How Mark Zuckerberg Lost $9 Billion In A Single Day & Why Everyone's Suddenly Hating Facebook

Just over a single day, Mark Zuckerberg had over $9 billion of his personal wealth wiped off. Gone. Just like that. It's mainly because Facebook's stock price is down over ten percent since last Friday, the biggest drop it has faced since going public.

If you're wondering why Zuckerberg and Facebook are losing money, it's because the social media website which has over 2 billion active users around the world is facing its greatest existential crisis yet.

Last week, the entirety of the United States was in an uproar thanks to two names; Facebook and Cambridge Analytica. You may have also come across the #DeleteFacebook posts on Twitter or elsewhere, too.

Well, that's because Facebook's caught at the centre of a controversy that began with a hidden data breach (yes, it was allegedly hacked several years ago) and the role its social platform played during the 2016 US Presidential Election. Also under scrutiny is how Facebook allows third-party developers to harvest user data, raising important questions on data privacy in an increasingly digital world.

From the beginning...

In 2014, voter-profiling company Cambridge Analytica had just received a $15 million financial investment from a Republican backer, and were tasked with unraveling the personalities of voters and influencing them to support Ted Cruz¡¯s White House run in 2016. The problem was, it didn¡¯t have the data to feed into its fancy tools. So it allegedly yanked the data from Facebook.

The firm reportedly harvested data from the Facebook profiles of more than 50 million users, without their consent, using sketchy online surveys and a personality quiz. Volunteers took these surveys, and had to link to Facebook before they could see the results. The problem is, it wasn¡¯t just their Facebook data the company was recording, it was also gleaning information from each of their friends on the network.

You¡¯ll also realise, nowhere have we said the firm ¡°stole¡± user data. Well, that¡¯s because Facebook¡¯s policies are incredibly porous, and Cambridge Analytica, it could be argued, was not breaking any rules. Whatever data you put on Facebook for your friend to see, any other developer that links to Facebook can also see -- to some degree.

Cambridge Analytica¡¯s main purpose was identifying voter¡¯s and how to influence them to vote one way or the other. The firm¡¯s CEO Alexander Nix called it OCEAN ¡ª the five personality trait measurements of Openness, Conscientiousness, Extroversion, Agreeableness, and Neuroticism. Studies have shown that, from just analysing a person¡¯s likes, it¡¯s possible to predict a person¡¯s race with 95 percent accuracy, and political affiliation with 85 percent accuracy.

Experts still disagree on how this could ever be used to sway a voter but Cambridge Analytica has its own claims. They were attempting to control voters with ¡°microtargeting,¡± basically making personality profiles for voters fitting certain OCEAN criteria and then feeding them tailor-made content. Neurotic voters can be influenced using ¡°rational and fear-based¡± arguments Nix has said, while introverted voters are more likely to respond to ¡°tradition and habits and family and community.¡±

Then, when Ted Cruz dropped out of the running in 2016, Donald Trump¡¯s campaign hired Cambridge Analytica, allegedly paying them millions. It¡¯s not really easy to say how well the firm helped, but it¡¯s clear that Trump¡¯s social media campaign was highly effective. Pro-Trump messages found their strength in automated bots, conservative trolls, and anti-Hillary Clinton propaganda. It didn¡¯t even matter whether that propaganda was entirely lies, because the messages were being targeted at audiences that would best receive them. And with constant analysis of ads and how people responded to them, Cambridge got even more data points to further improve their voter profiles.

ALSO READ: Why The Co-Founder Of Whatsapp Is Asking Everyone To Delete Their Facebook Account Right Now

Beyond the US, having a global impact...

The thing is, the entire affair caught the attention of the Information Commissioner¡¯s Office in Britain, after reports emerged that Cambridge Analytica and its psycho-profiling were also influential in the pro-Brexit campaign. The privacy watchdog felt it was a risk to voters¡¯ rights and began looking deeper into the affair. At the time, the stories also caught Facebook¡¯s attention, who supposedly demanded the data be deleted.

It¡¯s still unclear if it ever was, but one sure thing is that Cambridge Analytica was never punished. Facebook, apparently, did not see their actions as ethically wrong. Most importantly, the social network apparently didn¡¯t alert its users that this was happening.

Then last week, after the story raised its head again and started to gather steam, four years after the original breach of ethics took place allegedly, Facebook finally decided to suspend Cambridge Analytica from its platform pending further information over the misuse of data.

Even better? Facebook also suspended Christopher Wylie from the platform, the whistleblower that provided evidence of wrongdoing by both Facebook and Cambridge.

Current fallout...

Of course, people aren¡¯t happy about any of this. Aside from both parties now being the subject of investigations on both sides of the Atlantic, it¡¯s also caused political leaders to sit up and take notice, underlining the need for better privacy laws in the digital sphere.

Obviously, with so much bad news surrounding the platform, Facebook¡¯s stock took its biggest beating from an all time high it set on just February 1. The crash caused CEO Mark Zuckerberg to lose about $9 billion in a single day, pushing him lower down from fourth-richest man in the world to fifth or sixth.

Most importantly though, it may have caused a lot of people to lose their faith in the company and, at this point, Facebook¡¯s immediate future is all about answering some very tough questions about the way it does business.