Facebook, Francis Haugen, Francis Hogan discussed on BTV Simulcast


To be known as the Facebook files a trove of internal documents taken by whistleblower Francis Hogan and now obtained by 17 news outlets including Bloomberg They painted darker and more dangerous picture of the social network and to just Facebook has been hiding key information from investors I want to bring in elevation partners founder and early Facebook investor roger mcnamee who's been sounding the alarm on Facebook for years even wrote a book about it roger It's great to have you back on the show I'm curious what you find most alarming about these documents that have been obtained by Bloomberg and also the revelation of Francis haugen over the last couple of months What troubles you the most So to me Francis haugen is incredibly courageous for bringing these documents out The impact of them is that they've shifted the conversation about Facebook from a focus on free speech issues to where it really belongs which is on a business model that essentially puts 3 billion people onto a network with no boundaries and then unleashes a business model that promotes inflammatory emotions So hate speech disinformation and conspiracy theories are given an economic advantage on Facebook And the result is that ideas from the French things like antivirus and white supremacy have been mainstreamed And that's under my democracy It's undermined public health It's undermined privacy And this is a huge problem And if you're an investor Facebook's been a great stock for you but on a looking forward basis you have to ask the question if the U.S. loses its ability to be a democracy And if each one of us loses the ability to make our own choices because they're being made by Internet platforms is that a good trade right I think that's the real question that comes up here And if you're an investor in Facebook today it was a great day for Facebook Facebook up at the close Facebook up three and a half percent after the close on the back of these results that are mixed and on the same day that these thousands of pages of documents have been poured through by multiple different news organizations If that's not going to send Facebook stock down what is Well to be clear I don't think the stock's a good measure of what's going on here I think the stock market operates in a completely different time scale And so I think investors are making the correct judgment which is the numbers were terrific Police relative to what you would have expected Looking at snap the other day the impact of Apple changing privacy had a dramatic effect on step At Facebook they have a lot of dials to turn They can lower the quality of the ads that they show They can allow people of new users onto the site that if you will or not authentic there are lots of dials that are available to them to make the numbers look good But that's very short term And I think investors have a super short time horizon here Whereas the stuff going on with government is going to take time to process You have legal issues relative to the SEC with disclosure relative to insider trading There's a big case in Delaware 6 large pension plans that are accusing Facebook of insider trading around Cambridge Analytica These things are felonies There are Department of Justice cases relative to price fixing additional advertising related to there should be an investigation of the whistleblower's information about human trafficking or about the January 6th insurrection where again Facebook has been implicated time and again in both the radicalization of people into QAnon and into stop the steel and then allowing them to organize the protests and then the insurrection itself on Facebook And it's obvious management know about all of this stuff And they always prioritize profit Does time spent on Facebook among teens dropping 16% Does that alarm you Is that something that Facebook should have been more transparent about Is that something that investors had known coming directly from the company itself would the stock be continuing to rise Would revenue be continuing to grow $30 billion quarter after quarter So I think the issues that Facebook really faces is that in North America and Western Europe It's most profitable markets It has reached saturation of the population And there's no question that TikTok is draining people away from Instagram And I look at this and the bad press that Instagram is getting right now should accelerate that departure And I don't think there's anything Facebook can do about it that's legitimate They love to change the conversation to the metaverse but that technology is not good enough to replace the whole that is being left in their business Facebook is a mature company It's not going to grow as rapidly and the numbers are higher in the short run That's coming out of the future And investors just need to be more careful They should really make an opportunity Do you think the metaverse actually is for Facebook roger I mean Mark Zuckerberg wants to bet the future on this a potential name change on this I mean is that going to pick up the slime chain has nothing to do with this The name changes about distracting us from the fact that the company is going to face a series of legal problems and zuck personally is going to face the legal problems here And this is a real test for our system We've allowed this company in Google and others to run without any supervision They've caused tremendous harm They've made investors a fortune And investors are incredibly thankful but the rest of the country is pretty unhappy about it And the question is are we going to do something to try to restore some balance or are we not going to do so And the metaverse is literally a dream And if you look at the demos they're horrible And combine mind Facebook is going to spend so much time dealing with the problems that are being exposed now both in court and in Congress The metaverse but if they ever get it to work it's going to come very late And you're not going to want to wait from here to there on the hope of the metaverse The name change is literally a distraction It's literally something that they're just trying to do two things To get us to look elsewhere and they want to somehow find a way to insulate Mark Zuckerberg from legal liability for the problems that have already been created And at this point at this point roger what kind of regulation do you think is realistic and right Reid Hoffman and investor in Facebook in the early days just like yourself told me that he's disappointed in Facebook as well But he thinks that breaking up Facebook is the wrong approach because that'll make it even harder to centralize all of these.

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