Can Facebook Lead?
A Google news search for Facebook reveals one thing: the news for Facebook has not been good. Antitrust violations, Russian trolls returning for the 2020 elections, takedowns of misinformation campaigns, Libra’s struggles and more bad news make up the headlines I’m seeing today. The headlines are different from a year ago, but the takeaway is the same: Facebook is struggling to come to terms with its massive size and scale.
This week Mark Zuckerberg appeared before Congress to make the case for Facebook’s digital currency Libra. HIs argument boiled down to one main thing: if the U.S. doesn’t lead with a global cryptocurrency, someone else (read China here) will. He stated that he’s willing to link Libra closely to the dollar and said Libra won’t operate anywhere U.S. regulators don’t approve.
His testimony, however, did not focus solely on Libra—far from it. Facebook's sins were on full display as Zuckerberg was grilled for foreign interference in U.S. elections, misinformation on the platform, race and gender disparities, privacy practices and political advertising policies.
The U.S. backing a global digital currency may be the right thing to do, pending a lot being figured out as pointed out by the G7, but it’s not just a question of whether or not such a thing should exist. Another question is whether or not Facebook is the right company to lead it.
Facebook is one of the most reactive companies out there. The company has shown little success in proactively building and innovating. It’s built a massive advertising company, but it’s been unsuccessful in building anything else. Instead, it’s opted to acquire innovation: Instagram, Oculus, WhatsApp, MSQRD and many others. Facebook has yet to show that it can build and grow something from the ground up since its original product.
It’s not just a sketchy track record when it comes to innovation, however. It’s also hesitant to lead. The platform has adopted a “free speech” policy to its platform that allows it to profit from misinformation that receives high user engagement. It’s a “not our problem” approach. Zuckerberg even called for the government to tell it what speech was okay and what wasn’t. Speech on its platform is a sticky issue, and it’s an issue Facebook doesn’t want to accept as its problem.
A global digital currency is not going to be a simple thing to manage. Facebook has a track record of reacting to things and not anticipating consequences, and it’s shown a reluctance to lead in the areas that matter most. It’s asking for permission to lead a massive endeavor. It hasn’t done it before, so why should it be able to now?