Today Facebook released its quarterly earnings statement. Unusually, it contains a reference to the impending multi-billion dollar fine by the FTC.
As reported in the statement, the tech company has seen a continuous monthly and daily active user increase, as well as a 26% increase in year-over-year sales corresponding to $15.1 billion, ahead of expectations – meaning that the social network is doing pretty well, regardless of all the turmoil.
However, the report also contained a side reference to the FTC inquiries into Facebook’s privacy abuse.
Ashkan Soltani, an ex-worker of the FTC, pre-announcing the fine could be a negotiation strategy, aimed at anchoring the price at a level that would be acceptable for the company while discouraging any further question.Although $3 billion is a considerable amount of money, it pales in comparison to other fines issued by the FTC – for example, the $22.5 million fine to Google in 2012. It is just a fraction of the fines issued by the European Union: $15.3 and $5 billion respectively to Apple and Google.
It’s also a fraction of the fines issued to banks, such as the $16.7 billion to Bank of America for the frauds during the financial crisis.
The fine seems rather low also in relation to Facebook’s profits. Sen. Richard Blumenthal tweeted:
“Facebook made $15B in the last three months – $3B for violating an FTC order & a decade of privacy violations would be a mere slap on the wrist. FTC must pursue strong structural remedies & impose managerial accountability. Facebook won’t listen otherwise.”
The fine seems rather low to whoever is puzzled by the question – how much did Facebook really gain from the data leaks, in terms of profit, power, and influence?
Hard to tell. However, if Facebook speaks about paying $3 billion, it’s probably because they owe more.
