The decline of Facebook

5 October, 2021

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Practically all the US and European press broke out yesterday with Facebook on the front page. The six-hour outage of Facebook, Instagram and Whatsapp affecting thousands of companies further amplified the media and political offensive against the monopolist. Why has speculative capital’s favorite “unicorn” become a “public enemy”? What’s behind the change in discourse and pressure from governments?

Table of Contents

What’s going on with Facebook

Frances Haugen, former chief product officer of Facebook, on CBS
Frances Haugen, former chief product officer of Facebook, on CBS

On September 13, the Wall Street Journal began running a series of articles about Facebook based on revelations from a company executive who at the time remained anonymous.

The first volley revealed that Facebook executives had access to information allegedly protected by the company – from personal data to campaign profiling. The second that studies commissioned by managers had found that Instagram had a psychologically toxic effect on many teenagers. The third installment showed that changes to the algorithm had had the opposite effect to that stated: instead of further promoting users’ personal and family relationships, it ended up catapulting “objectionable content” and hate speech, in several cases on direct instructions from Mark Zuckerberg.

In part four the contents were even more outrageous: human traffickers, terrorist groups, clandestine organ theft networks… all denounced by workers to their managers, who in most cases decided to simply “let it go”. New installments on Facebook’s inability to beat the anti-vaccine crowd on his own platform and the company’s techniques for targeting teenagers, rounded out the picture.

By October 3, the whistleblower, Frances Haugen, surfaced in prime time on CBS. Yesterday she testified in the U.S. Senate in a committee that has been trying for months to corner the company and create for it a regulatory framework similar to that of big tobacco as it relates to young people and a legal fence around its proven abuses of personal data privacy.

To all this, on Monday, a supposed “configuration error” left millions of personal users, hundreds of thousands of teleworkers worldwide who use Whatsapp as a daily tool and even a few thousand company workers who use Facebook’s remote work platform “offline” for hours. Bad timing.

The immediate takeaway from the press, both in the US and in Europe, has been to portray Facebook today on its front pages as a dying lion. Wall Street reacted by devaluing the company’s shareholder value at $6 billion.

Why Facebook is so important

Mark Zuckerberg
Mark Zuckerberg

Facebook never was anything of a technological innovation, it was not even the first massive “social network”, technically it was rather shoddy, and yet it has been a “historic” company. It represents, along with Google, Amazon and twitter, the way in which capital has shaped a technology – the Web and its environment – that was initially difficult for it to capitalize and monetize.

It is true that capital has had difficulty “digesting” the Internet. Like other technologies, which have the capacity to satisfy massive needs with practically constant variable costs, its commodification requires the continuous imposition of new legal and coercive barriers, as shown by the development of intellectual property laws over the last thirty years. Laws that end up becoming state or para-state systems of surveillance and generalized repression.

But it is not only by giving one more twist to state totalitarianism that the system defends itself from the productive forces that it itself has created and which it now slows down instead of developing.

The huge masses of fictitious capital expressing the difficulties of capital for accumulation only bet on a sector or technology if they can condition its development in order to be useful to their placement. That’s what silicon valley and its thousan imitator replicas in every national capital are for.

Their first result – Google, facebook, Amazon, twitter…- are unnecessary answers from the point of view of human needs – nothing they do needed them to be able to provide themselves for free to millions – but are vital to give meaning to billions of dollars invested in “server farms”, masses of computing capacity and development.

Internet y el comunismo, 12/3/2019

Facebook was the first “unicorn” of social networks. And when its ability to raise and place capital began to wane, it bought Instagram for $1 billion and Whatsapp for 19 billion, using its own user base to pump them up so it could soak up more capital.

Thanks to that, just this year it was one of only four tech companies, along with Amazon, Apple and Google, to surpass $1 trillion in capitalization. Yesterday morning the company’s value, all things considered, was $919,700,000,000,000.

Facebook has so far been the world champion of profitable capital placement. That’s why, for years, Mark Zuckerberg has been the hero and favorite visionary – next to Steve Jobs – of the business press.

Read also Internet and Communism (in Spanish), 12/3/2019

Why did it fall from grace

Statistical and network analysis software used by Cambridge Analytica to develop its campaigns.
Statistical and network analysis software used by Cambridge Analytica to develop its campaigns.

Today we are told of Mark Zuckerberg’s supposed entrepreneurial genius as macho aggression and the “freedom” brought by Facebook and its supposed importance to movements like the “Arab Spring” has morphed into accusations that the platform is “the world’s greatest autocracy” and the operational base for “Trumpist putschism”. President Biden himself sourly accused the social network of being the origin of vaccine disinformation and even of “killing people.”

This turn of events would be incomprehensible without at least two factors:

1 Facebook’s main advantage in the advertising market is not only the size of its user base, but above all, its ability to “micro-target”, i.e. to profile very specific groups to which to send advertising and specialized information.

This advantage, conveniently used -that is, used by a company like Cambridge Analytica– can become decisive in some electoral processes, putting in jeopardy the predictability of the well-oiled opinion-creation industry on which democratic systems rest.

The Democratic opposition in the United States and United Kingdom’s “remainers” ended up blaming the “leave” victory in the Brexit referendum and Trump’s election victory on this type of microtargeting campaign, even associating it with Russian interference. It was just one more hypocritical argument in the quarrel of the moment within the Anglo-Saxon ruling classes.

But that is precisely why it was important: a platform monopolizing a technology that can be decisive in the balances of power between sectors of the ruling class cannot remain outside the control of the state, hence the constant pressures toward its regulation.

Read also: Cambridge Analytica: the scandal is democracy (in Spanish), 20/3/2018

If this applies to the US, all the more so to the European powers, which need to assert a certain autonomy in the current process towards imperialist bloc formation. It’s not just a matter of large Internet products being part of the battle to place capital, for the EU regulating large platforms is really a way to ensure a certain ideological autonomy.

The entire legal battery being developed by the EU, from the DSA to the “Cyber-resilience Act” promised by von der Leyen last month, is designed to juggle the flow of capital with the US and Britain with limiting the destabilizing capacity associated with platforms. The experience of Bannonism and the anti-vaccine movements, the Islamist boom in French neighborhoods and ongoing suspicions of Chinese and Russian interference is pervasive throughout EU legislative discourse.

2 Social networks are no longer spearheading new capital applications in technology.

Artificial Intelligence made the definitive leap to the forefront of capital’s expectations in 2018, immediately becoming an accelerant of imperialist tensions between the US, China and Europe. Its immediate linkage to the arms race, to old highly concentrated capital industries like automotive and the promise of increasing productivity in terms of profit in virtually all industrial processes, have concentrated capital’s interest in AI and left online services and social networks in the background.

Google, Amazon and Facebook have been pioneers in developing AIs. But while the first two have focused from the outset on bridging the gap to commercialization in other sectors and exploring industrial uses, Facebook has limited its AI expertise to its own needs. It is far from being indispensable to the new digitization industries in the way that Google is.

Is Facebook going to disappear?

Big speculative capital sees its future in the Green Deal and Artificial Intelligence. Those most interested in shaping the Internet ponder the possibilities of quantum computing for its privatization. And states today find themselves in a very different game from a decade ago, in which controlling the influence of large platforms like Facebook is paramount.

It’s not that Facebook, twitter or Google are completely expendable for capital and will be shut down or called into question. But they are no longer untouchable. The future of capital is not at stake in them and the crisis of the political apparatus is often played out against them.