Facebook Sets Aside $3 Billion Ahead of FTC Fine Over Privacy Violations

Facebook isn’t typically described in a positive way when it comes to security or privacy. And the company has taken some big hits recently. In today’s quarterly earnings report, the social network has revealed it’s preparing for a huge fine for violations related to privacy.

Facebook today officially announced its latest quarterly earnings for the year 2019. According to Facebook’s data, it had a revenue of $15.08 billion for the quarter. However, in anticipation for an FTC fine for privacy violations, it has set aside a whopping $3 billion to cover the cost. Facebook is anticipating that the fine from the FTC will be between $3 billion and $5 billion.

Facebook notes that it’s possible the fine from FTC isn’t that high, and notes that the matter is still “unresolved” for now. However, it’s anticipating the huge amount and has set aside the money just in case.

“We estimate that the range of loss in this matter is $3.0 billion to $5.0 billion,” Facebook said in a statement. “The matter remains unresolved, and there can be no assurance as to the timing or the terms of any final outcome.”

Facebook says that things are going to change moving forward. As reported by CNBC, the CEO of the social network, Mark Zuckerberg, says that shifting to privacy will be a “central focus for the company” over the next five years “or longer”. Zuckerberg added that he doesn’t see the pivot to privacy to “be a real contributor to Facebook’s business” over the next couple of years.

Building from that, Facebook will be also putting a bigger focus on marketplace and payment features. The Facebook Marketplace is already a popular way for people to sell goods online. And Instagram is a burgeoning marketplace in its own right, thanks to so many influencers out there hawking products on a regular basis. With that in motion, Zuckerberg says that more companies will be handing over money for advertising on Facebook and Instagram.

Our Take

These could all be empty words from Zuckerberg. Unless something actually changes with the social network, and there isn’t such a huge focus on handing out user information, none of what Zuckerberg has planned, or says what’s planned, will actually matter. Here’s hoping it turns into something worthwhile, though.

[via CNBC; Facebook]