Facebook is a worldwide social media platform that connects people socially and business-wise. A lot of upcoming entrepreneurs depend on Facebook for advertisements. Recently, the firm has been undergoing antitrust scrutiny. The committee in charge of the investigation process challenged Mark Zuckerberg alongside other CEOs like Jeff Bezos. The big 4 tech firms have been involved in unethical business practices involving competition.
The other issues that Facebook has been facing are hate speeches and misinformation. This resulted in the start of enormous companies pulling off their advertisement money from Facebook. Different organizations came together and ordered the firm to look into the matter. However, Facebook did not take the matter seriously causing the meeting between the CEO and the representatives of these organizations to fail.
They criticized Facebook for not taking action against President Donald Trump’s controversial posts. A civil rights group gave Facebook some recommendations to amend their policies if they want the big fish companies back. Some of these recommendations were that Facebook was to thoroughly review its company’s rules. Besides, the company was to remove any groups or associations associated with hate speech and misinformation.
Facebook Says It’s Still Doing Fine Despite The Crisis
Early this month, over 950 advertisers got involved in participating in advertising for a boycott over the way the firm handles issues. Despite, this ad boycott, the firm reports that its 2020 earnings reports show that it is doing okay in the advertising hustle. During the last quarter, the company made over $18 billion in the advertisement income. For this month, it did not give the exact figures for its earnings.
Facebook says:
“We expect our full quarter year-over-year ad revenue growth rate for the 3rd quarter of 2020 will be roughly similar to this July performance.”
Reasons for Doing Fine
In business, the major segment of an enterprise matter. It is what will hold a company when things go wrong. Facebook is an example of such a firm. Its major advertisers are small businesses. So, they are not badly off even if the bigger companies have pulled out their advertisement dollars.
Criticizers only saw the smaller picture of the situation. They did not look at what’s on the bigger picture.
Mark Zuckerberg says:
“Some also seem to wrongly assume that our business is dependent on a few large advertisers. The biggest part of our business is serving small businesses.”
Facebook has over 8.5 million advertisers and the largest percentage comprises small and medium-sized businesses.
The Investors and the Regulators Views
The investors in the firm say that they are progressing well with the situation. The regulators say that if the committee affects the company, then everyone else depending on it will be victims. This is mostly with small businesses.
It will be so bad if small businesses find it a challenge to advertise their products amid this pandemic. The committee should spare Facebook since it’s the head of support of the SMBs and when the head is not there, the body will not function.
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