Facebook: It's About the Money

1. Facebook : It’s About The Money CASE 2.2
1 MBA_Batch2_UMK_Kch/M7/GST5803/Information Systemand E-Commerce/P14D397P
CASE STUDY 2.2
FACEBOOK: IT’S ABOUT THE MONEY
a) Perform an ethical analysis of Facebook. What is the ethical dilemma presented
by this case?
Facebook is the leading Social Networking Site of the World. Facebook mission is to
make the world more open and connected. Facebook helps Internet users stay
connected with their friends, families, and colleagues. It helps them discover and
learn more about what is going on in the world around them. It helps them express
themselves by sharing their opinions, ideas, photos, and activities. However, what the
company actually does is to share tons of information about users with large
multinational advertisers to bring the benefit for it. Advertisers can engage with users
based upon the information shared by users such as age, gender, location, education,
work history or specific interests. Facebook CEO Mark Zuckerberg often says that
people want to be more open and connected. It's unclear whether that is truly the
case, but it is certainly true that Facebook wants the world to be more open and
connected because it stands to make more money in that world.
b) What is the relationship of privacy to Facebook’s business model?
Talking privacy to Facebook is a bit ironic. Facebook’s entire business model is
based on aggregation and sharing user information. They give people a free social
media platform to use and in turn sell advertising and insights based on what they
learn about user. Facebook has massive capabilities to collect, store and analyze data.
This allows Facebook to sell very targeted advertising. Therefore, privacy is the
Facebook business model.

2. Facebook : It’s About The Money CASE 2.2
2 MBA_Batch2_UMK_Kch/M7/GST5803/Information Systemand E-Commerce/P14D397P
c) Describe the weaknesses of Facebook’s privacy policies and features. What
people, organization, and technology factors have contributed to those
weaknesses?
The weakness behind Facebook's privacy issues was a lack of communication
between Facebook and its users. Users were not aware that they were able to control
what information was being shared with external parties.
Facebook’s use of their Beacon advertising service caused the first problem for users.
This service served as a way to inform users of purchases and activities of their
friends outside of Facebook. There was two problems with this service, first it
function of the “news feed” was met with opposition from users because they felt it
was too invasive. Instead of only sharing status updates the news feed shared
additional information such as profile updates, adding new friends, and adding new
applications.
A organization which called the civic action group MoveOn.org created a face book
group to against the Beacon. So finally the Facebook.com change this service and
gave their users the able to disable it completely.
There were two problems with this service, first it was an opt-out service, meaning the
users themselves had to turn off the service to not have their information shared, and
second even when users turned off the service it continued to share their information.
The introduction of the “news feed” was met with opposition from users because they
felt it was too invasive. Instead of only sharing status updates the news feed shared
additional information such as profile updates, adding new friends, and adding new
applications.
Facebook handling incorrectly user information when deleting their accounts also
caused a backlash for Facebook. Facebook servers would keep user information
permanently, with the reasoning that it would be easier for the users to reactivate their
accounts if they chose to.
d) Will Facebook be able to have a successful business model without invading
privacy? Explain your answer, Are there any measures Facebook could take to
make possible?
Without invading privacy Facebook will be able to have successful business model.
Refer from the case study we can see that in 2012, Facebook agreed to allow users to
opt in to its sponsored Stories services, which serves advertisements that highlight
products and business that all of Facebook users are using.
Users can control and see which of their actions on facebook generate
advertisements that their friends will see.
Sponsored Stories are one of the most effective forms of advertising on Facebook
because they don’t seem like advertisements at all to most user.