Is Cambridge Analytica’s closure Facebook’s revival?

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As the news of a data breach of unheard scale met the world, news as to the magnitude of the resultant damage that Facebook was to incur met its executive directors and shareholders. Facebook share value was said to have declined by 7 per cent in the immediate aftermath, the most considerable single day decline since 2014.

Although the congressional testimony session at which Facebook executive director Mark Zuckerberg was interrogated has managed, vis a vis share prices, to modestly revive its fortunes, the longstanding data-protection issues, and the concomitant reputational damage that will have been generated by this, still threatens its return to the pre-shock position.

It is thought in some quarters, albeit rather optimistically, that the recent announcement that Cambridge Analytica and its parent consultancy company SCL group are to terminate their operations, will in itself lead to a reversal in the current status of consumer confidence and thus the prospects of Facebook. Recovery however, as opined by Kyle Taylor of the New Statesman, will not lie in a collection of symbolic gestures (such as the acceptance of fault on being summoned before committees) designed solely to reassure without providing substantial redress. From the manner in which Cambridge Analytica have announced closure, citing alienation by suppliers and therefore customers in the wake of the media coverage, rather than the admitting guilt in conduct, it is possible to infer that such data breach outbreaks, not least those that undermine democratic processes by undue influence, will not be a thing of the past.

Cambridge Analytica, even at the point of closure, contend that they acted in accordance with the law and make the claim of merely having engaged in what was “widely accepted as a standard component of on-line advertising in both the political and commercial arenas”. Reference to company’s house reveals that its executives have established a new company called Emerdata.

In other words, a fundamental breach of trust; in which the respective rights of privacy, autonomy and freedom from discrimination are not observed still may not result in a breach of law. There is also doubt as to whether the recent introduction of European data protection regulations, due to come into force on May 25 will act as antidote to this. As Andrew Rawnsley said, writing for the Guardian, politicians have sought to control digital giants with rules drawn up for the analogue era.

What emerges from Facebook’s review of practice, as a result of such regulatory weakness, which strengthens to weaken that serves to dismiss rather than to embody consumer confidence, is a business model that is premised on the notion, as suggested by Ira S. Rubinstein, of consumer empowerment. Such empowerment it is widely thought can only be achieved in the rethinking and subsequent redesign of the informed choice model, whereby it may constitute an actual exercise of consent. Tillburg University has found that a lack in consumer confidence acts as a barrier to growth.

The protection of fundamental rights important in sustaining and enhancing consumer engagement with Facebook cannot simply depend on the infrequent trial by media, important though it is. Prevailing big data practices such as data mining demand an adequate response that coheres to the challenges it raises. Only then, with the establishment of ethical data practices, will Facebook be able to experience a renaissance in market success.

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