Will Privacy Issues Hurt Facebook?

Question: Will concerns about privacy be the undoing of Facebook?

Clay Shirky:
No, I think Facebook is going to be fine. Facebook has a long history of planning a change in the service that’s good for them in some way or another, overstepping their bounds, apologizing and scaling back—but not scaling back to the point they were before the change.  In a way, Facebook now uses the overstep-apology-reaction pattern as a way of saying how far they can go at any given cultural moment. 

The other thing about Facebook is... Facebook is in a way our current target for our worries about privacy in exactly the same way the music industry obsessed about Napster, newspapers obsessed about Craig’s List... Which is to say the logic that Facebook is exposing is in many ways logic that’s implicit in the Internet itself—Facebook just happens to be its current corporate avatar.  But if Craig’s List had died out in 2005, it wouldn’t have helped the classified ad business much because somebody else would have figured it out and done it. 

So, it seems to be that a lot of the trouble that Facebook is in right now, is really people grappling with what the Internet means for privacy rather than Facebook. What I do think is that Facebook is probably close to the outer limit of what it can get away with in terms of privacy.  I wish, as many people do, that they were a better actor on the subject of privacy than they have been, but their business model’s pretty clearly: maximizing sharing, maximizing disclosure, maximizing number of Facebook URL’s in circulation on the open Internet.  I think that they will have to fight harder to get out from under the problems they’ve currently created.  But I don’t think any significant challenger to Facebook is going to arise in the next couple of years.  And however much bowing and scraping they have to do now, including possibly before a Congressional Committee, I don’t believe it’s going to clip their business much in the long term.

Recorded May 26, 2010
Interviewed by Victoria Brown

Mark Zuckerberg's company has a long history of intruding on users' privacy, apologizing, and then scaling back. But it never scales back all the way.

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