By Anshia Dutta
Facebook was recently enveloped by the Russian scandal and was publicly criticised for not being able to connect the dots to the conclusion that the ads which were being paid in rubles were coming from Russia. It faced a political backlash for its inability to uphold the integrity of the US elections.
The online social media and social networking service is an American for-profit corporation that was started in February 2004. It is headquartered in Menlo Park, California, USA.
It was reported in early September that the Internet Research Agency, a Russian online operative, had spent $100,000 on more than 3,000 ads that promoted divisive social and political messages that ran in the US between 2015 and 2017. These ads appeared to target politicians on a range of hot-button topics like police brutality, immigration, race relations, and LGBT rights. These ads were viewed by up to 126 million people.
Facebook faced harsh criticism over its failure to prevent Russian operatives from using its platform for election meddling, and its ability to uphold the integrity of elections was questioned. Democratic Senator Al Franken said, “How did Facebook, which prides itself on being able to process billions of data points and instantly transform them into personal connections for its users, somehow not make the connection that electoral ads paid for in rubles were coming from Russia? Those are two data points! American political ads and Russian money: rubles. How could you not connect those two dots?”
Facebook’s reaction to the criticism
Facebook’s Mark Zuckerberg also condemned Russia’s attempts to influence the election and discussed the steps Facebook will take to combat and prevent such acts in the future. Facebook is currently working with the US government on its ongoing investigations into Russian interference. In the coming months, it is promising to make political advertising more transparent and strengthen its ad review process for political ads. Investment in security; specifically election security, and the sharing of threat information with other tech and security companies, will rise. Along with this, it will also expand partnerships with election commissions all across the world. Moreover, Mark Zuckerberg has pledged to ramp up spending that will enable the employment of an additional 10,000 people to review content on the platform.
Continued success for Facebook
Despite the hot water that Facebook landed itself in, its quarterly profit ascended 79 percent and revenues were up by 47.3 percent to 10.33 billion for the quarter ended September 30. The share price was a staggering $182.90 on November 1, that initially rose in after-hours trading but later fell into negative territory after additional spending to curb future political warfare was disclosed. Facebook has a regular user base of more than 2 billion, with both its messaging services – Messenger and WhatsApp – attracting more than one billion users each.
Facebook has been warning for more than a year about reaching a limit in the number of ads the company can feature in users’ pages. However, the advertisers seem unfazed by the same. The average price per ad rose by 35 percent in the third quarter. Despite this hike, Facebook’s ad revenue increased by 49 percent to $10.14 billion. Revenue from mobile ads continued to dominate advertising revenue, constituting about 88 percent. The company gave advertisers the ability to run ads in standalone videos for the first time in the third quarter, which has already produced good results. Ivan Feinseth, an analyst of Tigress Financial Partners said, “The nearly 50 percent jump in ad revenue is phenomenal, especially when for the past few quarters they’ve been trying to bring that expectation way, way down. Yet it keeps going up.”
Despite the prevailing circumstances, Facebook’s performance was relatively strong as compared to Snapchat and Twitter. Its stocks are second after Netflix in performance; thereby reflecting growing confidence and power with advertisers.
Featured Image Source: VisualHunt
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