The Facebook Backlash Has Begun

facebook-logo-squareFacebook has faced regular heat and criticism of its privacy policies since the beginning. However since the Facebook S-1 and the recognition that its IPO will make many employees into millionaires and billionaires, there’s a new quality and intensity to the criticism.

In the past week, for example, the New York Times as run multiple articles that are somewhat or mostly critical of Facebook. Among them are the following:

It’s not just The Times, many other news outlets and tech blogs are playing up the “contrarian” angle or arguing that Facebook may not deliver for investors. In that category is Silicon Alley Insider’s Facebook Revenues Are Decelerating. And then there are the general “is Facebook really worth $100 billion?” articles, such as the WSJ’s Facebook’s $100 Billion Question.

Some of this is just analysis coverage in the wake of concrete information revealed in the Facebook IPO filing documents. But there’s something more subtle here too: a kind of resentment that Facebook is creating so much wealth for a relatively small group of lucky insiders off millions of people’s pictures, posts and “Likes.” In much of the coverage there’s an explicit or underlying critique that Facebook is exploiting users’ interests to generate ad revenues — and that it will need to do more of it in order to justify its valuation.

Internationally there also seems to be some “resentment” of yet another big American company dominating the internet in their countries. While its too simplistic to say that the new European privacy rules are guided by this, one gets the sense that there wouldn’t be quite as much “intensity” around the privacy debate if Facebook or Google were French companies for example.

I believe that regulators, governments and journalists around the world will be less tolerant of Facebook the post-IPO $100 billion internet giant vs. Facebook the fast-growing internet startup. This is the same thing that happened to Google. When the money came, some of the popular “good will” left.

While Google for several years after its IPO still thought of itself as a benevolent internet upstart, more and more people saw the company as a self-interested juggernaut and “homewrecker.” That’s in part why Google is facing so much pushback and so many investigations around the world.

Facebook can expect the same kind of “resistance” going forward. The company can learn from Google’s PR mistakes (and perceived arrogance) and act with humility and transparency in its dealings with users and governments. This is where the more diplomatic Sheryl Sandberg does a better job than Mark Zuckerberg. (Sandberg will be a politician or public official at some point in the future.)

There is now a category of people out there — call them the ”schadenfreude class” — who are rooting for Facebook to underperform or fail in some way. The company must be mindful of this and the perception it’s “taking advantage” of its users and their information.

The Facebook “backlash” has begun.

Related Topics: Channel: Industry | Facebook | Facebook: Business Issues | Features & Analysis | Top News

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About The Author: is a Contributing Editor at Search Engine Land. He writes a personal blog Screenwerk, about SoLoMo issues and connecting the dots between online and offline. He also posts at Internet2Go, which is focused on the mobile Internet. Follow him @gsterling.

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  • Jelly Jim

    Sour grapes, pure and simple. Cue bono, in the case of the NYT. What’s their motive, or are they purely being snobbish participatory forms of media?

    It’s quite simple – Facebook is a product. It gives something in return for something. As it stands, millions of people value what they receive from it more than what it takes from them (their data, and let’s not go down the faux shock route of pretending not to know they don’t use the information we provide them with). Don’t like it, don’t use it.

  • Jeffrey

    NYT seems to be making a habit of biting the hands that feed it.

  • http://www.shaadhamid.com/ Shaad Hamid

    Pardon my ignorance, but don’t the NYT make money through advertising too?

  • http://www.facebook.com/profile.php?id=640237382 John Anzinger

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