Brief:
- Two senior executives at Facebook announced they were leaving the company amid disagreements over the company's new privacy-focused direction, according to The New York Times. Chief product officer Chris Cox and Chris Daniels, the unit head of Facebook’s WhatsApp messaging platform, are leaving the company, according to a blog post by Zuckerberg.
- As part of the new direction, Zuckerberg asserted more control over the company and its products, leaving executives fearful of losing autonomy and power, according to the Times. Rolling Instagram, WhatsApp and Messenger into one platform will be a significant undertaking, and frustration has been mounting for months throughout the company. Cox had been frustrated since taking over as chief product officer last year, overseeing Facebook, Instagram, WhatsApp and Messenger, and was reportedly not onboard with the company's new direction.
- Facebook 10 months ago promoted Cox to oversee Instagram, WhatsApp and Facebook, while Daniels had run Facebook's affordable internet initiative and took over WhatsApp less than a year ago, when WhatsApp cofounder Jan Koum left. On Thursday, Facebook promoted Fidji Simo to oversee the Facebook app and Will Cathcart will lead WhatsApp. They join current Instagram head Adam Mosseri in reporting directly to Zuckerberg.
Insight:
Zuckerberg's push to pivot Facebook from public sharing to private messaging in response to a litany of high-profile privacy scandals has tarnished its brand is not expected to be an easy one. The company’s latest personnel changes show that not everyone is onboard with what could be fundamental changes to Facebook and its various platforms.
The social network has billions of users worldwide and sweeps up vast amounts of their private data to provide its advertisers with unrivaled targeting at a grand scale. What the privacy-focused vision for social networking may mean for mobile marketing is unclear, but there could be a negative impact on the company's ad revenue, which has surged 38% to $55 billion amid Stories ad growth.
Facebook also faces stricter regulation such as the proposed Consumer Data Protection Act that may become law this year. California and the European Union already have privacy laws in effect. Some advertisers have quit Facebook, including one who chided its "despicable business model" of invading people's privacy, CNBC reported. Data sharing has created numerous legal headaches for Facebook, including a criminal investigation that has entangled smartphone makers.
WeChat, the most popular messaging app in China, potentially offers a window into what Facebook could become. Not only does WeChat provide messaging, the app is like a miniature operating system on Android phones that supports a range of service like making payments, ordering food, hailing cars and booking hotel rooms. However, WeChat doesn't encrypt its messaging service, leaving the platform open to surveillance by the Chinese government and worrying some users.
