Facebook founder and CEO Mark Zuckerberg is testifying in front of Congress this week. To accompany the testimony, Select All is publishing transcripts of interviews with four ex-Facebook employees and one former investor, conducted as part of a wider project on the crisis within the tech industry that will be published later this week. These interviews include:
• Former Facebook manager Sandy Parakilas on privacy, addiction, and why Facebook must “dramatically” change its business model.
• Early Facebook investor Roger McNamee on Facebook propaganda, early warning signs, and why outrage is so addictive.
• Former Facebook designer Soleio Cuervo on Facebook’s commitment to users, what the media gets wrong, and why regulation is unnecessary.
• Former Zuckerberg speechwriter Kate Losse on how the Facebook founder thinks and what is hardest for him to wrap his mind around.
This interview is with Antonio Garcia Martinez, a product manager on the Facebook Ads team between 2011 and 2012. He is the author of Chaos Monkeys: Obscene Fortune and Random Failure in Silicon Valley Kindle.
There’s an assumption that what Facebook does for advertisers is hugely influential. But on the other hand, as Zuckerberg said right after the election, it was a pretty crazy idea that fake news could influence an election in a meaningful way. Where do you think that dissonance kind of came from? As somebody who worked on the ad side.
So you’re referring to his somewhat jaw-dropping initial post after the election on November 11th or 12th or whatever it was, right? The one where he basically dismissed the claim that Facebook could have impacted the election. I mean, that was kind of a crazy claim. I also was clearly astonished when I read it. Until literally a few days before, this entire ad sales team at Facebook was literally telling every politician with any budget that Facebook can actually hand them the election. It is incredibly disingenuous and strange for an exec to get up and say that there’s no way Facebook could have potentially impacted the election.
Two or three days later someone sat him down, and he very quickly backpedaled. I mean, that I think is the combination of a few factors. At the exec level, it might just be a function of the fact that he doesn’t know too much about ads, and when I say that it sounds horrible, but I don’t mean it in a necessarily critical way. Zuck has famously never been very interested in either money or revenue of the company. Obviously he understands that it’s a necessary evil, but it’s the sort of thing that he just outsources to Sheryl and whatever lieutenants that are taking care of the ad system.
He’s a micromanager, and I never even saw him once in the ads area micromanaging anything. He just doesn’t care. I’m sure he knows but not in a top-of-mind sort of way that there’s an ad political sales force numbering in the hundreds and a huge D.C. office and that there’s this entire effort actually to make politics more sensational. Look, it’s probably not something that he thought of when he sat down in a postelection moment of panic or emotion or whatever to write about, right? So I think some of it’s just that. Some of it’s … people always approach this with this kind of overweening techno-optimism, right?
They only ever see the positive side of the technologies they create. I mean, part of that is because we really, at heart, really are just such optimists, they can’t imagine negative scenarios, they don’t have some kind of, sort of tragic history.
At what moment would you say that blindness actually became a really big problem? It feels like the election was just sort of the bubbling over of a lot of long-simmering kinds of issues in this realm.
I do think the election was, certainly in the case of Facebook, a key inflection point, not just in how the public perceives them but how they perceive themselves, right? The biggest sign that things are seriously amiss, or that there’s real turmoil in Facebook is the number of leakers that journalists have managed to find. Historically, Facebook was like the most impenetrable company ever. Nobody would ever leak or talk bad about it and now they are, and a lot of this dirty laundry and the palace intrigue, all that shit is leaking out now in a way that it wouldn’t in the past. I think the election definitely fractured that internal sort of mission focus and cohesion that Facebook has traditionally enjoyed. I mean, to your broader question of when was there a transition point? I don’t know, I think it certainly fits the narrative to say, “Aha, the key moment in the movie, when everything changed …”
I think a lot of the save-the-world stuff comes from the origins of the Valley. If you go back to the Seventies and the counterculture, the hippy flower children dropped out, and Silicon Valley was this alternative to mainstream, industrial life. Steve Jobs would never have gotten a job at IBM or a more conventional firm. He had to create this other thing, which was imbued with a lot of that hippy dippy whatever. After a while, the whole thing became more sharp elbowed. It wasn’t hippies showing up any more.
There was a lot more of the libertarian, screw-the-government ethos. That whole idea of move fast, break things, and damn the consequences — which by the way is a very powerful philosophy. I’m not completely dinging it, you kind of need to have that attitude to get things done but, yeah, you do end up in situations like you did in this.
I think Silicon Valley has changed. It still flies under this marketing shell of “making the world a better place.” But under the covers it’s this almost sociopathic scene. Even me, when I had my shitty little start-up that I acquired, I was also in total asocial personality disorder mode, and I think it characterizes a lot of people in this world. (...)
What changes could have been made in the ad business and in the business models of internet advertising that could have averted some of this at least? Take Cambridge Analytica just as a recent example of this. I’m kind of curious about the ways in which the business model could have been reoriented to avoid some of this.
Look, I mean, advertising sucks, sure. But as the ad tech guys say, “We’re the people who pay for the internet.” It’s hard to imagine a different business model other than advertising for any consumer internet app that depends on network effects. I just can’t think of many examples of viable businesses of that nature that weren’t based on advertising. What else are you going to do? How else do you pay for this?
One proposal would be something like subscriptions. Is there an alternative that is meant for the public benefit, that you think makes sense? Is that something that resonates at all?
Normally I just discard the subscription proposal. Facebook’s actual average revenue per user in developed nations like the U.S. is pretty damn high. So it would put it on the order of a Netflix subscription, or more, potentially. Even though people might derive that much value from it, it’s unlikely that they’re just going to fork out a couple hundred bucks a year for Facebook.
Maybe in mature markets where everyone who is going to become a Facebook user is already a Facebook user, maybe there you could do it, if you combined it with some premium features, like I post a lot on Facebook and I have a blue checkmark and I guess I’m a power user, whatever. Posting on Facebook is at least as much about pumping my own personal brand as it is keeping touch with friends. Yeah, would I pay 23 bucks a month for really nice, advanced feature and a better UI, and posts that went out a certain time and better analytics? Yeah, maybe I would. It’s not crazy.
The other question is what do you charge, right? How does the pricing work? Part of the point of advertising is that it’s a price-discovery mechanism. You just don’t know what that time is worth until you actually subject it to an ads auction model. So, I mean, how’s it going to work? The reality is, it could end up being the developed world subsidizing Facebook for the developing world. Which is already the case, I guess, in the sense that the amount of money that Facebook makes in ads sort of provides Facebook for India. India doesn’t pay for itself, frankly. The U.S. and Europe pay for Facebook and then the marginal cost of it is relatively small, so they give it away in Brazil or India, or whatever, right?
You get into these pricing problems because there’s going be an old lady in Arkansas who’s only willing to pay 50 bucks for Facebook and then there’s me, I’d pay $1,000 a year probably for it, for personal branding reasons. But, I mean, how do you distinguish those two?
• Former Facebook manager Sandy Parakilas on privacy, addiction, and why Facebook must “dramatically” change its business model.
• Early Facebook investor Roger McNamee on Facebook propaganda, early warning signs, and why outrage is so addictive.
• Former Facebook designer Soleio Cuervo on Facebook’s commitment to users, what the media gets wrong, and why regulation is unnecessary.
• Former Zuckerberg speechwriter Kate Losse on how the Facebook founder thinks and what is hardest for him to wrap his mind around.
This interview is with Antonio Garcia Martinez, a product manager on the Facebook Ads team between 2011 and 2012. He is the author of Chaos Monkeys: Obscene Fortune and Random Failure in Silicon Valley Kindle.
There’s an assumption that what Facebook does for advertisers is hugely influential. But on the other hand, as Zuckerberg said right after the election, it was a pretty crazy idea that fake news could influence an election in a meaningful way. Where do you think that dissonance kind of came from? As somebody who worked on the ad side.
So you’re referring to his somewhat jaw-dropping initial post after the election on November 11th or 12th or whatever it was, right? The one where he basically dismissed the claim that Facebook could have impacted the election. I mean, that was kind of a crazy claim. I also was clearly astonished when I read it. Until literally a few days before, this entire ad sales team at Facebook was literally telling every politician with any budget that Facebook can actually hand them the election. It is incredibly disingenuous and strange for an exec to get up and say that there’s no way Facebook could have potentially impacted the election.Two or three days later someone sat him down, and he very quickly backpedaled. I mean, that I think is the combination of a few factors. At the exec level, it might just be a function of the fact that he doesn’t know too much about ads, and when I say that it sounds horrible, but I don’t mean it in a necessarily critical way. Zuck has famously never been very interested in either money or revenue of the company. Obviously he understands that it’s a necessary evil, but it’s the sort of thing that he just outsources to Sheryl and whatever lieutenants that are taking care of the ad system.
He’s a micromanager, and I never even saw him once in the ads area micromanaging anything. He just doesn’t care. I’m sure he knows but not in a top-of-mind sort of way that there’s an ad political sales force numbering in the hundreds and a huge D.C. office and that there’s this entire effort actually to make politics more sensational. Look, it’s probably not something that he thought of when he sat down in a postelection moment of panic or emotion or whatever to write about, right? So I think some of it’s just that. Some of it’s … people always approach this with this kind of overweening techno-optimism, right?
They only ever see the positive side of the technologies they create. I mean, part of that is because we really, at heart, really are just such optimists, they can’t imagine negative scenarios, they don’t have some kind of, sort of tragic history.
At what moment would you say that blindness actually became a really big problem? It feels like the election was just sort of the bubbling over of a lot of long-simmering kinds of issues in this realm.
I do think the election was, certainly in the case of Facebook, a key inflection point, not just in how the public perceives them but how they perceive themselves, right? The biggest sign that things are seriously amiss, or that there’s real turmoil in Facebook is the number of leakers that journalists have managed to find. Historically, Facebook was like the most impenetrable company ever. Nobody would ever leak or talk bad about it and now they are, and a lot of this dirty laundry and the palace intrigue, all that shit is leaking out now in a way that it wouldn’t in the past. I think the election definitely fractured that internal sort of mission focus and cohesion that Facebook has traditionally enjoyed. I mean, to your broader question of when was there a transition point? I don’t know, I think it certainly fits the narrative to say, “Aha, the key moment in the movie, when everything changed …”
I think a lot of the save-the-world stuff comes from the origins of the Valley. If you go back to the Seventies and the counterculture, the hippy flower children dropped out, and Silicon Valley was this alternative to mainstream, industrial life. Steve Jobs would never have gotten a job at IBM or a more conventional firm. He had to create this other thing, which was imbued with a lot of that hippy dippy whatever. After a while, the whole thing became more sharp elbowed. It wasn’t hippies showing up any more.
There was a lot more of the libertarian, screw-the-government ethos. That whole idea of move fast, break things, and damn the consequences — which by the way is a very powerful philosophy. I’m not completely dinging it, you kind of need to have that attitude to get things done but, yeah, you do end up in situations like you did in this.
I think Silicon Valley has changed. It still flies under this marketing shell of “making the world a better place.” But under the covers it’s this almost sociopathic scene. Even me, when I had my shitty little start-up that I acquired, I was also in total asocial personality disorder mode, and I think it characterizes a lot of people in this world. (...)
What changes could have been made in the ad business and in the business models of internet advertising that could have averted some of this at least? Take Cambridge Analytica just as a recent example of this. I’m kind of curious about the ways in which the business model could have been reoriented to avoid some of this.
Look, I mean, advertising sucks, sure. But as the ad tech guys say, “We’re the people who pay for the internet.” It’s hard to imagine a different business model other than advertising for any consumer internet app that depends on network effects. I just can’t think of many examples of viable businesses of that nature that weren’t based on advertising. What else are you going to do? How else do you pay for this?
One proposal would be something like subscriptions. Is there an alternative that is meant for the public benefit, that you think makes sense? Is that something that resonates at all?
Normally I just discard the subscription proposal. Facebook’s actual average revenue per user in developed nations like the U.S. is pretty damn high. So it would put it on the order of a Netflix subscription, or more, potentially. Even though people might derive that much value from it, it’s unlikely that they’re just going to fork out a couple hundred bucks a year for Facebook.
Maybe in mature markets where everyone who is going to become a Facebook user is already a Facebook user, maybe there you could do it, if you combined it with some premium features, like I post a lot on Facebook and I have a blue checkmark and I guess I’m a power user, whatever. Posting on Facebook is at least as much about pumping my own personal brand as it is keeping touch with friends. Yeah, would I pay 23 bucks a month for really nice, advanced feature and a better UI, and posts that went out a certain time and better analytics? Yeah, maybe I would. It’s not crazy.
The other question is what do you charge, right? How does the pricing work? Part of the point of advertising is that it’s a price-discovery mechanism. You just don’t know what that time is worth until you actually subject it to an ads auction model. So, I mean, how’s it going to work? The reality is, it could end up being the developed world subsidizing Facebook for the developing world. Which is already the case, I guess, in the sense that the amount of money that Facebook makes in ads sort of provides Facebook for India. India doesn’t pay for itself, frankly. The U.S. and Europe pay for Facebook and then the marginal cost of it is relatively small, so they give it away in Brazil or India, or whatever, right?
You get into these pricing problems because there’s going be an old lady in Arkansas who’s only willing to pay 50 bucks for Facebook and then there’s me, I’d pay $1,000 a year probably for it, for personal branding reasons. But, I mean, how do you distinguish those two?
by Noah Kulwin and Antonio Garcia Martinez, NY Magazine | Read more:
Image: Helena Price
