It's hard to find anything negative about Facebook (FB). Pro Facebook fanatics say that's a good thing. With a market cap of 330 Billion it's hard to argue, that investors love Facebook . But what does Facebook do? In this article we'll prove that:
- Facebook is a disaster waiting to happen
- The only thing supporting Facebook is the intelligence community
- Facebook will always exist as a platform, but the business model will crumble like the house of cards it is
- The huge amount of Face-spam, hackers, fake-profiles, advertiser profiles, and other dishonest users will ultimately be revealed at some point
- Facebook advertising doesn't work
In 2013, Dataminr was used by the Presidential Inauguration Committee to track potential threatsto President Barack Obama's second term inauguration ceremony.
As for why Twitter has blocked intelligence agencies from now accessing the tool, the WSJreports: The intelligence community's obsession with monitoring social media is hardly new. Recently, the CIA's venture capital firm, In-Q-Tel, invested in dozens of tech firms creating tools for investigating social media data, of which Dataminr was reportedly a recipient, affording the agency access to the tool.
White Twitter (TWTR) is not Facebook , it can be a sign of things to come. Although it won't be likely that Facebook will block access completely, it is an issue that looms in the background ever since the revelations of the PRISM program.
Facebook workers routinely suppressed news stories of interest to conservative readers from the social network's influential "trending" news section, according to a former journalist who worked on the project. This individual says that workers prevented stories about the right-wing CPAC gathering, Mitt Romney, Rand Paul, and other conservative topics from appearing in the highly-influential section, even though they were organically trending among the site's users.
While this doesn't surprise many, this release makes it a fact. We know that Facebook is manipulating such 'activity.' The fact that Facebook is changing the public discussion by suggesting topics, based on their bias - well that's another discussion. The point here is that Facebook is a proven manipulator of its system. Facebook is a private system, the algorithms and methods are not public. It's not like the stock market. It's a system that works like - well we just have to trust them, that it works how they say it works. We have to trust their numbers, their data, and so on.
If you're using a fake name on your Facebook account, maintaining a personal profile for your beloved pet or have a second profile you use just for logging in to other sites, you have one of the 83.09 million fake accounts Facebook wants to disable.
In an updated regulatory filing released Wednesday, the social media company said that 8.7 percent of its 955 million monthly active users worldwide are actually duplicate or false accounts.
Let's just use percentages, as the number of Facebook users change rapidly. 8.7% is low. Some claim the number can be much higher, even as high as 60% - 70%. Because there's many kinds of fake profiles, not only people registering their pets. Also, there are robots, or software programs that automatically register and use Facebook accounts, often for a fee. Then there are click farms, or companies that will for a fee, create likes, views, and other forms of activity on your pages. Are you sad that you don't have any friends? Buy them on Facebook for only a few cents each! An interview with a successful click farm says that they sell 1,000 likes for only $29.99 US Dollars:
Most of the accounts Casipong creates are sold to these digital middlemen - "click farms" as they have come to be known. Just as fast as Silicon Valley conjures something valuable from digital ephemera, click farms seek ways to create counterfeits. Just Google "buy Facebook likes" and you'll see how easy it is to purchase black-market influence on the internet: 1,000 Facebook likes for $29.99; 1,000 Twitter followers for $12; or any other type of fake social media credential, from YouTube views to Pinterest followers to SoundCloud plays. Social media is now the engine of the internet, and that engine is running on some pretty suspect fuel.
We could write a series of articles on Facebook exploits, but the problem isn't the security of Facebook it is Facebook itself. For example, advertisers and marketers, are 'real' profiles, but they use Facebook to spam other users walls, and basically try to advertise their product for free.
Facebook Advertising doesn't work. That's not only industry knowledge, that's according to many analyst reports, such as this one:
"Facebook hasn't delivered on its promise and in fact has quietly become reliant on the traditional advertising models it once lampooned," he said in a report released on Monday.
That's from 2013. Since then, Facebook stock has gone up by more than double:
It seems unstoppable. At the Facebook IPO, it seemed that the stock was doomed. But it's overcome all the bugs, glitches, problems, and the reality check that Facebook doesn't do anything, except allow intelligence services to collect data about US Citizens. Well, that is valuable - but it's not a business.
If Facebook wants to maintain its supremacy, it will need to reinvent itself such as Apple (AAPL) did once upon a time. There's no comparison to Alphabet Inc (GOOG) which is into so many different businesses it's even hard to keep track.
It's not that Facebook advertisers aren't aware of this - they are. Just Google terms such as "Facebook Fraud" or "Facebook advertising fake clicks" or "Fake Facebook Likes" and you'll see hundreds upon hundreds of first hand accounts of being scammed, ripped off, defrauded, and even hacked. You'll find reports from Ad agencies about fake likes, and how it can negatively impact your brand. Also you'll find in-depth articles that research fake click like trends, such as this one on Business Insider:
The twist here is that these advertisers have not paid for fake likes. They paid Facebook for legit ads. And the fake likes themselves don't benefit anybody. Rather, they have been created en masse by click farms attempting to make their abusive accounts look real by clicking on legit ads. When a company advertises, asking for likes, the spammers respond and click on them to help their own appearance of legitimacy. For these marketers advertising on Facebook is worse than useless - it renders their pages pointless.Facebook has struggled for years to rid itself of click farms and fake like creators. These are companies, often based in the developing world, who sell unwitting marketers thousands of new likes for tiny sums of money. They generate likes by paying workers $1 for every thousand likes they create.
The point is that this isn't priced into their stock. Investors who buy the stock, don't get it. Advertisers, Facebook users, mostly understand that Facebook is itself a spamming platform. There are even books for sale about how to spam on Facebook . It's even possible to calculate the black market Facebook spam industry, about $200 Million:
Spammers posting links on Facebook fan pages to send people to third-party scam sites are earning $200m every year, according to calculations by a team of Italian security researchers who have investigated hundreds of thousands of posts on the social network.... "The spam posters get paid an average of $13 per post, for pages that have around 30,000 fans, up to an average of $58 to post on pages with more than 100,000 fans," De Micheli told the Guardian. "If we consider these two as extremes, the pages we analyzed generate a revenue of 18,000 posts per day, times the revenue per post - ranging from $13 to $58 - 365 days a year."
Facebook platform manipulation, spamming techniques, and advanced automated (robot) usage of Facebook have even given rise to a new industry, similar to what SEO (Search Engine Optimization) was in 2003 - 2006. Many companies have developed software to manage Facebook, or even made entire products and services just to manage it. Other companies stand against the use of the platform, stating that the negatives outweigh the positives. White hat and black hat agencies alike develop methods to exploit Facebook sometimes using the Facebook ads system and sometimes not.
In accounting, when something is difficult to quantify it's referred to as 'goodwill.' Goodwill, as many readers know, has no value. Yet, there are cases where Goodwill is used. In the case of Facebook , there is real revenue, 17.9 Billion in 2015. It is a huge number. Since 2013, Facebook stock has been on a bull rampage. The point of these observations in this article, is that it is built on a house of cards. There's no foundation. At some point, an event will happen, which can cause it to collapse. Advertisers will flee, users will flee. Facebook users will be comprised of spammers themselves, moping in their depression with each other, sharing stories about 'the good times' when click farms, like farms, and bot services were at their peak. Advertisers, will see diminishing returns on their investment. Facebook they will realize, is no better than the traditional advertising it was meant to replace. With the exception of big corporates such as Coca Cola (KO), McDonalds (MCD), Ford (F), and others, advertisers will find better more innovative ways to use their online ad dollars. Users will tire of ads, and find other ways to use the internet.
Let's look at the risks of Facebook practically. Users upload massive amounts of personal data to the network, usually with total disregard to any privacy concerns. Images, location data, credit cards, chat records, purchasing habits, interests, keyword searches, relationship data, and more - provide a complete profile of users. What if Facebook was completely hacked? It's not so far fetched, says Reza Moaiandin:
Facebook users could be in danger of having their personal details harvested by hackers using a loophole in the social network's privacy system. A security researcher hasdiscovered the issuewhere using only a mobile phone number, a hacker could recover names, telephone numbers, images and location data in bulk from the social network. An algorithm was used to run a Facebook API that, according to Reza Moaiandin, technical director at technology firm Salt, could harvest "millions of users' personal data".
That's not all. Phishing style attacks are also common on Facebook such as the common 'who knows you best' trick:
Facebook is the new frontier for fraud, says Tom Clare, head of product marketing at Blue Coat, an Internet security company that does annual reports on web threats. In just this past year social networks have soared to 4th from 17th most treacherous web terrain -- behind porn and software-sharing sites, which you probably know to avoid. What makes Facebook so treacherous? Us.
1. Who knows you best?
The message reads: Can you do this? My middle name __________, my age ___, my favorite soda _______, my birthday ___/___/___, whose the love of my life ______ , my best friend _____, my favorite color ______, my eye color _______, my hair color ______ my favorite food ________ and my mom's name __________. Put this as your status and see who knows you best. â™¥
How many of these are the same facts your bank asks to verify your identity? Put this as your status and everybody -- including all the people who want to hijack your bank account and credit cards -- will know you well enough to make a viable attempt.
Facebook was designed with collecting data on users in mind. In order to do this, it wasn't built like Fort Knox. In fact, to the contrary, it was left 'open' because many rules, procedures, and protocols may have discouraged the use of Facebook . In plain language, Facebook secretly attracts spammers, while publicly fighting them. It's because Facebook is a spam platform, built by advertisers, for advertisers. The more users, real, fake, or spam - the more Facebook could charge for advertising, the more Facebook seemed like a 'real' company.
There's one thing in the online marketing business that any SEO will tell you - if you are advertising your Facebook page, you aren't advertising your brand, you are advertising Facebook itself. So Facebook encourages spam, and aggressive marketing practices, because it's really promoting Facebook itself. "As seen on Facebook" was akin to "As seen on TV." Facebook likes spam-bots because frankly, it does their job for them. It inflates their numbers. On a platform which was trying to prove itself, it wanted exponential growth of users. Facebook wanted to look bigger than it was.Recently a group in the UK tried gaming the system without using any spam-bot, and notified Facebook (FB) of the flaw, Facebook (FB) did nothing:
A research team from McGill University's computer science school has published a paper that demonstrates a way of creating fake "Likes" on Facebook without using a botnet or an army of spammers. The team says, in a paper published on March 19 this year, that Facebook was alerted to the flaws two years ago but loopholes on the site still remain. The McGill team is hoping that by making the bugs public, advertisers - who rely on Likes and pay for them - and users will realise that some articles aren't actually as popular as the number of Likes would indicate.
Why Facebook does nothing when notified about such a flaw? Because they 'like' such flaws - Facebook itself is a flaw. It wouldn't be surprising that in the early days, friends of Facebook were hired to create bots that could automatically create millions of profiles, activity, and so on. Like the battle SEOs have with Google - Google uses sophisticated algorithms (bots) to manage data, but if a webmaster is found using a bot, Google punishes them with a 'penalty.'
Facebook has two faces. The reason Facebook only has a 'like' button and not a 'dislike' button is to hide the second darker side of Facebook , that investors and users may not like.
Of course, there's nothing wrong with Facebook existing, but not at a market cap of 300B. Buy Amazon (AMZN), Google ,(IBM) buy anything - just sell your Facebook stock before the big reality check, that it's just a Fakebook.
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