Latest Business News
Facebook Users Have Less Than One Month Left to Apply for Share of $725 Million Settlement
The Background
Facebook users have less than one month left to apply for their share of a $725 million settlement over the social network's privacy violations, which were revealed during the Cambridge Analytica scandal in 2018. The settlement, signed in December 2022, was the largest class action settlement of its kind. It ended years of litigation over Facebook's role in improper data sharing with a data consultancy firm used by Donald Trump's 2016 presidential campaign.
The Cost
In addition to the $725 million settlement, Meta (formerly Facebook) paid a record $5 billion settlement to the Federal Trade Commission and an additional $100 million to the Securities and Exchange Commission. Altogether, the Cambridge Analytica scandal cost the parent company nearly $5.9 billion.
The Company Today
Since the scandal, Facebook rebranded itself as Meta in 2021 and settled the class action suit in 2022. Meta has undergone significant changes and expansion, venturing into the metaverse with new hardware products, such as the upcoming Quest 3. The company has also introduced new features like the Llama 2 large language AI model, Reels to compete with TikTok, and Threads, which aims to take on Twitter.
Apologies and Claims
Facebook founder Mark Zuckerberg was forced to testify before Congress and issue public apologies for the company's missteps in handling user privacy. The $725 million settlement should not be seen as an admission of wrongdoing. However, Facebook users who were active on the platform between May 2007 and December 2022 are eligible to make a claim. The deadline for submitting a claim is August 25th, with individual settlement payments to be determined based on the number of claims submitted and the length of each user's Facebook account. Users can make a claim by visiting the official website and providing their name, address, email address, and confirming their residency in the United States during the specified dates.
Conclusion: Impact on New Businesses
The Facebook privacy scandal and subsequent settlement have had a profound impact on the social media giant and its users. However, it is not just Facebook/Meta that has been affected, but also new businesses entering the digital landscape. Here's a hot take on how this topic may impact new businesses going forward:
The Landscape of User Trust
The Cambridge Analytica scandal exposed the vulnerability of user data on social media platforms, causing widespread concern over privacy and data protection. As a result, users have become more cautious and skeptical about sharing their personal information online. This increased awareness of privacy issues has created a challenging environment for new businesses trying to build an online presence.
Burden of Building Trust
For new businesses, building trust with potential customers is essential. However, the fallout from the Facebook scandal has made users more hesitant to trust unfamiliar brands and platforms. New businesses now face the burden of proving their commitment to user privacy and data protection, which may require transparent policies, secure data practices, and effective communication to gain the trust of their target audience.
Opportunity for Differentiation
On the flip side, the Facebook scandal has created an opportunity for new businesses to differentiate themselves through a strong emphasis on privacy and data security. By prioritizing user privacy from the outset, new companies can position themselves as alternatives to established social media platforms that may have compromised user trust. This commitment to privacy can be a powerful selling point and attract users who are seeking a more secure online experience.
Evolution of Regulatory Landscape
The fallout from the Facebook privacy scandal has also spurred regulatory action and increased scrutiny of data practices. As new privacy regulations and policies continue to emerge, new businesses will need to stay informed and compliant with evolving requirements. Adapting to these changing regulations will be crucial for maintaining trust and avoiding potential legal issues in the future.
In conclusion, the Facebook privacy scandal has left a lasting impact on the digital landscape, affecting both established platforms and new businesses. While it has raised important concerns about user privacy, it has also created opportunities for new businesses to differentiate themselves and build trust through transparent data practices. By prioritizing user privacy and staying informed about evolving regulations, new businesses can navigate the changing landscape and forge authentic connections with their target audience.
Article First Published at: https://www.cnbc.com/2023/07/28/how-to-get-your-payment-from-facebooks-725-million-settlement.html.svg)
