Since the word of Facebook’s data selling scandal was released to the public, their stock has dropped dramatically since. The scandal involved Facebook selling more than 50 million users data to the political consultancy agency Cambridge Analytica.
Cambridge Analytica used a quiz app that was on Facebook to collect data about the user’s friends, family, the things they liked and how they could be swayed in a political sense. Employees from Cambridge Analytica have been filmed bragging that they were the reason behind president Trump’s success in the election.
The obvious bad news and publicity has caused Facebook shares to drop drastically. They dropped below $150 USD for the first time since 2017. Since the newspapers had reported the member data leak on March 17th, the market value of Facebook has dropped by more than $100 billion.
From the public backlash and negative publicity, advertisers that use the social media platform have begun to pull out. Commerzbank (Germany’s second largest bank), Mozilla Corp and Pep Boys (auto parts retailer in the US) have all suspended their advertising efforts on the platform since the new has surfaced.
Advertiser trust isn’t the only thing that’s slipping for Facebook. Canada, Germany and the United States have all conducted and published the results from opinion polls that stated the public no longer trusts Facebook even after the social media platform ran ads apologising to the people of Britain and the US.
The poll showed that less than half of Americans trust the platform to adhere to the privacy laws of the US. A survey that was published in Germany’s largest selling paper found that two thirds of the population fear that other social networks and Facebook have a negative effect on democracy.
75 percent of the Facebook user base in Canada stated that they will make dramatic changes to the way they use social media after the data mining leak.
There’s no doubt that this scandal will alter the public’s view on social media platforms. Even though other social media platforms weren’t involved in the scandal, many other platforms such as Twitter noticed a decline in user activity following the scandal. With the dramatic decrease in trust for Facebook will we see the end of social media all together? Or will we simply give it the Myspace experience and jump onto the new rising trend.