mark Zuckerberg said today on a conference call Facebook was trying to give users new ways to find each other. Instead it gave advertisers a new way to find them. In April, many woke up to find new personal information public to the world. Facebook was also feeding info to sites like Pandora and Yelp. You could turn all this off -- one click at a time. Now, Zuckerberg says...

Zuckerberg: There's going to be one simple control for how you want to share all the stuff. It applies to all of the content on the site retroactively.

Too late for users like David Macknet. He even threw an online "Quit Facebook" party to try to get friends to ditch the site as well.

David Macknet: I don't know that I would ever trust them again. The changes have been so distasteful that, how can I be sure?

And this latest redo might permanently turn off users like Christy Marshall, who's already feeling Facebook fatigue.

Christy Marshall: II'm kind of like, "Ugh." I just feel tired. I just don't want to really be on it any more.

Facebook has 450 million users. What it doesn't have is a way to maximize revenue from that huge trove of data. Justin Smith runs the blog "Inside Facebook."

Justin Smith: Facebook's challenge is to find the right middle ground by being good stewards of the information that people have shared with them and trusted with them, while at the same time finding ways to build a business around that.

Long-term: No money, no Facebook. Of course, lately, more users are thinking they might be OK with that.

I'm Jeff Horwich for Marketplace.

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