Despite the Cambridge Analytica Scandal Facebook is Rising in Profits
Despite the data scandal, Facebook is doing well. After some very intense weeks, the company brings out the figures for the first quarter on Wednesday evening. They are better than expected.
Turnover developed by 50 percent compared to the first quarter of 2017. In the first three months of 2018 sales were almost 12 billion, in 2017 it was 8 billion dollars.
The past few weeks were dominated by concerns about privacy after the data scandal surrounding Cambridge Analytica. That company played a bad part in President Donald Trump’s election campaign. The fact that the private data of 87 million people were shared with Cambridge Analytica caused a lot of unrest about Facebook.
#DeleteFacebook went Viral
Despite #DeleteFacebook, the call that went on social media to remove profiles, the platform got 49 million users. This ensures that 1.45 billion people are on Facebook every day. Zuckerberg himself said that ‘no significant number’ had left the platform.
In North America, Facebook has received one million additional users. That is striking because at the end of 2017 it appeared that the region was saturated; for the first time, the number of users dropped.
Late in the Quarter
At first, a glance, so no panic: even though there was a lot of commotion surrounding Facebook’s data scandal, there were hearings in the Senate and people were angry about the use of data by Cambridge Analytica, financially it does not affect Facebook at the moment.
Those last three words are necessary. The scandal with Cambridge Analytica did not arrive until the end of March, in the previous two weeks of the first quarter.
If that would have consequences after the end of March – such as a reduced number of users or expiring advertisers – those consequences would only become visible when the results for the second quarter became known, at the end of July. The same applies to any costs that Facebook makes for measures relating to the privacy of users.
Privacy is No Enemy of Advertisements
“We have always paid attention to privacy, we have never sold your information to anyone,” said a Facebook spokesman in a webcast. “You can always see why you see an ad.” Advertising and protecting privacy are no match for each other. “
“We are proud of our advertising model. But we also know that people have more control over how their data is used, “says the spokesperson. “In the coming month GDPR (AVG, the European Privacy Act, ed.) Gives us an opportunity to make people better understand how we do that.”
Moving to Privacy Law
It is striking that Facebook announced last week that the data of 1.5 billion non-European users would be moved from Ireland to America. The company ensures that European privacy legislation does not cover these users.
Facebook itself states that it does not matter and that they offer privacy to all users. But in practice, it ensures that the users who have been traversed can not also start a privacy case from the AVG. The legislation ensures that companies that violate the law can get fines of up to 4 percent of their worldwide turnover.
The figures also reveal that in the first quarter Facebook can count a net profit of almost 5 billion dollars. In the first quarter of 2017, this amounted to just over 3 billion dollars.