Facebook CEO Mark Zuckerberg spent 10 hours over two days getting gently grilled by lawmakers, and we were there.
On this episode of Too Embarrassed to Ask, Recode’s Kurt Wagner and The Verge’s Casey Newton talk with Kara Swisher about Facebook CEO Mark Zuckerberg’s two-day marathon of hearings in front of Congress.
You can read a write-up of the interview here or listen to the whole thing in the audio player above. Below, we’ve posted a lightly edited complete transcript of their conversation.
Kara Swisher: Hi, I’m Kara Swisher, executive editor of Recode, and you’re listening to Too Embarrassed to Ask, coming to you from the Vox Media podcast network. This is a show where we answer all of your embarrassing questions about consumer tech and the week’s news. You can send us your question on Twitter with the #TooEmbarrassed; we also have an email address, TooEmbarrassed@recode.net. Remember, there are two Rs and two Ss in embarrassed.
This week, Recode sent our very own Kurt Wagner to Washington, D.C., the swamp, to cover Facebook’s CEO Mark Zuckerberg two-day marathon of hearings, testifying in front of both houses of Congress. He’s joining us now from his hotel room, hopefully with a drink in his hand. Welcome back, Kurt.
Kurt Wagner: Hi, Kara. No drinks yet, but soon.
Hi, how you doing? Okay, soon.
KW: As soon as this is over I’m hitting the town, yeah.
Oh wow. It’s such an exciting town; I used to live there. We’re also joined here in San Francisco by the Verge’s Silicon Valley editor and fantastic tweeter, Casey Newton. Hey, Casey.
Casey Newton: Hey, Kara.
How you doing?
CN: You know, it’s been a lot of liveblogging, but I’m always excited to talk to you.
How exciting for me in general. On Tuesday, Mark testified for five hours at a joint session of two U.S. Senate committees. We’re recording this late on the day, on Wednesday, when it was finally all over after the conclusion of his appearances. This one today was the House Energy and Commerce Committee. Yesterday was the Senate Judiciary and Commerce Committee combined. I think it was 80, almost 90 people, 90 politicians, that he answered questions from in little four- and five-minute segments.
Let’s start with Tuesday, where he talked to the Senate. Why don’t we start … Kurt, since you were in the room, why don’t you describe it, and then we’ll talk a little bit about what everybody thought of that day. Let’s start with Tuesday. Kurt, why don’t you set up the scene.
KW: Sure, yeah, it was a bit of a zoo. I knew it would be a little crazy, but I’ve never covered something like this before, so I didn’t how crazy. It was in what I’m told is is one of the nicest if not the nicest hearing room that they have in the Senate building that’s right across the street from the Capitol. There were people lined up to get in, there was limited public seating, but I would say there were people lined up a hundred yards down the hallway. Everyone, people were protesting, they had shirts on that said, “Delete Facebook.” The person who was first in line told me they got there at 7:15 in the morning, and I think things started officially around 2:15, 2:30 in the afternoon.
KW: There was a ton of interest in this and a lot of press. There were TV cameras everywhere, a million photographers. It was quite the spectacle.
You were sitting right near Mark, right?
KW: I was there.
You were sitting in a series of tables right? There were lots and lots of press.
KW: I kinda got lucky. They had five tables set up, six people on each side, so that’s 70 press, or let’s see, 72 press, whatever that is. I happened to have a decent seat. You could not move, though, because you were so packed in there. They gave you a bathroom break, and you had to just book it, because there was no way you were getting up in between.
Oh wow, and who were you sitting next to, may I ask? Who was around you?
KW: You may ask. It was no one that I actually knew, but there were a lot of reporters that we do see, and I do see frequently. Sarah Frier from Bloomberg, Alex Kantrowitz from BuzzFeed, Ian Sherr from CNET, all of the …
You went to a tech party, a tech reporter party.
KW: All of the folks except for Casey.
Who runs the tech gatherings here in San Francisco. So Casey, why weren’t you there?
KW: Casey’s the boss dog, so he sent all of us.
Yeah, I know. Casey, why didn’t you go?
CN: That’s a fair question, probably better directed at my editors. What’s interesting about these hearings is that while you can probably do some buttonholing of Facebook staffers or congressional staffers in the hallways, most of what you’re interested in is happening during the hearing, which you can see via free livestream at your desk. I didn’t really feel like I was at much of a disadvantage just kind of blogging in a more comfortable environment than Kurt was in. Given that it was 10 hours worth of hearings, I feel pretty okay about it.
You weren’t steeped in the beauty of the room in Washington, and among in between all the wonderful Senators on Tuesday, for example. You didn’t get their incredible intelligence.
CN: Well, I’m always awestruck by the majesty of our democracy, and hopefully I’ll have a chance to observe that in person soon.
Yeah, all right. Let’s start with you, Casey. On Tuesday, what did you think of the Senate hearings?
CN: Well, I think elsewhere, Kara, you described Tuesday as Mark being hit with a bunch of soft satin pillows, and I think that’s a pretty apt description. But more even than the kindness of the Senators or their deferential questions, I was just struck by how little they seemed to understand Facebook. You have Senator Orrin Hatch asking how Facebook is able to operate given that it doesn’t charge a subscription fee, apparently unaware that Facebook has an advertising network. He just had a lot of questions to ask.
Yeah, that was … Oh, he went, “Oh, oh, I see.” Awesome.
CN: Yeah, yeah. Frankly, a lot of Senators … In a five-hour hearing, I would say that at least three hours worth of the questions you could’ve answered by yourself just by Googling. That was really disappointing for me.
Yeah, all right. Kurt, what do you think about that?
KW: Yeah, Casey hit it, nail on the head, I think. I thought the questions were not nearly as aggressive as I thought they were going to be, and as Casey mentioned I think a big part of that is just the lack of general understanding of the Facebook business and how its services work. At the same time, I think that’s also important to realize, because there are a lot of people who don’t understand how Facebook’s business and services work. It’s not just the politicians.
Even though we maybe didn’t get the questions that we had hoped for or been looking for, I do think we got a crash course in the fact that there’s not a lot of people that understand Facebook these days. We need to do better — or Facebook needs to do better — at explaining it.
What do you imagine, any news that you … I mean, one of the people that I thought started off well was a Louisiana Senator, I forget his name. He started like, “Your terms of service suck.” He was very folksy, like he just kind of wrestled an … John, the guy from Louisiana, right?
KW: I think it was John Kennedy, wasn’t it? I think it was John Kennedy.
Kennedy, yeah. Anyway, it looked like he was going to wrestle an alligator right after. He started off strong with his folksy humor and stuff like that, but then didn’t know how Facebook worked, which was fascinating, and didn’t have any good questions.
All right, let’s start with good questions. Let’s have positivity towards our elected officials. Casey, what was a good question with a decent answer? I didn’t think he had any decent answers that day.
CN: Well, a couple of Senators asked serious questions about the business model, and whether Facebook would ever consider some sort of paid version. I’m not someone who thinks that a paid version of Facebook solves all of its problems, but I do think that a world in which Facebook has more ways in which it makes money — and maybe vacuums up slightly less of our data — might be a better world. I was at least glad that the Senate introduced that subject.
Okay, what about any other revelations? Any other good questions? And then I’d like to know what good answers. We’ll get to Mark in a second, but any other good questions you thought were brought up?
CN: There was another one about Facebook’s monopoly power. Lindsey Graham asked Zuckerberg to name his biggest competitor, and Zuckerberg couldn’t. I think that probably came as a surprise to the Senate, and will maybe make this one of the first times that Facebook is forced to confront its size and its power. In fact, another Senator, I’m pretty sure, at one point asked whether Facebook was simply too powerful. It might’ve been Graham.
CN: And Zuckerberg said, “It certainly doesn’t feel like that to me.” On the question of whether Facebook has a monopoly, it’s notable that Graham is a Republican and a lot of the questions about Facebook’s power were coming from Republicans. I guess that was another hopeful sign, that Senators are grappling with that.
All right. Kurt, good questions? Anything that struck you?
KW: Yeah, I thought the monopoly one was good. I also thought that there were a number of politicians over the last two days that talked about this idea of changing the default opt-in privacy settings. How most of the internet works, quite frankly, is that companies and services collect data about you, and you have to tell them to stop. You have to opt out of that kind of thing. There were a bunch of politicians who said, “Hey, would you change this so that everyone has to opt in at the very beginning?” And you probably do by clicking the “I accept” button when you create your account, but really no one reads that stuff.
KW: Mark Zuckerberg didn’t have a super great answer, because he was like, “Hey, this is a really complex thing, we can’t just answer this in a one-word sentence. We need to think about it.” The big reason I can think of is that would be bad for Facebook. If everyone had to explicitly say, “Yes you can take my birthday, yes you can take my email, yes …” They would probably say no to a lot of that stuff, and as a result, Facebook wouldn’t have all the data that they have today.
KW: I thought that was a compelling argument, and then because I heard it so many times throughout the two days, it makes me think that that might be a realistic chance for Congress to come in and actually regulate a little.
What was the worst question? I’m going with Ted Cruz. The loathes of Ted Cruz. He brought up the diamonds and …
KW: Ted was pretty bad.
What are they? Diamonds and pearls? The conservative site that Facebook has messed with. That was a big deal for him, but he did it in such an unpleasant way it made it … The other congressman asked about it and seemed perfectly reasonable, but he wasn’t.
CN: I have a candidate for the worst question.
All right, go ahead.
CN: And that would go to Senator Gary Peters, Democrat of Michigan, who asked whether Facebook is using our phones, microphones, to spy on all of our conversations and target ads.
Oh yeah, yes.
CN: Of course, this is a very popular urban legend, and I guarantee that just by …
Explain it, explain what people think.
CN: Well, okay. Yeah, as the legend goes, Facebook is monitoring your phone at all times, and so if you were to say something like, “I love Doritos,” then the next time you open up Instagram you’d see a big ad for Doritos. Even by me just saying this now, I’m sure I will get tweets from people telling me that this exact thing happens to them. Everybody has an antidote about this happening, and so it’s now just become part of the fabric of the internet. It’s also completely ridiculous.
It’s probably illegal in most states. There’s no way Facebook could ever get away with this, and there’s actually a really good explanation for how this happens, which is that none of us are the unique snowflakes that we think we are and big consumer brands are advertising to targeted demographics all the time. The truth is, Facebook is just really good at targeting ads, but there’s this whole conspiracy theory that has sprung up around it. The reason that I think it’s a bad question, is just by entering it into the congressional record, it can now just be fodder for endless speculation.
You’re right. Oh yeah, it’s like aliens.
CN: Exactly. It’s like, this is the new Area 51 and there’s just going to be speculation about it forever now.
I know. Yeah, that’s a really good point. It’s Google that’s listening to us, and Amazon, everybody, let’s get that clear. Kurt, what’s your worst question?
KW: That Orrin Hatch one we already talked about, where he asked, “How do you expect to keep the business going if nobody pays you for your services?” Mark just stared at him and said, “Senator, we run ads.”
Yeah, he couldn’t help it. Yeah, advertise, “Advertising?” That was a …
KW: And it was like, oh well that was awkward.
Yeah, he’s retiring this year right? Yeah that’s probably …
KW: I don’t know.
CN: I hope so.
KW: That wasn’t very smart.
No, it wasn’t smart. All right, let’s get one of our listeners, @yanjaatweets: “How will the Facebook hearing affect young voters’ view and trust of Congress and the people representing us have thus far shown an inability to ask the right questions, as well as being astoundingly technologically illiterate?” That just speaks for itself. I think they probably weren’t watching, would be my guess, but …
KW: Yeah, that’s what I was just going to say. I mean, I’d be shocked if very many millennial voters were watching the livestream of this. Although, if they did, they might say, “Wow, our politicians are pretty old.”
There’s new studies coming out saying they don’t trust Facebook, so each of you, what was Mark Zuckerberg’s best and worst? Why don’t we do that quickly, best and worst. Casey?
CN: Yeah, I mean I would sort of answer that question at a very high level. He was calm, he was friendly, and he endured. Five hours is a really long time to be taking questions, even if they are relatively friendly. He was able to successfully parry any of their very gentle attacks, never got flustered, never raised his voice, never seemed out of control. By the time he was done testifying, I think Facebook had gained something like $20 billion in market cap. It was just a very steady assured performance for him.
Yeah, yeah. Anything you didn’t like? Besides repeating broad, “We take broad responsibility.”
CN: I wish he had openly mocked the idea that Facebook is listening to people through their phones. He was almost too deadpan. I think in fact he just said, “No, we don’t do that.” In the same way you’d be like, “Hey, do you have any more ice cream?” It’s like, “No.” That kind of question deserves a more emotional response.
He wasn’t going to do that. He didn’t have a lot of emotion, he didn’t.
CN: Well, think about it, Kara, if I accused you of spying on me, which first of all you probably are, but if I accuse you of spying on me …
I am, a cat is.
CN: Yeah, and you weren’t, you would just be like, “Screw you, no I’m not spying on you.” Rather than just be like, “No, I’m not, next question.”
Mark tries not to offend anybody. Kurt, what did you think of his performance?
KW: I enjoyed the admission that he said no one actually reads the terms of service. I thought that was cool because I think we all know that, but I didn’t really expect him to honestly say, I think his direct quote was something like, “I don’t think the average person likely reads the whole document.” At the same time, that translates to, “People don’t read our terms of service.” I just think that’s true. Who reads the Facebook terms of service besides us, the journalists who have to? I just liked that.
I think his response to the monopoly thing where he’s like, “It doesn’t feel like that to me.” It seems very clear to me that there’s no one really competing with Facebook in the social space, but I love his reply.
One thing that didn’t seem to come up, and then we’re going to go to the ads in a second, is our own ads, which we’re targeting towards you, is Cambridge Analytica, or the Russia stuff really didn’t … It wasn’t a lot of it. They seem more interested in terms of service then they did in privacy, using your birthday and stuff like that, than they did about Russia using the platform to abuse our democracy. What do you think, Casey?
CN: Well, I think we’ve learned in the past week that Facebook has between 500 and 700 people working on communications and policy, and they have been busy over the past three weeks. One of the things that they have done is to roll out some reforms that get at the Russia issue in a pretty real way. They’re going to make all ads viewable online for all of us to see, they’re going to introduce some new verification standards. By sort of rolling these out in a drip, drip, drip way over the past few weeks, Facebook has been able to suck a lot of the air out of the Russia story because they’ve said, “Look, we’ve introduced these reforms, we’re beefing up our AI tools so we’re catching more of these bad actors before they act.”
They’ve been able to present the case that they’re taking it seriously, and also that they’ve done better in more recent elections than they did in 2016. I think that is one fire that they have managed to put out for now, although of course we are watching it very closely as we move into the midterms.
Right, okay, and what do you think, Kurt?
KW: Well I do think they talked about Cambridge Analytica a ton, I agree Russia wasn’t discussed as much, but you have to remember they also did an entire hearing about Russia. Two days of hearings actually, back in the fall. It wasn’t Mark Zuckerberg, but it was their general counsel, Colin Stretch, who was there answering hours of questions. I think we’ve heard so much about Russia already that this was a chance to dive in more on the data and privacy stuff more broadly. Cambridge Analytica was certainly mentioned a lot over the two days, the Russia stuff not so much.
Yeah, yeah, it was interesting that they didn’t do that at all. So score for who on the first day? Not the American people, for sure.
KW: I say score for Mark Zuckerberg and Facebook on the first day. I thought he did pretty well.
CN: Yeah, I’d have to agree with that. The main thing you want to do in that situation is just not fan the flames or introduce any new crises, and Zuckerberg didn’t. Although he’ll probably keep a tighter grip on his notes next time around so that the Associated Press can’t snap a photo.
Yeah, that. Explain that, explain that. Do you think he did it on purpose?
CN: No, I don’t. He had a binder full of talking points and left it open at some point, or it was being passed around, and an enterprising AP photographer happened to grab a shot of it. What was so great about it was that it let us know the questions that he was prepared to answer that no one thought to ask him. Such as about what Apple had to say about Facebook, for example, or what was Facebook doing to improve diversity in its workforce? It wound up being a very valuable photo.
Yeah, and did you think, Kurt, that they did it on purpose?
KW: No, I don’t think Mark … Well, I don’t think Mark would’ve done it on purpose. Maybe there’s some mastermind behind the scenes that told …
KW: Yeah, I wasn’t going to drop a name. Maybe Elliot told him to do it. I don’t get the vibe that Mark would be thinking about leaving that there on purpose, but who knows? He did his whole thing, which originally I thought seemed sincere, where he did a conference call with reporters last week and they tried to end questions, and he was like, “No, no, I want to take more questions.” I was like, “Oh that’s cool, look at him, he’s really … Wants to keep going, wants to keep taking the tough questions.” Then he did the exact same thing yesterday in the Senate, and I was like, “Oh, maybe this whole thing was just an act.” Which, I guess I shouldn’t be surprised at this point, right? But there you go.
Yeah, I don’t know, I think maybe they did it on … I don’t think you do things like that. He has so many attendants around him, I don’t know, I don’t know.
KW: There were a lot.
It was interesting that there was stuff on there that he didn’t talk about, including Apple, he had a really pointed attack on Apple. Largely due to our interview, my interview with Tim Cook I think, and they continue to be thin-skinned about that one, which was interesting. Anyway, is there anything that wasn’t covered, did you think? There was a lot on his sheet but not a lot on theirs, they stuck to the same areas.
CN: Well again, they had to spend five hours just figuring out how Facebook works. It was really like, “How do you log in to this website? Hey look, where do you find it? How do you get to it?”
“Wait, what? It’s this thing my grandchildren told me about.”
Anyway, when we get back, we’re going to take a quick break to hear from our sponsors. We’ll keep talking about this week’s most popular movie, “Mr Zuckerberg goes to Washington,” after this break. Kurt, can you give your best reading of the line #money?
We’re back with Recode’s Kurt Wagner and The Verge’s Casey Newton, they both covered the Facebook marathon — Zuckathon — in Washington this week. We have a few more questions about, we have just one more about Day One, and then we’ll get into Day Two. One of our readers, Denise Klein, wrote in about something Senator Lindsey Graham said, “Is Facebook a monopoly?” Which we just talked about. Neither of you think there’s a … I’m not going to read the whole thing since we talked about, but do you think there’s any chance that it would be broken up? Casey?
CN: Not under this administration, but I do think that if Instagram and WhatsApp continue to grow and grow and grow and no true competition emerges, then they will be under increasing pressure to spin one of those off.
Yeah, and they just stole another Snapchat thing this week, right? Instagram did something else, something else. They just did another copy of something on … Which is interesting. See, they keep doing that, that’d be interesting.
Kurt, you wrote on Recode that Zuckerberg came off as smart and respectful, and, “I don’t think anyone would watch this and be more angry with Facebook than when the hearing started.” Well, one of our readers took you up on that challenge. Deborah Klopfenstein emailed in to object and she wrote, “I’m more angry than ever about all this. Not okay. Love your show, but shame on Recode for leading with Zuckerberg sounded smart. No he did not.”
Let’s talk about the big picture, would you say that the first day was a win for Facebook? Yes, I’m sorry Deborah, he did sound smart, and he did win the first day. What do you guys think?
KW: Yeah, I’m with you, well, you just read what I wrote, so I’m clearly with you. I thought he came in and said all the right things, and he dodged a few questions for sure that I think if it had been some tech-savvy reporter up there he probably would’ve gotten pushed on. He did what they asked him to do, and I think he looked fine doing it.
All right, and let’s get into the second day now. Casey, Day Two: Different, right? A little testier, which started off testy.
CN: It was a little testier, but even more important than that was the fact that the members of the House Energy and Commerce Committee seemed to understand the platform. I think their staffers had briefed them very well, for the most part, on how Facebook worked and what some of the more relevant questions were. Yes it did get quite heated, and to be frank there was also more grandstanding, mostly by the Republican lawmakers about ridiculous non issues. Overall, I would say it felt like a more productive day.
Right, and some of the highlights you think? What were some of the highlights?
CN: Well for me, one that has some real practical impact is that Facebook said in the clearest way yet that, yes, it would bring European privacy protections to people around the world. We’d been getting some mixed messages on this, and today Zuckerberg said that, yes, it would offer privacy controls that are based on what is known as the general data privacy regulation, or GDPR, which goes into effect in Europe in May. One of the great things about the GDPR is that it enables individual citizens to understand all of the data that a company like Facebook has about them and gives them some more legal rights over what they can do with it. That, I would say, is a definite highlight.
Another thing to think about is multiple lawmakers told Zuckerberg straight up that they think Facebook has violated its 2011 consent decree with the Federal Trade Commission. If that is true — and that is currently under investigation — that could cost Facebook a billion dollars, maybe. That was kind of a big deal.
Yeah, the FTC thing I thought was very important. Kurt, what do you think?
KW: It definitely started off much more aggressive than yesterday. I think towards the end it ended up being … I think the wind went out of everybody’s sails, because people were tired after four hours, five hours of conversation. It did, I agree, it started off a lot more aggressive, there were a lot of people cutting him off mid-sentence, they were asking very pointed yes or no questions, and when he would try to explain, they would cut him off and say, “We want a yes or no answer.” I thought overall it was a better day.
I agree with Casey on the GDPR stuff, I thought he was much clearer about that than he had been, and that was good. I mean, overall, again, I think he did fine. There were a few stumbles, or a few things that I’m …
He did get bothered, he got bothered today.
KW: Yeah, now I’m intrigued a little bit more about some of the stuff he said, like, hey, what’s the follow-up on this, which I didn’t really feel like yesterday, so I’d say that overall … I won’t say it’s a win necessarily for Congress, because it didn’t feel like a loss in any way for Facebook, but it definitely felt more even than it was yesterday.
Yeah, I think so. I thought Debbie Dingell was particularly good, she came off initially folksy and then went in for the shark attack, which I thought was interesting. She had a range of things, and so did another congressman talking about whether we can trust Facebook. Casey, what did you think?
CN: Yeah, I think there was a really good set of questions in there about how Facebook tracks people around the web and why they do it, both people who have Facebook accounts and people who don’t have Facebook accounts. One of the big surprises of today was someone asked Zuckerberg about what are known as shadow profiles, which are accounts for people who have either not created Facebook accounts yet or gotten rid of them. Zuckerberg said he was unfamiliar with that term, which I think surprised a lot of us since it’s a fairly common term to refer to the data collection that Facebook does for these people that don’t have profiles.
The thing that was so good about this testimony was that it spoke to the vast nature of Facebook’s operation around the web, and everything it does to figure out what you’re doing, what you’re seeing, and then turn those into categories that advertisers can target you for. Frankly, I thought Zuckerberg was very evasive on some of those questions.
And also the data dealers that they add, they supplement profiles with, to try to get even more. “I thought that we ended our relationship with them.” I thought he seemed more sneaky, I thought he seemed a whole lot more sneaky, and a whole lot more malevolent today, like that he’s in charge of a big … I don’t think he looked as sweet, I think he definitely looked as … Maybe it was the blue suit.
CN: Right, well also, they brought up Facemash. This was also one of the other big surprises of the day. In 2003, Zuckerberg creates this website where you take pictures of two college girls and compare them to see which one is more attractive. One of the lawmakers brought that up, and Zuckerberg dismissed it as a college prank. I’m not straight, but most of the straight guys I know don’t compare the beauty of women as a prank. Anyway, it just made for a surprising addition to the days questions.
Yeah, it was “The Social Network” Zuckerberg, not the boy genius billionaire Zuckerberg.
CN: Yeah, exactly.
I thought it was, and I thought he was very evasive on a bunch of things, I think you’re right. Kurt, did you feel like that was an issue?
KW: Yeah, well, I think he got a little defensive and he did a pretty good job of not snapping back. He wasn’t disrespectful or anything like that, but one of the big moments that stood out for me was Congresswoman Jan Schakowsky, and I’m probably mispronouncing that.
Yeah, she was great.
KW: She was good, and she actually brought up a line of questioning that I hadn’t really heard before. She was like, “Did this Alexandr Kogan guy, this professor who collected all the data and sold it to Cambridge Analytica, did he sell it to other firms?” And Zuckerberg basically said, “Yes.” And she said, “How many?” And he goes, “It’s not a large number.” She goes, “What’s a large number?” He goes, “A handful.”
He refused to either A) say how many other firms were sold this data, and B) refused to acknowledge or name them. I thought that was really weird. He’s here to open up the kimono and tell the truth and all that stuff. Why not simply be straight about all that, right now, today, while he’s on the spot? That really stood out to me.
Yeah, he didn’t really give a lot of details. Yeah, I agree.
KW: Yeah, that stood out to me as a moment.
And the person that kept, “Aren’t you CEO? Aren’t you CEO?” I liked that, who was that? That was another, I don’t think it was her, it was a congresswoman before her. It was interesting, a lot of the women were much tougher on him, they weren’t having any of the aw, shucks, aw it’s Mark Zuckerberg thing, which I thought was interesting. There were many more women asking questions, actually, and they were much tougher, I think, than a lot of the guys. Of course, there were still the suck-ups, there were one or two suck-ups, and several conspiracy theories going. Then there was of course the conservative thing. What did you think about that? That they are mean to conservatives, essentially, or they’re biased against conservatives.
CN: Well, it’s such an absurd argument. In various months, the No. 1 publisher on all of Facebook is Fox News. It’s consistently No. 1 or 2 or 3, getting tens of millions of engagements. As we saw during the election, it was these conservative viral hoaxes that tended to spread farther and faster than liberal ones. The idea that Facebook’s algorithms have put conservative-flavored news at a disadvantage is completely absurd and there’s no data to support it. We had to listen to, I think, about 10 congressmen today, 10 congressmen say, “Hey, you need to support the freedom of speech on your platform.”
Yeah, that was interesting, and they were supporting a particular site, Diamond … I’m blanking, why am I blanking on the name? Diamonds and …
CN: It’s Diamond and Silk, who are these pro-Trump bloggers, and this … People need to do more reporting on this story, because it doesn’t make any sense. They’ve got 1.4 million followers, and their gimmick is that they support President Trump, and they are black women, which makes them somewhat unusual. They’ve got a lot of attention from the conservative blogosphere. At some point this year, Facebook started, prevented them from notifying their followers about new posts, and might’ve reduced the reach of their posts, and it’s not clear how much of that was directed at them personally, and how much is related to …
The algorithm change.
CN: Changes to the News Feed algorithm. I’ve read the stories about it and I have no idea what’s going on, but …
You need to get to the bottom of this. You need to visit Diamond and Silk. I need you there, I want to find out, one of you get there, quickly. I like the name, it’s a fantastic name, it’s not very conservative-sounding.
In any case, we’re going to toss to another ad break right now for a word from our sponsors. In a minute we’ll finish talking about the rest of Mark Zuckerberg’s testimony and take some questions from listeners. First Casey, give me your better reading of #money, please.
Oh Casey, Casey, Casey. Anyway, today’s …
CN: How is it supposed to sound?
Listen to Kurt. Kurt, do #money.
It makes you want to buy, Casey. Do you understand? We have to teach …
CN: That did not want to make me want to buy anything.
KW: Come on, Casey, get it together. Get it together.
CN: Oh my goodness.
We’re back with Kurt Wagner and Casey Newton in our last section. Casey works for The Verge and Kurt works for Recode, and they were both covering the Facebook hearings on Capitol Hill, both in the House and the Senate. Now Kurt, you wrote that one of the themes that emerged from his testimony this week is that Facebook doesn’t have much competition, which we talked about previously. Who do you think is competition? Do you imagine regulation headed its way?
KW: I do think regulation is coming, I think Facebook knows it’s coming to, which is why they’re being so open in saying, “We think regulation can be good, as long as it’s the right regulation.” I’m not fully convinced that, from what we’ve heard over the last two days, that there’s a lot of consensus among Democrats and Republicans on what that regulation will actually look like, right?
KW: I do think something’s going to happen. In terms of who their biggest competitor is, I know Google is not a social network, but they’re really the only other digital place where people spend money online. You can’t really have a conversation without talking about Google, because as a business it’s really Facebook’s only competition right now, besides traditional TV networks, for example. I don’t think Twitter is a competitor, I think Snapchat is a competitor on a very specific age group and demographic for Facebook, but not overall. That’s part of the problem.
Yeah, there’s a lot of …
KW: You can’t easily pick one specific competitor, there’s a lot of smaller ones.
Do you have anything, Casey, to add to that?
CN: I mean, I would toss in Amazon and Apple, too. Amazon is ramping up the advertising on the platform, and both Apple and Amazon make hardware, and Facebook is moving into hardware, although they’ve had to delay most of it …
And they’ve had a bad history.
CN: Because who wants a Facebook listening device in their house right now?
CN: Yeah. I think Kurt is right, there’s no one-to-one replacement for Facebook. There are lots of companies that compete with it in various ways.
And then, your prediction on the paid ad-free version. Is there going to be one?
CN: I don’t think we’ll see it this year, and my guess would be Facebook wants to see how this current plays out over the next six months or so. If this is something that members of Congress are still talking about in six months, then they might fast-track it. If they don’t, I think they’ll try to get away with this simple ad model for as long as they can.
Kurt, what about the idea that Facebook could still offer an ad-supported product but without targeting ads towards some or all of its users? Does that seem like a non-starter, too?
KW: It seems like a bad idea, or certainly to Facebook it’s a terrible idea, because they’re saying, “Hey, all the ads are going to be irrelevant, you’re just going to get a bunch of random ads.” Probably like you do on TV, where half the stuff doesn’t relate to your life in any way.
The other thing is, they’re going to have to charge a lot of money, because people are going to be spamming a wider audience because they don’t know who they are reaching. Instead of going after a very small, select, specific group, they’re gonna do the blast-it-to-everybody model. Ads will be A) more expensive, and B) they won’t be as relevant to people. That doesn’t sound super great for Facebook, but honestly it doesn’t sound super great as a Facebook user, either.
We’ve heard on a couple of occasions that Facebook sometimes learns about privacy violations for the first time in the press. Should we be concerned by that?
KW: We are important.
No, no, I think they were just stupid, that would be my thing. What do you think, Kurt and Casey?
KW: I’ll say just real quick, I think there’s some validity to that, in the sense that there are people who abuse stuff, are not necessarily going to go tell the company, but that trickles to journalists from time to time. At the same time, it seems very clear Facebook had its head in the sand during this whole process, so I’m not going to try to defend them.
Yeah, bad management. What do you think? I think there’s been a lot of showing of not-so-perfect management here of this giant platform. Casey, what do you think about them not knowing a lot of these things?
CN: Yeah, I think there have been a number of cases where journalists have brought things to Facebook’s attention that it seems that Facebook should have detected on its own. I will say that they have tens of thousands of moderators who are moderating stuff every day, and they’re not putting out press releases every time they take something down. The things that we hear about are the things that journalists discover. I want to acknowledge that difference.
It’s very …
CN: At the same time, ProPublica alone uncovered abuse after abuse after abuse that their advertising platform … By reading the first two ProPublica stories, you probably could’ve guessed what the next six were going to be, and no one at Facebook did.
Yeah, they’re very slow on the uptake, I think. I think one of the things throughout this whole thing is that they’re not quite the perfect managers they put themselves out to be. You know what I mean?
They have this sort of sterling reputation in Silicon Valley, and I think it’s probably not as good … They’re not paying attention as they should.
All right, Lana Cher asks, “Not too embarrassed to ask, but where’s the talk about compensation? No. 1, compensation to those who had their data stolen. No. 2, substantial financial penalties to Facebook. No. 3, effective regulations/laws to put in place to prevent further data thefts across any current, emerging platforms. No. 4, clear language options for users.” Lana is very upset.
CN: Well, I’m glad that she asked, because something that we have not talked about today is, I’m a victim of the Cambridge Analytica breach.
Oh you are? I’m not. Why, tell us, tell me.
CN: One of my idiot friends, apparently, took this survey and shared my data, including my “Likes” and my posts, and maybe even my Facebook messages.
Kurt, were you affected? I was not. I never use Facebook.
KW: I was also a part of the breach, yeah, yeah. Honestly, I think, Casey, you and I should look at what friends we have in common.
KW: It seems a little coincidental we’re both part of it.
I’d say so.
KW: Seems like a Lauren Goode kind of situation for me.
I think it’s Lauren Goode, I think it’s Lauren, it’s totally Lauren.
KW: Maybe she’s the threat.
Do you think Facebook should pay in something to their users?
CN: Yeah, I think they should pay, or Mark should do something cute like agree to record your outgoing voicemail message. Just something to let people know that they care.
They don’t care, Casey.
CN: Oh man.
All right, Robert C has a more general question: “How long does Facebook store their information? I suggest there should be a time log, time period.” That was asked quite a bit, like how long do they store it?
CN: I love that idea, the idea that Facebook just keeps everything it has on everybody forever I think is bad. There’s an idea out there that data is like toxic waste because it degrades over time and becomes more and more damaging, which is why Mark Zuckerberg secretly deleted all of his Facebook messages. Yeah, Facebook absolutely should be deleting our data on a regular basis.
With input by us, I think.
CN: Yeah, yeah, sure.
All right. Yeah, yeah, sure, just do it. Tyson Jackson tweets — Kurt, why don’t you answer this: “How is this Cambridge Analytica Facebook info leak a bigger deal than the Equifax leak? Equifax affected more Americans with so much more sensitive data.” I think I snarked him back, I’m like, “Who says that it was?” I don’t think it was bigger or smaller. Maybe you guys have an opinion, Kurt?
KW: I think people understand what Facebook is, and they know what Facebook is, and they probably don’t know much about Equifax. Mark Zuckerberg and Facebook are a very, very easy target. They’re someone that comes across as a friendly service, where you use it to connect with your friends and share your birthday and stay in touch with your college roommate, or whatever. It feels like more of a betrayal. I feel like the Equifax stuff is just … It feels so wonky to begin with that no one really pays attention.
Essentially you’re screwed no matter what, correct? Casey?
CN: Yeah, but also, Equifax doesn’t pretend like it’s doing any good for humanity, right?
Yeah, oh I know, yeah.
CN: Equifax is just collecting a bunch of our data without our permission and profiting from it, whereas Facebook talks endlessly about connecting the world and building the social infrastructure for the future of human interaction.
CN: Yeah, yeah, yeah. Of course people are going to hold it to a higher standard.
And I agree, they try to hold themselves to a higher standard, but they don’t reach it very often.
All right, Roxanne Darling wrote, “I’d like a definitive public information campaign on the false sense on we don’t sell your data, because we collect as much of it and sell access to it in every way, shape, and form. Are customers willing to pay for it?” Mark did try, kept focus on this, he was obsessive almost. “We don’t sell it, we don’t sell it.” It was like, but yeah but you do. What do you both think? Why don’t we start with you, Casey.
CN: Yeah, I think it’s … Look, Facebook profits from our data, but they don’t sell it. I’m a journalist, and I actually do believe that you should be careful with your words, and you should use words that are precise, and that’s a point that I’ll grant Facebook. Okay, you don’t actually sell our data to advertisers, actually your business model is much better because you’re essentially renting out not our data but our attention. Yes, we should be precise with our language, but the truth is, no, Facebook does not sell our data.
Yeah, but it profits from it.
CN: It doesn’t mean what they’re doing is necessarily better, but let’s just pick our terms right.
KW: No, I agree 100 percent. I actually just wrote a story this morning that tried to answer a lot of those types of questions that I think people get wrong. Does Facebook sell your data? The answer’s no, and it has been forever. It’s a common misconception, it’s annoying we spent so much of the last two days actually answering that question over and over.
Mark was particularly interested in it.
KW: It’s one of those things, as Casey pointed out at the very beginning, you could’ve answered that yourself with a quick Google search many years ago.
He wanted to stress that over and over again. Here’s what I would say: “Facebook does not sell your data, they greedily hoard it and then take advantage of it.” How’s that? Is that better? Think Elliot will like that?
CN: That’s actually much more accurate.
Yeah, okay, good. They’re greedy information hoarders, they are not salespeople, all right? You’re welcome, Elliot Schrage.
I’m going to get a testy note from him. I don’t know if you know it, he thinks I’m emotional.
Anyway, Jeff Bordin, last question: “What is the realistic outcome if the FTC finds Facebook violated the 2011 consent decree? I’ve seen articles talk about a fine in the trillions of dollars in theory, but it feels next-level bonkers. Just wanted to hear Kara Swisher say next-level bonkers.” There you go. First Kurt, then Casey.
KW: I was hoping you were going to make Casey go first. I don’t know, I don’t know enough about how the FTC goes about analyzing and punishing people for this. I think you could make a valid argument that Facebook did not follow the decree that it signed in 2011, as we did hear from a handful of the politicians over the last couple of days. I think that’s fair. I think it’d be hard for Facebook to argue that it followed that by the letter. At the same time, I don’t know if there is enough there for the FTC to come in and say we’re going to charge you X amount of dollars for all of these 87 million people.
This is one scenario … We’re probably eventually going to find out that there was a whole lot of other people that were taking data that we didn’t know about. It doesn’t feel sustainable that Facebook’s going to be penalized financially into oblivion. At the same time, the letter of the law, you could make that argument.
I thought them not saying it, being non-transparent for so long, was really appalling. Casey, what do you think about the FTC?
CN: Yeah, I’m not an FTC expert either, but my understanding of the decree is that Facebook was going to be held responsible. Not just enforcing basic privacy standards, but actually trying to identify new threats and respond to them. This does seem like a place where …
That’s an app.
CN: Yeah, it seems like this is the place where they fell down on the job, and assuming what I’ve just described is true, then yes it does seem like some sort of fine would be appropriate. Like Kurt, I don’t think it’s going to break the bank.
Yeah, and just so you know, Elliot Schrage is calling me right now. He knows I’m talking about him.
CN: Oh my God, tell him … See if he wants to join.
KW: Yeah, bring him on.
No, I’m not going to, no, I think not.
KW: What does he want to ask?
I don’t know. Oh my God. He’s listening, they’re listening, Facebook’s listening on our phones. We said Elliot Schrage and he calls. Oh my God, Elliot, I’m sorry you’re on this pod, but you just called. I’m going to get lectured by him and I’m not really looking forward to that.
Okay, last thing: What was the most annoying phrase of the entire thing? To me, it was, “My team will get back to you.”
KW: Yeah, yeah you stole mine, that was a good one. He said that, what, two dozens times?
Two dozen times, yeah.
KW: Three dozen times, I don’t know, a lot.
CN: For me it was, “We’re taking a broader view of our responsibility.” Which is a fine thing to say, but yeah, after the hundredth time it was wearing a little thin.
Yeah, yeah, and do you think that one of the things one of the congresswomen … Also, the “I’m sorry.” One of the congresswomen listed all his “I’m sorrys” and read them, and that was fantastic. What do you think the next “I’m sorry” from Mark Zuckerberg is? This we’ll finish on.
CN: Probably, “I’m sorry that our home speaker was secretly recording hours worth of your conversations.”
What about you, Kurt?
KW: Oh man, that’s a really good one. I’m going to go with something about WhatsApp and advertising, because they promised … WhatsApp is like, “Oh we’re never going to do ads, it’s never going to happen.” My guess is it’s going to happen. It might not be an “I’m sorry” from Mark, it’ll be an “I’m sorry” from Jan Koum, but it’ll still be …
KW: “We didn’t treat WhatsApp the way we promised you we were going to.” Just a hunch.
Yeah, and anybody’s job that risked it all that was raised, I think it was insane to raise it but anybody’s job at risk.
CN: Well look, if not one person gets fired out of this whole thing, doesn’t that seem weird? I actually think it’s like …
It seems like the banking crisis, but go ahead.
KW: What kind of pros would …
CN: Yeah, yeah, I don’t know. I think that it’s not a great look for a journalist to call for peoples’ heads all the time, but at the same time …
Really? I’m good with it.
CN: Well, it does seem like there should be some sort of holding of accountability here.
Yes, yes. He was asked that, and he did not want to fire anybody, it looked like.
CN: Right, and the implication of that is no one deserves to be fired over this. That’s where I think I take issue.
Yeah, I would say … and I think the board also has something, should be looked upon for not monitoring. Not monitoring is my big issue.
Anyway, thank you so much, both of you, my team will get back to you when this appears. That would be Eric, essentially, and we will see what happens going forward. I feel like nothing’s going to happen, I assume you guys do, too. Nothing big is going to happen, but you think this is over for now?
CN: I’ll take a different view. I think something’s going to happen. I don’t know what it is, but if there’s one thing we’ve seen over the past six months, it’s that things keep happening. Yes, I think things are going to keep happening, yeah.
All right, all right, on that note, thank you so much, and Kurt thank you for being in D.C. and covering and doing such a good job for us. Go out and get that drink.
KW: Of course.
And Casey, I will see you soon.
CN: All right, see you soon.
Thank you so much, both of you.
KW: Thanks guys, later.
CN: Yeah, bye.