While the fact Facebook sold data without its users’ knowledge or consent is old news, new reports that federal prosecutors are conducting a criminal investigation into data deals the social media platform struck with several of the largest technology companies have heightened the stakes.
Since these thoughts are being added to a series of articles focused on relationship management, I would like to begin by offering some observations regarding the relationship between Facebook and its more than 2.25 billion users.
If a relationship had an address, it would be located on a two-way street. In all but a few rare instances, relationships include a measure of reciprocity. If you give me a cup of coffee, I owe you, depending on our relationship, friendship, a good story, a cup of coffee tomorrow or $2.50.
Anyone who chooses to believe Facebook is “free” simply because it does not charge a subscription fee is not being realistic. Facebook provides a virtual meeting place, soapbox and photo album to its users at significant cost to the company. We must assume Facebook’s more than 35,000 employees don’t work for free. Add to that the cost of real estate, utilities, server farms and, of course, insurance.
Since Facebook doesn’t charge a subscription fee, it must find other ways of paying its bills. Therefore, when I hear Facebook is selling ads to companies that track my online search behavior, I save my outrage for climate change, voter suppression and miscreants who don’t pick up after their dogs.
Facebook and I have entered into an adult relationship in which I get something from them and they get something from me. We have willingly entered into a mutually beneficial relationship.
Of course, like all relationships, Facebook and its users must be able to depend upon the other’s good sense and proper behavior. When it comes to users, Facebook outlaws certain behaviors. For example, the company’s Statement of Rights and Responsibilities prohibits “hate speech.”
Since Facebook speaks with one voice, the task of drafting a Statement of Rights and Responsibilities for users may be challenging but not inconceivable. Of course, this task would be inconceivable for Facebook’s more than 2.25 billion global users. Consequently, Facebook must deftly determine what is right and wrong for users from a wide range of geographies and cultures.
The following, as reported by The New York Times, feels wrong: “The sharing deals empowered Microsoft’s Bing search engine to map out the friends of virtually all Facebook users without their explicit consent and allowed Amazon to obtain users’ names and contact information through their friends. Apple was able to hide from Facebook users all indicators that its devices were even asking for data.”
Each time Facebook strays beyond what its users should be able to reasonably expect from their relationship, it runs the risk of a trial separation and eventually a divorce. Users will migrate to alternate social media platforms or possibly even put down their personal devices and take a walk in the park.
Like Facebook, the carrier community gathers vast amounts of information from users. Carriers know insureds’ health histories, driving records, dates of birth, geography and claims histories. Carriers know if jewelry was stolen from an insured during a move, as recently happened to my daughter. Carriers know if the moving company damaged the insured’s staircase during the move, as recently happened to me.
Carriers have a relationship with insureds. Insureds submit payment after receiving a premium notice, while carriers transfer risk and settle a claim following an unplanned event. Each party expects the other to act in good faith. When my daughter submitted a claim for lost jewelry, the carrier could reasonably expect she was telling the truth. My daughter reasonably expected the carrier to honor the claim after filing a police report.
Carriers must vigilantly guard the wealth of information provided by insureds and not treat it as a profit center. Facebook has taken undue liberties regarding its relationship with users—and it is paying the price with a diminished stock price and reputational damage. Carriers should consider Facebook’s flogging in the courts of law and public opinion to be a free education.