Facebook and Alphabet’s Google unit facing a face-growing number of government probes from Congress, executive branch
When Facebook asked the Federal Election Commission for a waiver from disclosure rules on political advertising in 2011, its request was backed in force by Republicans and Democrats alike.
But six years after both parties’ national and Congressional leadership committees helped Facebook secure the exemption, the friendly landscape in Washington has shifted dramatically against the company.
What began with loud demands in Congress — to find out how much influence fake news and foreign-sponsored ads on Facebook impacted the U. S. 2016 Presidential campaign — has now spread to both ends of Pennsylvania Avenue.
And the growing number of probes portend trouble not only for Facebook but also for its chief rival, Alphabet’s Google unit, which previously has also benefited from the disclosure waiver for online political ads.
Both companies have grown to extraordinary size thanks to software that helps online marketers advertise products and services to very specific audiences.
The have become favorites of investors and are among the five most valuable publicly traded companies, with Google parent Alphabet worth $659 billion and Facebook valued at $487 billion.
But as their stock prices have risen, so have the number of investigations into their business and personnel dealings. Here’s a rundown:
And to add to Google’s bad month, the company was also hit with a class-action lawsuit by three former employees over the gender pay issue.
To find out why the two internet giants have become such high-profile targets in the U. S. capital, the letter from Rep. Smith provides a good clue.
Smith’s statement explains that Google and Facebook are now de facto media companies and, in a sense, victims of their own success in developing sophisticated digital-ad technologies.
“Social media platforms…have the ability to serve as an effective propaganda arm conveying specific messages,” Smith wrote.
With the American electorate sharply split along partisan lines, companies that can quickly spread political propaganda are going to face a reckoning.
As the events of this week have shown, such a reckoning in Washington for Google and Facebook has arrived.