Cook v Zuckerberg spat shows Silicon Valley is polarised over privacy

3 Apr 2018

Facebook logo and padlock. Image: Ink Drop/Shutterstock

Facebook’s Zuckerberg hits back at Apple’s Cook.

The Cambridge Analytica affair has polarised Silicon Valley, with Apple and Facebook in firm opposition.

Facebook CEO Mark Zuckerberg has hit back at comments made by Tim Cook last week, describing the Apple CEO’s views as “extremely glib”.

‘I find that argument, that if you’re not paying that somehow we can’t care about you, to be extremely glib and not at all aligned with the truth’

Future Human

A bitter war of words between two very different tech giants – one a veritable legend in the computer industry for the past 30 or more years, the other a scion of Silicon Valley’s steep rise from the ashes of the dot-com crash almost two decades ago – is unfolding.

It reveals two very different cultures: one tempered perhaps by philosophy, wisdom and experience; the other that signals the grab-data-at-any-cost attitude (check out the ugly-truth memo story) that has typified the rise of unicorns over the past decade or so, ignoring warnings about recklessness around data, and showing a moral blind side when it comes to diversity.

The distinction for Apple is that it sells products to people, unlike Facebook, which turns people into products to sell more ads.

Apple doesn’t want your data, it wants to sell you devices that are not cheap; Facebook’s engine is powered by people’s willingness to open up their lives to algorithms, and the flaw in this has been exposed by the tawdry Cambridge Analytica affair. In many ways, this is the story of our time.

The affair wiped around $70bn off Facebook’s share value in 10 days, after the story broke more than a fortnight ago.

And any criticism at this point from Apple – which appears to be on top of its privacy responsibilities – must feel like a stinging rebuke for Zuckerberg, who must be struggling to find a way to untangle his company and find a way to the moral high ground.

What is at stake, privacy or business models?

During an interview with Kara Swisher at the Recode-MSNBC Revolution event last week, Cook said: “The truth is, we could make a ton of money if we monetised our customer, if our customer was our product. We’ve elected not to do that.”

In an interview with Vanity Fair, however, Zuckerberg appears to be fighting back, dismissing Cook’s point. Or, perhaps, missing Cook’s point.

“You know, I find that argument, that if you’re not paying that somehow we can’t care about you, to be extremely glib and not at all aligned with the truth,” Zuckerberg retorted.

“The reality here is that if you want to build a service that helps connect everyone in the world, then there are a lot of people who can’t afford to pay. And therefore, as with a lot of media, having an advertising-supported model is the only rational model that can support building this service to reach people.

“That doesn’t mean that we’re not primarily focused on serving people. I think, probably to the dissatisfaction of our sales team here, I make all of our decisions based on what’s going to matter to our community, and focus much less on the advertising side of the business.

“But if you want to build a service which is not just serving rich people, then you need to have something that people can afford. I thought Jeff Bezos had an excellent saying on this in one of his Kindle launches a number of years back. He said: ‘There are companies that work hard to charge you more, and there are companies that work hard to charge you less.’ And, at Facebook, we are squarely in the camp of the companies that work hard to charge you less and provide a free service that everyone can use.

“I don’t think at all that that means that we don’t care about people. To the contrary, I think it’s important that we don’t all get Stockholm syndrome and let the companies that work hard to charge you more convince you that they actually care more about you. Because that sounds ridiculous to me.”

If anything, Zuckerberg’s retort shows that Silicon Valley isn’t just at polar opposites over privacy, it is polarised over charging models.

Zuckerberg is right, it costs money to build things people want.

In traditional media – which has had its business model swallowed up by social media – that business model was a delicate balance of subscriptions and advertising that evolved over 200 years, and both of these have been decimated within a generation thanks to the internet.

But firewalls are returning, privacy is being valued and people are increasingly being educated about the value of their data.

GDPR will teach some rigorous lessons as infrastructure, its protection and people’s own sense of the value of their data evolves.

My maxim on privacy? There is no such thing as a free lunch. If it is free, you are the product.

Facebook logo and padlock. Image: Ink Drop/Shutterstock

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years