Facebook shares surge as US senators question Zuckerberg over data breach
Chief executive of social media giant denies Facebook ‘wilfully blind’ to abuse Zuckerberg before US senate committees in the Cambridge Analytica controversy
Facebook shares made their biggest one-day gain in almost two years as chief executive Mark Zuckerberg appeared before two US senate committees in the wake of the Cambridge Analytica data breach that has sparked calls for new regulation of the social media giant.
Shares in other media tech companies, including Twitter and Alphabet, also rose strongly as the Facebook founder faced a congressional inquisition for the first time.
Facebook traded more than 5 per cent higher at one point shortly after Mr Zuckerberg took his seat at a table before the massed ranks of 44 senators in a rare joint hearing before the committees on justice and commerce. They pulled back a little to close 4.52 per cent up on a remarkable day.
Inside the senate committee room the Facebook co-founder, chairman and chief executive was fielding the concerns of senators over a range of issues from Facebook’s handling of alleged Russian attempts at election interference to consumer privacy and hate speech.
In one telling exchange, Mr Zuckerberg was asked by Senator Dick Durbin whether he would be comfortable “sharing with us the name of the hotel you stayed in last night?” After a pause, and some laughter from himself and the room, Mr Zuckerberg said: “No.”
“If you messaged anyone this week, would you share with us the names of the people you have messaged?” Senator Durbin responded.
“Senator, no, I would probably not choose to do that publicly here,” Mr Zuckerberg said.
Senator Durbin said: “I think that may be what this is all about: your right to privacy, the limits of your right to privacy, and how much you give away, in modern America, in the name of connecting people around the world.”
Mr Zuckerberg said the company was attempting to change in light of recent criticism, as he attempted to forestall any strict legislation aimed at the world’s largest social network. “We are going through a broad philosophical shift at the company,” he said. But he said he didn’t agree with Senator Richard Blumenthal that Facebook was “wilfully blind” to abuse.
On the subject of fake news, Mr Zuckerberg said “one of my greatest regrets in running the company” was its slowness at uncovering and acting against disinformation campaigns by Russian trolls during the US election. He said the Russian campaign of disinformation had been discovered “right around the time” of the US presidential election, and said the company had developed “new AI tools” to identify fake accounts responsible.
He also admitted Facebook did not notify the US Federal Trade Commission in 2015 when it learned of Cambridge Analytica data harvesting. Asked why the company did not ban Cambridge Analytica at that time, he said the company was not doing business with Facebook in 2015.
Outside the Capitol building, which houses Congress, online protest group Avaaz set up 100 life-sized cutouts of Mr Zuckerberg wearing T-shirts with the words “Fix Facebook” on them.
Mr Zuckerberg, who founded Facebook in 2004, is fighting to demonstrate to critics he is the right person to go on leading what has grown into one of the world’s largest companies. Facebook faces a growing crisis of confidence among users, advertisers, employees and investors after acknowledging up to 87 million people had their personal information harvested from the site by Cambridge Analytica, a political consultancy that has counted US president Donald Trump’s election campaign among its clients.
Zuckerberg dresses up and sticks to script,
As the heat increased and prepared answers were less easily matched to senatorial queries, Zuckerberg at times was obviously uncomfortable if more spontaneous
Wearing a suit and Facebook-blue tie rather than his usual jeans, hoodie and trainers, Facebook chief executive and chairman Mark Zuckerberg wisely decided to dress like an adult for his grilling before Congress on Tuesday in Washington DC.
That approach had the benefit of making the young billionaire appear more his own age – early 30s – much better than looking like a jejune recent college grad.
But the well-pressed suit seemed to draw forth an equally stiff delivery, like a student awkwardly delivering over-rehearsed lines in the class play.
Zuckerberg had clearly memorised the majority of his opening statement, which stuck nearly word-for-word to the introduction and conclusion of his formal written statement, which he barely glanced at.
Surely, too, he’d practised various set responses and smooth, soothing phrases for a range of expected questions.
But as the heat increased and prepared answers were less easily matched to senatorial queries, Zuckerberg at times was obviously uncomfortable, if more spontaneous.
Senators initially began with rambling questions that verged more on statements and allowed Zuckerberg to be equally discursive, with some senators missing the opportunity to probe further into his replies.
Zuckerberg was also, unsurprisingly, dissembling from the start.
Setting the audience
Quizzed by Senate judiciary committee chair Chuck Grassley about how clearly Facebook users understood who could access the information they share, he diverted into a discussion about how Facebook gives everyone the ability to control this by setting the audience for each post.
But of course, the audience setting is not the same as who – other developers, other companies, Facebook itself – accesses such content now and in the past, and how personal content is parsed, analysed and used.
Or, as senator Bill Nelson noted, “You consider my personally identifiable data the company’s data, not my data.”
Senator Maria Cantwell introduced a new direction of short, pointed, loaded questions, delivered with an icy, no-nonsense expression. Was he familiar with Palantir, the secretive data analysis company of Facebook board member Peter Thiel? Did Palantir teach Cambridge Analytica its tactics?
And it didn’t get any better, especially from Democrats, but Republicans were notably tough, too – a sign that Congress may well, at last, introduce regulatory oversight for such big data-eating companies.
That will worry not just Facebook – even if Zuckerberg said there were some privacy and regulatory approaches he’d welcome – but all of Silicon Valley.
Because all of the tech industry will be on seat’s edge during the hearings Tuesday and Wednesday. This in great part is what this particular hearing is all about – not just taking a bead on Facebook, but firing a shot by Congress across Silicon Valley’s bow.
The Valley knows well Zuckerberg’s performance is going to influence what happens next. And going on some of his replies so far, they won’t be clicking “like”.