Top Brands Pull Out of Facebook Ads

Top Brands Pull Out of Facebook Ads

Growing concerns over the rampant spread of false information and hate speech on Facebook has started the #StopHateForProfit campaign prompting hundreds of advertisers to stop spending on the platform resulting in $56 billion loss of market value in a single day.

Crux of the Matter

#StopHateForProfit Campaign
After the death of George Floyd and subsequent anti-racism protests, a coalition of civil rights groups namely Color of Change, National Association for the Advancement of Colored People, Sleeping Giants, Free Press, Anti-Defamation League, and Common Sense Media accused Facebook of not taking efforts to control the spread of racist content online.

The coalition urged businesses to pull their ads from Facebook and Instagram and this movement is now widely known as the ‘Stop Hate For Profit’ campaign. This campaign is now not limited only to the US but also is spreading globally as nearly 160+ companies have decided to not advertise on Facebook for the next 30 days.

99% of Facebook’s revenue is generated from its 8 million advertisers. Though many of them are small companies, there are several big corporations like Unilever Group & Verizon, which alone spends nearly $42 million & $2 million respectively yearly on Facebook ads, that have halted advertising. Some also have stopped ad-spends on Twitter and other social media sites.

Some major brands who have paused advertising on Facebook include CocaCola, PepsiCo, The North Face, Starbucks, Unilever Group, Honda Motor Co, Ben & Jerry’s, Magnolia Pictures, The Hershey Company, REI, and Verizon.

We’re pausing our advertising until Facebook can create an acceptable solution that makes us comfortable and is consistent with what we’ve done with YouTube and other partners.

John Nitti, Chief Media Officer Verizon

Impact
After the announcement by giants like Unilever and Verizon, the shares of Facebook dropped by 8.3% along with Mark Zuckerberg losing $7.2 billion of his net worth. Even in the past Facebook has faced backlashes over its handling of user data but its revenue was never seriously impacted by any of the protests. Facebook has lost nearly $56 billion in revenues.

The advertisers are unhappy with Facebook’s laissez-faire attitude towards posts from US President Trump. The organisers of the 2020 US presidential election fear that a highly polarised audience on social media could increase the potential for spreading misinformation and discriminatory content.

Unilever in India has dropped the word ‘fair’ from its popular skin-lightening product called Fair and Lovely. The outrage over the death of Floyd has led to an unprecedented reaction from corporations around the world.

Response by Facebook
Facebook conducted a conference call with over 200 of its advertisers and informed that they were working towards addressing the ‘trust deficit‘. The founder Mark Zuckerberg announced changes in content moderation policy via a live stream.

Facebook will now necessarily not take down posts that may violate its policies, but will instead begin to label them. The posts that ‘may lead to violence or deprive people of their right to vote ‘will be taken down regardless of who has shared it or whether it is newsworthy. It will also label political speech that violates its rules and take measures to prevent voter suppression and protect minorities from abuse.

I am committed to making sure Facebook remains a place where people can use their voice to discuss important issues. But I also stand against hate or anything that incites violence or suppresses voting, and we’re committed to removing that content, no matter where it comes from.

Mark Zuckerberg, Founder Facebook
Curiopedia
  • Facebook’s main color is blue because Zuckerberg has red-green color blindness. In an interview, he said that “blue is the richest color for me — I can see all of blue.”
  • In finance, FAANG is an acronym that refers to the stocks of five prominent American technology companies: Facebook, Amazon, Apple, Netflix, and Alphabet (Google). The term was coined by Jim Cramer, the television host of CNBC’s Mad Money.
  • Facebook users in the U.S. will have the option to “turn off” all political advertising on the platform. The new feature will give users more control over what they see — at least for users who decide to flip the new setting to “off.”

FB Goes Big on Jio

In the backdrop of markets and industries working on thin line due to Coronavirus lockdown, tech giant Facebook invested $5.7 billion in Mukesh Ambani’s telecom company Jio. This deal has the potential to make Jio a digital mammoth that caters to all the needs of its user through a single digital platform.
Complete Coverage: Coronavirus

Crux of the Matter

The Great Indian Deal
Facebook bought a 9.9% stake in Mukesh Ambani’s telecom company Reliance Jio. This investment of $5.7 billion (₹43,574 crores) values Jio at $65.95 billion (₹4.62 lakh crores). This places Jio amongst the top 5 listed companies in terms of market capitalization in only 3.5 years of commercial launch. This deal is also the largest investment by a tech company for buying a minority stake in another company. It is also the largest FDI in India’s tech sector.

What’s in for the consumer?
The deal turns Jio from a telecom company to a digital giant. A single digital platform that can do the following can come out of the joint effort of FB and JIO:
Calling, messaging
Ecommerce
Ticket bookings
Creating, editing videos
News
Loan applications
Filing tax returns
Money transfer and much more

One focus of our collaboration with Jio will be creating new ways for people and businesses to operate more effectively in the growing digital economy. For instance, by bringing together JioMart, Jio’s small business initiative, with the power of WhatsApp, we can enable people to connect with businesses, shop and ultimately purchase products in a seamless mobile experience.

Facebook

What’s in it for Facebook?
Facebook has a huge market in India. It has:
a) Facebook users: 260 mn users – highest in the world
b) WhatsApp users: 400 mn users – highest in the world
c) Instagram users: 80 mn users – second highest in the world


Facebook is eyeing India’s huge market which is growing at a fast rate. It is looking to benefit from the 400 mn user base of Jio entrenched till the last Indian. In 2016, TRAI shut down Facebook’s Free Basics plan of providing internet. Facebook’s WhatsApp payment service will soon be launched in India and is expected to compete with Google Pay, PayTM, PhonePay, Amazon Pay, etc. The tech giant is likely to drive unprecedented growth through the Indian market.

Summachar Coverage: Microsoft-Reliance Amity: India A Hot Spot For Their Future Digital Ambitions

What’s in it for Jio?
Mukesh Ambani announced to make Reliance debt-free by March 2021 and this deal could help in deleveraging India’s one of the largest conglomerates Reliance Industries. It had ₹1.5 lakh crores of debt as on the financial year ending March 2019. RIL already in talks with Saudi Aramco to sell a 20% stake of the oil-to-chemical division of RIL. Ambani is also in talks with Canadian private equity firm Brookfield Asset Management for selling a stake of telecom towers. In 2019, Jio joined hands with Microsoft for the development of data centers in India with the help of the Azure cloud.

All of us at Reliance are humbled by the opportunity to welcome Facebook as our long-term partner in continuing to grow and transform the digital ecosystem of India for the benefit of all Indians.

Mukesh Ambani, Chairman, RIL
Curiopedia
  • Facebook bought Whatsapp in 2014 for a staggering $19.6 billion deal. This has been one of the biggest silicon valley deals ever. This acquisition was 10 times the acquisition of Instagram by Facebook.
  • The Facebook–Cambridge Analytica data scandal was a major scandal in early 2018 where Cambridge Analytica harvested the personal data of millions of people’s Facebook profiles without their consent and used it for political advertising. It has been described as a watershed moment in the public understanding of personal data and precipitated a 17% fall in Facebook’s share price.
  • Soon after the broadband wireless auction (BWA), in June 2010, RIL bought a 96% stake in Infotel Broadband – promoted by Anant Nahata – that had won 22 circles in the BWA. They started to work as a telecom subsidiary of Reliance, and later in January 2013, they were named Reliance Jio Infocomm Limited. Hence, initially, Jio was called IBSL (Infotel Broadband Services Limited).

Mastercard CEO withdraws from Facebook's Libra over Varied Concerns

Mastercard’s CEO Ajay Banga has pulled out from Facebook’s cryptocurrency Libra, over concerns about compliance, making money, and wallets. He reports that Libra’s leaders wouldn’t commit to observing laws, so he couldn’t see how the digital currency would make money. The social networking giant’s plan to store the coins in its Calibra digital wallets did not go well with him either.

Crux of the Matter

What is Libra ?
Libra is a global currency and financial infrastructure developed by Facebook
Built on a secure, scalable, and reliable blockchain, it is a stable coin which is backed by a reserve of assets. It is governed by the independent Libra Association and uses the LibraBFT consensus mechanism. Facebook aims to have 100 members in its Libra Association before the launch, which in on first half of 2020.

The crack in the partnership
Ajay described the lack of a clear business model as a cause for major concern, stating that he could not see the future of their vision to become profitable. The association’s members were not ready to commit to anti-money laundering or data management controls wither. Mastercard jumped ship from the project in October, along with PayPal and Visa, just as the official charter to establish the Libra Association, a nonprofit body overseeing the project, was signed in Geneva.

The red light on Libra
Libra has faced intense scrutiny in recent months as EU competition regulators continue to probe them. US lawmakers grilled Facebook’s CEO Mark Zuckerberg last year on subjects such as Facebook’s handling of financial data, its cooperation with regulators, and why it wants to develop a substitute for the dollar. The association had started with 28 founding members in June 2019, but over the months eight firms have left. Telecom major Vodafone was the latest to withdraw when it decided to focus on its own payment products. Facebook is yet to comment officially on these withdrawals.

Curiopedia

Blockchain is “an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way”. It is a growing list of records, called blocks, that are linked using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data.

By design, a blockchain is resistant to modification of the data. For use as a distributed ledger, a blockchain is typically managed by a peer-to-peer network collectively adhering to a protocol for inter-node communication and validating new blocks. Once recorded, the data in any given block cannot be altered retroactively without alteration of all subsequent blocks, which requires consensus of the network majority. Although blockchain records are not unalterable, blockchains may be considered secure by design and exemplify a distributed computing system with high Byzantine fault tolerance. Decentralized consensus has therefore been claimed with a blockchain.

Blockchain was invented by a person (or group of people) using the name Satoshi Nakamoto in 2008 to serve as the public transaction ledger of the cryptocurrency bitcoin. The identity of Satoshi Nakamoto is unknown. The invention of the blockchain for bitcoin made it the first digital currency to solve the double-spending problem without the need of a trusted authority or central server. The bitcoin design has inspired other applications, and blockchains that are readable by the public are widely used by cryptocurrencies. Blockchain is considered a type of payment rail. Private blockchains have been proposed for business use. Sources such as Computerworld called the marketing of such blockchains without a proper security model “snake oil”. More Info

False data on Anti-HIV drug PrEP, found circulating in Facebook Ads

truveda drug

Medically incorrect targeted advertising has been found in various LGBTQ+ users’ newsfeeds, on the social media giant Facebook. The malignant ads claim that despite having a safer alternative in their inventory, the manufacturers kept selling the dangerous one called Truvada.

Crux of the Matter
  • Truvada, an anti-HIV drug PrEP, is a one-pill-a-day pharmaceutical that has been known to lower the possibility of HIV transmissions by 99%.
  • Reports suggest that the ads in speculation, are being paid for by the Virginia law firm, KBA Attorneys. It cites unspecified bone and kidney conditions as side-effects from Truvada and seeks to file a product-liability lawsuit against manufacturer Gilead Science.
  • Due to a drought of information about HIV-prevention in traditional media, Experts fear such misleading promotions in newsfeeds can prove to be a major setback for at-risk people reading them.
  • Consequently, an open letter has been published by LGBTQ+ advocacy organization, Glaad on 9th December, in an attempt to make Facebook commit to a review on the current advertising policies and debunk further claims done on public health statements.
Curiopedia

HIV or the Human Immunodeficiency Viruses are two species of Lentivirus that causes HIV infection and over time acquired immunodeficiency syndrome, a condition in humans in which progressive failure of the immune system allows life-threatening opportunistic infections and cancers to thrive. This medical condition continues to disproportionately impact gay and bisexual men, transgender women, youth and communities of colour, with over 1.2 million people living with HIV in the United States More Info