Created in 2004 by Mark Zuckerberg, who was barely 19 years old at the time, along with two other Harvard students, the truth is that there are many fronts that the company has opened in recent times. His management of data protection, privacy, and the treatment of fake news has generated thousands of headlines. To understand the evolution, the rise and fall that many anticipate, we invite you on a journey through the history of a social network that continues to make people talk from its appearance until the recent announcement of Meta, with which its creator tries to put a new spin on the brand. Can you come with us?
The birth of a legend
On February 4, 2004, the world changed. That day Facebook is launched, a social network created by a Harvard student named Mark Zuckerberg (White Plains, USA, 1984) along with other students and roommates (Eduardo Saverin, Andrew McCollum, Dustin Moskovitz, and Chris Hughes ).
Although it would not be until 2008 that the project would be available in Spanish, the truth is that the initial purpose was to turn it into a private network for the exchange of information among Harvard students.
Due to its success, in a few months, its use was extended to other universities in the Boston area until it became popular in all American universities. In September 2006, general public access to the project was allowed until it became, today, the social network with the largest number of registered users on the planet, with more than 2,800 million monthly active users.
The numbers are also impressive if we talk about its creator, who is currently the fifth richest person in the world, with a fortune estimated at 104.8 billion dollars, according to data from Bloomberg.
How Facebook works
Using Facebook is very simple. Each person has a profile that they associate with an email account from which they can share information of different types and formats. From their account, each user can publish the content they want their community to see. To be connected, a user must send a connection request that the receiving profile must accept to share its content.
Although what you have just read is probably nothing new, it is important to lay the foundations to understand the complex structure and the infinite amount of information that today moves in this horizontal social network (which does not specialize in a specific topic), where brands continue to invest to make their products and services visible through the use of company pages.
Other options of interest to companies are the monitoring of the conversations that their potential audiences have or the use of its ad publication tool, where it is possible to create powerful campaigns based on a multitude of parameters with which to segment our different target audiences.
The rise and decline of Facebook
There are many advances, milestones, and controversies in which the most famous social network in the world has been immersed. So that you don’t miss any details and we can learn some lessons later, let’s see the key facts from its origin, in 2004, to the present. Review with us the main milestones, the biggest controversies, and the crossroads that Facebook has had to face. Ready for the trip?
From student projects to the Oscars (2004 – 2010)
As we have already seen, Facebook was born on February 4, 2004. It will be on March 1 of the same year when the original project, conceived for Harvard, will be opened to students from Stanford, Columbia, and Yale universities after the success of its first weeks.
On June 1, 2004, the company moved to Palo Alto, California. It will be in December of that same year when the social network will celebrate its first million active users. A year later, it would already be six million. In April 2006, Facebook for mobile devices is launched and in September it will begin to allow anyone to register.
Although everything seems to be going smoothly, in March 2007, two of Zuckerberg’s former Harvard classmates, Cameron and Tyler Winklevoss, sued the Facebook co-founder in federal court for idea theft. The trial concluded with a settlement of 65 million dollars. In October of the same year, Microsoft buys a 1.6% stake in Facebook for $240 million.
The famous like button landed on the social network in February 2009, a date on which Facebook becomes the first social network in the United States, above MySpace.
On October 1, 2010, The Social Network is released, the film directed by David Fincher with a script by Aaron Sorkin, based on the start of Facebook. The film, which according to Zuckerberg is far from reality, won three Oscars and four Golden Globes, including best picture.
An unforgettable IPO and a controversial study (2011 – 2015)
In November 2011, Facebook agreed to change its privacy policies and submit to audits in the United States, after the complaint filed in 2009 by various associations before the Federal Trade Commission (FTC), the EPIC (Electronic Privacy Information Center ), and the Center for Digital Democracy (CDD), where the social network was accused of violating consumer protection laws.
It is in April 2012 when Facebook acquires the social network Instagram for 1,000 million dollars and a month later the company debuted on the stock market in what until then was the largest exit in the history of an Internet company, with a valuation close to 100,000 million dollars. In October of that same year, the social network reached 1 billion monthly active users.
In June 2013, technology consultant Edward Snowden published a series of documents on PRISM, a clandestine electronic surveillance program created by the United States National Security Agency (NSA), consisting of the massive collection of communications from nine companies, among which is Facebook. Zuckerberg, for his part, denies that they have cooperated with the program.
In February 2014, Facebook bought WhatsApp, the instant messaging application, for a whopping $19 billion.
In June of the same year, a study carried out by researchers from Cornell, the University of California and Facebook came to light, with which they tried to measure the emotional response of the user, manipulating the news that reached 690,000 users. The results published in the prestigious Proceedings of the National Academy of Science show that those who have been receiving more negative or positive impacts produced more content in the same line, many users criticize their participation in the study without giving permission.
The year 2015 becomes a historic year: the company’s shares reach an all-time high, standing at a market value of close to 245,000 million. On August 24, on the other hand, 1 billion active users are achieved in a single day.
Growing up in the era of fake news: controversy is served (2016 – 2018)
In October 2016, Facebook faced a lawsuit for racism by offering the possibility of segmenting its advertising campaigns based on ‘ethnic affinity, a functionality with which it was possible to exclude ad views from different ethnic groups, something illegal in the United States, which concludes with the elimination of this possibility in housing, employment and credit advertisements.
Much is said about the influence of Facebook on the results of the presidential elections in the United States in 2016, before which Zuckerberg tries to leave the forum. That same year, as Google also does, the social network announces that it will stop allowing creators of fake news to use its ad sales services, considering them part of the “illegal, misleading or lying” category.
This is done after great controversy over false news that claimed that Barack Obama was a Muslim and even that Hillary Clinton was guilty of murder. According to BuzzFeed data, the 20 most viral false news stories from the political campaign that ended with Donald Trump’s victory generated almost nine million reactions on Facebook.
In April 2017, Facebook announced that it had reacted to more than 30,000 false accounts in France before the country’s elections were held. Also in 2017, a ‘Related Articles’ feature is launched which tries to increase news verification.
During this year, the controversy over Facebook’s involvement in Trump’s victory is still alive when it was revealed that the company sold ads to false accounts and pages worth approximately $100,000. More than 3,000 advertisements linked to Russia are quantified, among which they carry out practices such as associating refugees with rapists and promoting the fact of carrying weapons. In October, the company announces new measures, among which is the obligation for advertisements linked to elections to identify the person or organization that pays for the action.
In March 2018, an investigation by the New York Times and The Observer determined that the British consulting firm Cambridge Analytica was in charge of obtaining the personal data of 87 million users on Facebook to create advertising campaigns for political purposes and without the consent of these users. With these data, psychological profiles of voters who would have been sold to Donald Trump’s electoral campaign were generated. Shortly after, Zuckerberg publishes a timeline of the events in his personal profile in which he assumes errors and explains the next steps to guarantee the privacy of users.
Facebook shares plummet 19%, punishing its weakness in revenue generation and slowing growth in active users. This fall is also linked to the questioning of its privacy management after the scandal with Cambridge Analytica came to light.
The bad news continues in 2018 when on September 28 the company announces that it has suffered an attack that ends with the exposed information of almost 50 million users.
A multimillion-dollar fine and a pandemic that multiplies income (2019 – 2020)
In May 2019, Facebook banned the visibility of such well-known personalities as the leader of the Nation of Islam, Louis Farrakhan, removing a good number of profiles from the platform to fight against hate.
In July of the same year, Facebook accepted a fine of 5.1 billion dollars before the federal government in Washington for the Cambridge Analytica scandal. From this moment, and in the face of a major economic blow that the company expected to be 2,000 million less, it focuses its efforts on preventing the platform from being abused in the face of the 2020 US elections.
We will all remember 2020 as the year in which our lives stopped with the arrival of COVID-19, but the truth is that for Facebook it was a good year in terms of numbers, with annual revenues of 85,958 million dollars, 22% more than in the previous year. This increase responds to the growth in digital advertising investment by companies, motivated by the increase in online purchases due to the pandemic.
More than 160 US brands stood up to the social network during the same year calling for a boycott due to the company’s “repeated failure to meaningfully address the widespread proliferation of hate on its platforms. ” Among them are Unilever, Starbucks, Ben & Jerry’s, and the well-known clothing brand The North Face, whose spokespersons called for the creation of stricter policies to “prevent racist, violent or hateful content, as well as false information that circulates on your platform. This was Zuckerberg‘s response.
An unexpected cover and Facebook Files (2021)
In April 2021, a large number of data from more than 500 million users are released for free for download, constituting 20% of the subscribers of the social network.
On October 5, there is a general-scale crash of Facebook, Whatsapp, and Instagram for more than six hours, which affected about 3,000 million people, causing Facebook shares to drop by 4.89%, with losses of around 7,000 million dollars. Those six heart-stopping hours occurred due to a flaw in the company’s BGP (Gateway Protocol) routing configuration.
Two days later, the prestigious Time magazine plans to eliminate the social network in a devastating cover with the face of Mark Zuckerberg, who 11 years earlier occupied the same space, but at that time as a person of the year. This report gives voice to Roger McNamee, one of the company’s early investors, as well as a former adviser to Zuckerberg. In the testimony, McNamee charges harshly against the social network, assuring that he pressed on many occasions to reform the platform completely in the face of unstoppable criticism for its management of privacy.
These words coincide in time with the statements of the former product manager in Facebook’s civic integrity team, Frances Haugen. This former worker assured me that the company has not hesitated to put its growth ahead of the safety of its users on many occasions. Her complaints are collected by the Wall Street Journal in a special entitled Facebook Files, where it is revealed:
- A lawsuit by a group of company shareholders
- An internal Facebook investigation acknowledging how Instagram is affecting teen mental health, calling it “toxic” for many
- The constant conflicts of interest between what is good for the public and what is in the interest of the company’s growth
The failed project of Instagram Kids, a version of the social network for children under 13 years of age, after criticism from parents, psychologists, and the political class, prevents taking advantage of the fact that 51% of young Americans who are minors use Facebook compared to 72% who use Instagram. Six years ago, it was 71% of young people used Facebook while Instagram was used by 52%.
The move from Facebook to Meta
Although Facebook can still boast of a huge virtual community, especially by integrating Instagram and WhatsApp users into its company, the truth is that the company has faced its greatest reputational crisis in recent months. Given this, last Thursday, October 28, Zuckerberg himself announced at the company’s annual conference that the brand will be called Meta as of December 1, 2021. All social networks associated with the brand will maintain, yes, its current name.
This new twist involves the creation of a metaverse that will be accessed through a virtual reality viewer, possibly through 3D avatars, and connecting different digital environments. To fully enjoy it, the company estimates that it will take between 10 and 15 years to consolidate a project that will require the collaboration of different companies.
Returning to the social network itself, the increasing lack of credibility, the feeling of manipulation that abounds among its users, and the fact that the youngest are increasingly reluctant to use this platform pose great challenges to which the company must work hard if it does not want to exhaust a formula that is increasingly questioned. That, or what would be worse, an aggressive intervention by governments.
What does seem clear is that his best days on the social network are behind him. There is no worse sentence for someone who was once a giant than to fall into irrelevance. And, if nothing fixes it, that seems like destiny. It is not feasible that a simple name change is a solution to all his problems.
What can we learn from the history of Facebook?
There are many lessons that we can learn from the history of the social network par excellence and its evolution. Let’s list the top five:
- What works today may not work tomorrow. The world changes every day and we must adapt to it.
- The well-being of our users must be ahead of that of the companies.
- Fortunately, times have changed: no one is going to ignore discrimination, manipulation, or the use of people’s vulnerability without consequences.
- Showing up is important. Facing crises from the first minute is necessary.
- Managing the personal data of our users with the greatest possible care will free us from suffering mistrust or, as in the case of Facebook, a multimillion-dollar fine and a reputational crisis…
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