Facebook is Under Fire but Billionaire Founder Zuckerberg’s Wealth Jumps $3 Billion
It seems investors and Facebook users still won’t be phased by increasing pressure on the social media giant and its CEO Mark Zuckerberg. Despite data privacy concerns, tax hits, and scrutiny from global governments Facebook’s share price has risen and with it Zuckerberg’s wealth. The CEO is the 7th richest man in the world.
Zuckerberg’s Wealth Rises, He’s Now Worth $63 Billion
Reporting by Forbes puts Zuckerberg’s new gains at $2.8 billion this week. This takes his net worth to $63 billion and further cements his position amongst the world’s richest.
The CEO under fire owns around 15% of Facebook’s stock. That stock has risen in value by roughly 25% since 2019. Facebook’s share price has recouped December losses and sent the stock heading back towards peak levels of 2018.
There are less than a handful of positive news stories this year for Facebook. Yet the stock shot upwards by more than 10% after it released its fourth-quarter 2018 earnings.
An announcement from Zuckerberg this week revealed a pivotal shift as the CEO suggests a move from the current open “town square” social sharing ethos to a more private “digital equivalent of the living room.”
Facebook has taken hit after hit. Mostly over the way it uses and shares an individual’s data and allows targeted advertising on the platform. Now Zuckerberg has a new “vision” saying:
As I think about the future of the internet, I believe a privacy-focused communications platform will become even more important than today’s open platforms.
The CEO plans to integrate the messaging services of WhatsApp, Messenger, and Instagram. Building a platform focused on user privacy and encryption. And, with the automatic deletion of messages after a period of time.
Privacy gives people the freedom to be themselves and connect more naturally, which is why we build social networks.
Zuckerberg is late to the privacy table but follows Apple’s Tim Cook who has increasingly pushed the iPhone-makers more data protecting ethos. Cook warned of falling iPhone sales earlier this year, panicking investors, even as his own earnings rose.
This new vision for the social media mammoth may have pushed Facebook’s share price up nearly 5%.
Skeptics aren’t buying into the new approach. Ashkan Soltani is former chief technologist for the US Federal Trade Commission and former Whitehouse advisor. He calls a “strategic play” to use privacy as a “competitive advantage” adding:
While positioned as a privacy-friendly play, its timing suggests a competition play to head off any potential regulatory efforts to limit data sharing across services.
I strongly support consumer privacy when communicating online but this move is entirely a strategic play to use privacy as a competitive advantage & further lock-in Facebook as the dominant messaging platform.
— ashkan soltani (@ashk4n) March 6, 2019
It seems Facebook shareholders are satisfied with Zuckerberg’s plans as the stock continues to hike. Zuckerberg’s wealth looks secure. New research from Edison suggests a small decline of 15 million US users over the past two years. Just a fraction of Facebook’s estimated 172 million US users and billions of users worldwide.
A content strategist for Drum Agency, Ben Heiser, says that:
If you look at the actual numbers, not survey results, Facebook reported that there were 1.52 billion daily active users in Q4, an increase of nine-percent year-over-year.
Another digital marketing agency CEO, Steve Weiss, confirms that Facebook advertisers aren’t phased by the usage drop either:
With Facebook’s continued investment in analytics across all its platforms, we also expect to see advanced engagement metrics for Stories, which will ultimately boost bottom-line revenue for Facebook
Hit After Hit but Facebook’s Still Up
Most recently France has hit Facebook and other technology giants with a 3% digital services tax. 2020 presidential candidate Elizabeth Warren says its time to break up Facebook as well as Amazon and Google.
Almost unbelievably Facebook users appear to have been exploited yet again with a two-factor security authorization process that exposes user’s mobile numbers.
Our final @CommonsCMS report on disinformation and fake news has now been published and can be found here on the committee website. We make a large number of recommendations including statutory regulation for social media to protect users from online harms https://t.co/9qlRsY9G03
— Damian Collins (@DamianCollins) February 18, 2019
And if a new damning report from the UK which describes Facebook and Zuckerberg as “digital gangsters” wasn’t enough Facebook’s 2018 was full of the Cambridge Analytica scandal. It goes on, but realistically very few users are willing to quit Facebook so Facebook’s share price and Zuckerberg’s wealth continues to rise this year.