Data: Facebook Risks a Record Fine of $ 3 to $ 5 Billion

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"We estimate that the range of loss in this case is between $ 3 billion and $ 5 billion," writes Facebook.

The social network expects to have to pay a fine of 3 to 5 billion dollars in the United States for its misuse of personal data of its users.

Facebook expects to pay a three to five billion dollar fine in the United States because of its highly controversial management of personal data .

But despite the scandals, the social network is still garnering more turnover and users. Reassured, investors rushed on the title, which took 7.6% around 11pm Wednesday 24th April, 2019 in electronic trading after the closure of Wall Street.

The network, which still posted $ 2.43 billion in net income, recorded $ 3 billion in its accounts in anticipation of a likely fine from the Federal Trade Regulatory Agency, the FTC, a figure that could even reach $ 5 billion in the end.

The group could be punished for violating a 2011 agreement , which committed to the respect of personal data and the transparency of their use for advertising purposes. The FTC had opened investigations after the breakup in March 2018 of the data leakage scandal to Cambridge Analytica.

“We estimate that the range of loss in this file is between $ 3 billion and $ 5 billion. The file remains in progress and there is no certainty as to the date and the final terms, “said the social network.

In a conference call with analysts, his officials simply confirmed talks with the FTC. A negotiated agreement, common practice in the United States, avoids a trial, potentially very damaging to society.

Risks of repercussions

Even though the Facebook group financially showed its solidity in the first quarter, analyst Debra Aho Williamson (eMarketer) advised advertising advertisers – who provide the group with almost all of their income thanks precisely to the personal data that allow them to be targeted. pubs – to “take note” of the $ 3 billion provisioned for the FTC.

“This is important news and any deal with the FTC could have an impact on the ways in which advertisers can use the platform in the future.”

Indeed, this type of agreement usually includes commitments from the sanctioned company. In this case, Facebook could for example have to promise a more limited use of personal data .

However, the problems of Facebook will not stop after a possible agreement with the FTC: the stock policeman, the SEC, as well as the Ministry of Justice also investigate the practices of Facebook, which are also the subject of complaints from US states or shareholders, not to mention lawsuits in other countries.

Boss Mark Zuckerberg did not mention the FTC on Wednesday and essentially repeated his plans announced in March to begin a fundamental shift towards a more intimate and more privacy-conscious platform, giving pride of place to ephemeral formats (such as small “Stories”) and private couriers, as opposed to the traditional “news feed”.

This change in strategy will take “five years or more,” said the young multimillionaire.

Always more

Side finance and popularity, Facebook has once again shown in the first quarter that he was still strong.

“We have made significant investments in safety and security while continuing to grow our users and business. This quarter has once again shown that we can do both, “said number two Sheryl Sandberg.

At 15.1 billion (+ 26%), the turnover is a little above expectations. The number of active monthly users is 2.38 billion (+ 8%), as expected. The group further estimates that 2.7 billion people use Facebook , Instagram, Messenger, or WhatsApp each month.

These figures, however, confirm the slowdown in growth of the group, which will continue. For comparison, last year at the same time, turnover increased by 49% over the previous year, while the number of monthly users grew by 13%.

Facebook has still hired a lot (+ 36% to 37,773 employees), recruitments intended in particular to better control the content that circulates on the platform, the other topic that is worth to Facebook of violent critics around the world.

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