Facebook's settlement over Cambridge Analytica has finally been approved


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Facebook's settlement with the FTC over the Cambridge Analytica scandal of 2018 has been approved by a federal court. Last July, Facebook agreed to fork over $5 billion after it was discovered that the developer of an innocuous-looking quiz app was selling user data to the political consulting firm that briefly worked for Trump's presidential campaign.

Persona non grata — Besides paying $5 billion, Facebook has also experienced significant reputational damage as a consequence of the event. It's easy to forget nowadays, but the company and its CEO Mark Zuckerberg used to be feted upon as a great American business story. You watched The Social Network and got inspired. Not so much anymore. Cambridge Analytica drew intense scrutiny to all the dubious tactics Facebook has used to become a global behemoth — everything from improperly recycling user phone numbers for ad-targeting, to making photo tagging easy with face recognition so users will tag their friends and get them opening the app.

It's not necessarily that Facebook knew what Cambridge Analytica was doing with the data, but rather that Facebook as a company has traditionally worried about growth first and the consequences later. Anything that makes it easier for users to join and advertisers to target them. You see this in how false COVID-19 information gets published in ads on Facebook; it's because it relies heavily on cheap automation.

And while $5 billion isn't much considering Facebook did $70 billion in revenue last year, the company's expenses are growing as a consequence of the fallout. Facebook reported slowing profit growth in the last quarter as it has now hired more than 1,000 engineers just to prevent future Cambridge Analyticas. Facebook has begun regularly suing developers who it finds are collecting data improperly.

In its settlement with the FTC, Facebook also agreed to some strict new privacy measures. There's an independent committee that now reviews all of Facebook's product changes for privacy issues, and Zuckerberg himself has to sign off on quarterly reports the company must submit to the FTC. He can be held personally liable for any false statements or misrepresentations.

Facebook got away with murder — Facebook is effectively being ordered to consider privacy at every stage of its product development process. But you can't take back what's already happened. Trump deftly used Facebook to fear monger and prey on a middle-aged demographic that came out for him in droves. Facebook knowingly or unknowingly assisted in those efforts because the company's DNA has always sidelined concern for its users' well-being in favor of growth-at-all-cost.

In the grand scheme of things, Facebook became a half-trillion dollar company by playing fast and loose with users and paid pocket change to get away with it. It's starting to become more careful as regulators around the world wise up, but governments were so slow to act that all the shady moves it made guaranteed it will probably be here for the long run. These penalties were speeding tickets, and Facebook is bigger than ever.