The real threat to Facebook and Twitter isn’t a pandemic or a president

[Business Insider]

This week: The biggest threat to Facebook and Twitter 

It feels like ages ago, when the coronavirus lockdowns began in March, that skepticism about social media screentime and digital health were summarily cast aside. Who’s got time to worry about those kinds of things when you need a crucial lifeline to the outside world?

Since then — notwithstanding the Gen Zers who credit funny memes for giving them the strength to endure the crisis — our collective relapse into social media has come with harsh reminders of why we grew wary in the first place.

• Roughly half of the Twitter accounts clamoring to “reopen America” are actually bots, according to a recent Carnegie Mellon University study.  (Though some have cast doubt on Carnegie Mellon’s methodology.)
• Various doctors on Facebook boasting verified “blue checkmark” accounts (but not necessarily medical degrees) are pushing coronavirus misinformation and peddling dubious cures to hundreds of thousands of followers.
• Facebook discovered that more than half of the extremists who join its groups in 2016 were lured by the company’s own recommendation tools, but proposals to fix the situation were dismissed or diluted by CEO Mark Zuckerberg and others, according to a Wall Street Journal report.
• And recent complaints to the FTC claim that TikTok is not complying with the terms of last year’s settlement with the agency involving its collection of children’s data.

On Wednesday, Facebook is holding its annual shareholder meeting (virtually) and Zuckerberg, who has spent the past few years promoting “time well spent” on the social network, will have to offer up some explanation for his company’s apparent indifference and disdain for its professed values.

As far as business problems go right now, Zuckerberg’s predicament may seem like a mere PR headache. Facebook’s business, at least as of the end of April, was still relatively strong and enchanting investors. That’s a much better place to be than federal bankruptcy court, where giant companies like Hertz, Gold’s Gym and J. Crew are squaring off with creditors; And it’s a lot easier than laying off thousands of employees, as General Electric, Uber, IBM and many more are doing.

But for social media services — whether it’s Facebook, Twitter, or even YouTube — there’s a festering problem within the business that’s not reflected in income statements or balance sheet, and it’s getting worse every day. Put simply: Social media services have absolutely no idea why they exist anymore other than to simply keep all the plates in the air.

Twitter used to brag about being the “free speech wing of the free speech party.” You may or may not have admired it, but it was a principle employees and users could understand. Now Twitter is an ugly knot of contradictions and ineffective posturing that’s left it in the humiliating position of getting publicly chastised by the very person it’s contorted itself for.

YouTube, which has the power of Google’s army of computer programmers and AI experts behind it, looks incompetent with each new colony of conspiracy videos discovered on its site. And Facebook looks even more brazen and unscrupulous at this point. 

This isn’t a problem that’s going to blow a hole in any of these businesses overnight. Facebook’s family of apps has 3 billion users. It would be a remarkable feat to lose the trust of 3 billion people at once.

But the way it looks now, the biggest threat these businesses face isn’t disruption by a new technology or competitor, or even by a regulator or a pandemic. The biggest threat is what the social media companies have done to themselves by disrupting their own sense of purpose.

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Exodus, Silicon Valley

Is Silicon Valley’s reign as America’s innovation capital over? It’s one of the biggest questions being discussed in these parts after several big tech companies, including Facebook and Twitter, announced that employees will be free to work from anywhere. 

How many employees pack up and relocate to a cozy mountain cabin or a tropical island is an open question, and there are good arguments why the exodus might not be as big as some people expect.

But here are 3 reasons why, if nothing else, Silicon Valley is likely to see an influx of movement (both leaving and entering the region):

Informal surveys indicate there’s significant interest among Silicon Valley techies to relocate to greener pastures, even if moving means having their salaries “adjusted” to their new homes.

There are lots of places in the US that are not San Francisco, New York, or Boston, that are attracting an increasing share of venture capital dollars. 

And there’s a thriving generation of innovative, VC-backed startups creating tools to cater to remote workers.

By Alexei Oreskovic