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Facebook signals Mark Zuckerberg will testify before Congress over data privacy scandal

The 33-year-old billionaire’s appearance before Congress would signal Facebook is bowing to pressure at home amid what could be the most serious crisis in its 14-year history.

Facebook is in talks with lawmakers about having its chief executive, Mark Zuckerberg, testify before Congress about the social network’s handling of user data.

The company is in contact with all three congressional committees that have requested testimony from Zuckerberg: the Senate Judiciary Committee, the Senate Commerce, Science and Transportation Committee and the House Energy and Commerce Committee, a Facebook spokesperson said.

The company declined to confirm a CNN report Tuesday that Zuckerberg had made up his mind and agreed to testify about how personal information from 50 million unsuspecting Facebook users ended up in the hands of Cambridge Analytica, a political consulting firm that worked on the Trump campaign.

Zuckerberg will not appear before a British parliamentary committee on misinformation and social media, choosing instead to send one of his deputies, the company said Tuesday.

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An appearance by the 33-year-old billionaire before Congress would signal the company is bowing to pressure at home amid arguably the most serious crisis in its 14-year history.

The Federal Trade Commission confirmed Monday it was investigating the social media giant to determine whether it had violated a consent order to disclose uses of customers’ data. On the same day, 37 attorneys general, including California Atty. Gen. Xavier Becerra, sent a letter to Facebook asking about the company’s data policies and its role in the Cambridge Analytica controversy.

Facebook is also facing a backlash from consumers, highlighted by the #deletefacebook hashtag. The company is now scrambling to win back trust from its more than 2 billion users worldwide.

The scrutiny could amount to a national reckoning about the future of social media and its advertising-based business model that requires collecting evermore intrusive personal data to thrive.

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“Congress is worried about the Pandora’s box of social media, and they want to be seen doing something,” said Betsy Sigman, a professor at Georgetown University’s McDonough School of Business. “Their constituents are nervous about their privacy and the impact social media could have on their privacy and their kids’ privacy.”

By facing Congress, Zuckerberg can show Facebook is serious about privacy — a gesture that could tamp down outrage, Sigman said.

“Facebook made almost $40 billion in advertising revenue in 2017,” Sigman said. “This revenue is made partly because they can target people they have collected data on. They want to keep doing this, obviously, but they also want to be seen as a concerned company.”

If Zuckerberg ultimately decides to testify, it will probably raise pressure on his counterparts — Google CEO Sundar Pichai and Twitter CEO Jack Dorsey — to also agree to requests to appear before Congress.

Twitter declined to comment. Google did not respond to a request for comment.

The three tech giants sent mostly attorneys to speak to Congress about Russian interference last year. If those hearings are a preview of what’s in store, then the executives can expect a tough grilling should they choose to appear.

Scorn is often the price of entry for executives conducting damage control on Capitol Hill. Television industry executives were humiliated in 2000 for calling the results of the presidential election too early, and United Airlines Chief Executive Oscar Munoz was eviscerated last year for his company’s woeful customer relations record.

Zuckerberg drew a strong rebuke Tuesday from Damian Collins, chair of the British parliamentary inquiry into fake news, for refusing to come testify.

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“It is absolutely astonishing that Mark Zuckerberg is not prepared to submit himself to questioning in front of a parliamentary … hearing, given these are questions of fundamental importance and concern to his users, as well as to this inquiry,” said Collins, according to the Guardian.

Facebook said it would send either Chief Technology Officer Mike Schroepfer or Chief Product Officer Chris Cox to explain to parliament how Cambridge Analytica obtained unauthorized information.

The data was derived from a quiz app developed by a University of Cambridge professor in 2013 that collected information from users who downloaded the game, as well as their friends. The professor violated Facebook rules by then selling that data to Cambridge Analytica, which used it to try to sway voters.

Facebook did not inform the 50 million users their data had been compromised nor did it verify if Cambridge Analytica destroyed that data as promised. Facebook amended its rules in 2015 to reduce the amount of information it shared with app developers.

Facebook shares tumbled $7.84, or 4.9%, to $152.22 on Tuesday. That marks a 21% decline in value since its high Feb. 1.

Some Wall Street analysts say the crisis represents a turning point for Facebook that could influence its long-term trajectory.

“We would characterize this as a ‘defining period’ for Facebook, Zuckerberg, and [Wall Street’s] ability to navigate through this hurricane-like storm with the company’s business model still well intact,” Daniel Ives, an analyst for GBH Insights, said in a note to clients Tuesday.


UPDATES:

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3:35 p.m.: This article was entirely rewritten by a staff reporter and updated to include comment from Betsy Sigman, a professor at Georgetown’s McDonough School of Business.

This article was originally published at 10:55 a.m.


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