Can Facebook make privacy profitable?

Facebook CEO Mark Zuckerberg. Photo / AP

Mark Zuckerberg insisted this week that he's serious about privacy - so much so that he's planning to transform Facebook into a more refined social experience. But the social network's chief executive has made similar commitments in the past, with mixed results.

In spring 2018, at the height of the Cambridge Analytica scandal, he said that users would soon have a feature called "Clear History" to erase the trail of apps and websites they frequented off the platform. But this modest tool, far less ambitious than his vision for a reoriented Facebook, has yet to materialise.

Privacy experts were quick to note the timing of Zuckerberg's memo, which arrived as regulators around the globe are circling. They also questioned how Facebook's business model - harvesting people's information to show them ads - would adapt when private communication takes center stage.

As Zuckerberg himself acknowledged, the idea the company will reorient itself around privacy will strike many users as improbable or paradoxical. "I understand that many people don't think Facebook can or would even want to build this kind of privacy-focused platform - because frankly we don't currently have a strong reputation for building privacy protective services, and we've historically focused on tools for more open sharing," he wrote.

For one, people writing about their lives fuels the endless scroll of news feed, the core of the social network. The widespread sharing of intimate details was encouraged and normalised by Facebook, and even gave rise to "Zuckerberg's Law" - the CEO's theory that people would share more about themselves every year - in 2008.

Facebook's avowed turn toward privacy also is striking because of the company's litany of privacy scandals. What Zuckerberg describes as a lack of "a strong reputation for building privacy protective services," critics view as a lengthy record of mishaps, apologies and sustained disregard for people's privacy.

Observers contend the company has yet to deliver on much more rudimentary privacy controls, casting doubt on its pronouncement of change.

Others question how Facebook will make money once it shifts away from widespread data collection and public posting - the foundation of its advertising empire. The company took in more than US$55 billion ($81.3b) in 2018, nearly all of it from advertising.

Zuckerberg acknowledged that some people worry Facebook will access encrypted messages between users. The type of encryption being developed for its apps allows only the message sender and recipient to read them - not even Facebook can access the content. But the company will have other ways to squeeze revenue from its users and track their interests and behaviours.

Once Facebook makes messaging across its apps more secure, it plans to "build more ways for people to interact on top of that, including calls, video chats, groups, stories, businesses, payments, commerce and, ultimately, a platform for many other kinds of private services," Zuckerberg wrote.

Ashkan Soltani, a former Federal Trade Commission official and privacy researcher, framed Zuckerberg's vision as a play to mimic the success of WeChat. The Chinese company's app combines a dizzying array of activity, as if Facebook, Uber, PayPal and many other services were combined to form a super app, replacing the Web browser as the dominant conduit connecting a person to the Internet.

Though the content of messages between individuals would be concealed from Facebook, correspondence between users and businesses and between users and Facebook would still be recorded through the platform, Soltani said.

What's more, he added, Facebook could sell access to users on the private messaging platform, in a similar way the company sells access to users' attention on the Facebook news feed. "They're in the business of selling attention, this is another way to capture it," he said.

Facebook has already introduced advertising on its Messenger app, and businesses can pay the social network to engage customers on WhatsApp. Because the underlying encryption technology Facebook uses across apps is the same, it should not be fundamentally difficult to allow users to chat securely across the site's services, Soltani said.

But this seamless, encrypted communications network may pose new challenges to consumer advocates, regulators and law enforcement. Malicious businesses selling predatory loans or dubious nutritional supplements could be shielded from scrutiny as they market to customers and chat with them in secret.

And Facebook won't be able to police deceptive or abusive political advertising and misinformation.

Binding Facebook closer to Instagram, WhatsApp and Messenger may invite antitrust concerns, since the move could be seen as a maneuver to preempt calls to break the company up or silo its businesses.

Facebook's remarkable turn toward privacy comes as young people are drifting from the platform.

According to a recent Pew Research Center survey, more 13- to 17-year-olds say they use YouTube (87 per cent), Instagram (72 per cent) and Snapchat (69 per cent), than Facebook (51 per cent).

Both Instragram and Snapchat feature "stories" - collections of pictures and videos that automatically expire after a day. Zuckerberg said that this aspect of impermanence could be extended to all private content, which may further diminish the Facebook app's standing.

"The framing is new for Facebook, talking about everything being private, said Justin Brookman the director of consumer privacy and technology policy for Consumer Reports. "What its actually going to mean in practice . . . I have a lot of questions."