Facebook is facing a record-setting penalty of about $5 billion from the Federal Trade Commission — but for the tech giant, that’s only about as much as the revenue it generates in a month.
What could be more damaging to Facebook than the monetary costs of the settlement is the degree to which the government will get oversight of its business.
The New York Times reports that under the terms of the settlement, Facebook will be able to continue sharing data with third parties, but that there will be more oversight into how it handles user data.
Depending on how that oversight shakes up, it could cause headaches for Facebook, even long after that $5 billion bill is paid.
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Facebook is facing a penalty of about $5 billion from the Federal Trade Commission (FTC) for violating a privacy consent degree set back in 2011.
The multi-billion-dollar penalty — which was first reported by the Wall Street Journal on Friday — is poised to be the largest of its kind against a tech company, eclipsing a $22 million settlement with Google. For Facebook, though, it looks to be an easy bill to pay, given the roughly $45 billion cash it has on hand.
Five billion dollars is about 9% of Facebook’s total revenue for 2018, which notched in at $55.83 billion. For a more recent figure, to put it into context, Facebook did about $15 billion in revenue in the first three months of 2019, averaging out to about $5 billion a month.
Indeed, earlier this year, Facebook announced that it had already set aside $3 billion to deal with any potential fine from the FTC, which it had already estimated would be around $5 billion.
Ex-Facebooker to me just now: “that’s …read more
Source:: Business Insider