Facebook shares has taken a sharp fall one day after
documents incriminating the tech giant were leaked.
As the stock markets opened today, the company's shares
opened around 2.5 per cent down, wiping about $9.5billion out of the company's
$379billion value.
This comes one day after a document leak which shows that
Facebook used its platform to cripple rivals, aggressively pursued competitors,
and leverage developers for advertising money, setting up conflicts with
regulators and politicians around the globe.
The leaked documents revealed that:
Facebook planned to grant companies access to user data
based on how much advertising they bought, and threatened to cut off access for
firms paying under a certain amount.
Facebook programmed its android app to see users call and
text records in which it admitted was a "pretty high-risk thing to do from
a PR perspective".
Mr Zuckerberg said he was "sceptical" that apps
with access Facebook users' data would pass data on, as then happened in the
Cambridge Analytica scandal.
Facebook used Onavo app it acquired to spy on users' phone
usage, apparently without their knowledge, to identify competitors such as
Whatsapp to buy out.
Following the document leak, stock investment firm Stiefel
downgraded Facebook's shares from "buy" to "hold" ahead of
markets opening in New York, saying the company has made "too many
adversaries" for its business to thrive.
Stiefel told CNBC:
Facebook’s management team has created too many adversaries
-- politicians/ regulators, tech leaders, consumers, and employees -- to not
experience long-term negative ramifications on its business.
One key issue is how Facebook took "aggressive
positions" against rivals and denied key competitors such as Vine access
to its data, which shut down shortly after. Facebook CEO Mark Zuckerberg
personally approved a decision to block Twitter's app Vine from accessing
users' Facebook friends lists.
The papers leaked by British MP Damian Collins also showed
that Facebook signed deals to give companies such as Netflix and AirBnB special
access to user dater and spied on Android users' calls and texts.
Facebook strongly denied ever selling user data and insisted
it only granted these companies "short term extensions" to preserve
user experience.
In the midst of the fallout, Zuckerberg was forced to defend
himself on Wednesday night, saying in a lengthy Facebook post that the company
"never sold anyone's data".
The EU is aggressively cracking down on tech monopolies and
recently fined Google $5billion for breaching its competition laws. While the
EU has so far been silent on the Facebook leak, regulators are certain to be
aware of it and will likely investigate whether the social media giant broke
any laws, Daily Mail reports.
Politicians from eight world governments investigating the
spread of fake news, led by British MP Damian Collins who leaked the papers,
will also pile pressure on Facebook to disclose exactly how it monetises user
data.
Facebook
Following the document leak, on Wednesday night, a former
Facebook staff described a "toxic and hostile" atmosphere at the
company. One former senior employee told Buzzfeed News that workers are
desperate for a change of leadership. Another said staff fear being scolded by
furious bosses who are "spouting full-blown anti-media rhetoric, saying
that the press is ganging up on Facebook."
