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Five Billion Dollars of personal information

Facebook’s IPO is expected to be largest ever sale of shares by a US web company, with the business looking to raise raise $5bn. That would dwarf Google’s float in 2004, which raised $1.67bn.

The issue puts front and centre the commercial value of our personal information and raises some serious questions about the protection of privacy.

We’ve blogged previously on the latest functionality change, the ‘timeline’ and how it impacts on privacy. The company is under investigation in several countries for it’s data retention and storage policies, while others have highlighted the worrying amount of information the company gathers on people who do not even have a profile.

Facebook’s business is based on advertising, like most online companies. The number of ads on the site rose by 42% in 2011, while the price per ad grew by 18%. To increase the amount of money it can charge for ads, Facebook needs to convince advertisers that it is better able to target advertisements than alternative services. The more personal information about us Facebook has, the better Facebook can target advertisements, and the more it can charge for them.

So if investors start to see Facebook’s numbers sliding – and given that 2011 earnings were around $500m lower than analysts expected that isn’t too remote a possibility – the company may find itself forced to choose between user privacy and profit.

Indeed, they may see privacy as an obstacle to profit. In the five core values published by the company, the word privacy does not appear once.

As Facebook’s social mission to make the world more ‘open and connected’ meets the harsh reality of the stock market, consumer privacy is more at risk than ever before.

Posted on by Big Brother Watch Posted in International, Online privacy, Privacy, Social Networking, Technology

One Response to Five Billion Dollars of personal information

  1. Pingback: Facebook, privacy and the dark web – Joshua Lachkovic – The Kernel

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