BOB GARFIELD: This is On The Media, I'm Bob Garfield.
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BOB GARFIELD: Back in the halcyon days of 2006, when the world was innocent and Facebook had a mere 12 million users, Roger McNamee got a call. At the time, he was just a member of a jam band–the one we're listening to actually. And also a rich and influential Silicon Valley investor whose business partner was Bono. The phone call was from a Facebook executive asking if McNamee would meet with 22 year old Mark Zuckerberg.
ROGER MCNAMEE: When I first met Mark I was very excited because I thought he had exactly the idea at exactly the right time. It was not at all obvious he day I met him, that anything could possibly go wrong in this idea.
BOB GARFIELD: Yeah well, live and learn. But something was obvious to McNamee and he volunteered it before the young entrepreneur even opened his mouth.
ROGER MCNAMEE: I said if it hasn't already happen, either Yahoo or Microsoft is going to offer a billion dollars to buy Facebook and everybody, you know, is going to say Mark take the money. You can change the world with that kind of money. Your Venture Capital will tell you he'll back your next startup and you'll be just as successful the next time. And I said, 'Mark, I can't tell you what to do, but if you really believe in your vision, you're going to have to explain to these people that you're not going to sell.' What followed was the most unbelievable thing it's ever occurred to me in a business meeting.
BOB GARFIELD: Zuckerberg sat there ruminating, total silence, for five minutes.
ROGER MCNAMEE: Imagine a human being pantomiming thinker poses.
ROGER MCNAMEE: Without saying a word. And about the three minute mark my fingernails are embedded in the couch cushions. And I'm--I'm having a really hard time not screaming.
BOB GARFIELD: Zuckerberg might have been a little freaked out too, because unbeknownst to McNamee, he had indeed gotten such an offer from Yahoo of $1 billion. The near future tycoon asked,.
ROGER MCNAMEE: 'How did you know?' I said, 'Mark, I've been doing this quarter of a century. This is what happens when a company is as promising as Facebook.'
BOB GARFIELD: This may have been a rare moment in the history of Facebook. Mark Zuckerberg was not only reflective about the downstream ramifications of a business decision but he heeded the wisdom of an outsider. And then, not long thereafter, he did the same thing by taking McNamee's suggestion to hire former senior Treasury Department official and Google exec Sheryl Sandberg as COO. A decade later, Facebook is valued at a half trillion dollars and Zuckerberg is among the richest and most influential men on earth. Good talk son. As an investor and as a citizen, McNamee has continued to pay much closer attention to Facebook than Zuckerberg would prefer. For the past two and a half, years he's been warning first Facebook management, then everybody else that the world's dominant social media platform has become a menace.
MALE CORRESPONDENT: A new report has found that Facebook failed to prevent its platform being used to incite violence and Myanmar.
FEMALE CORRESPONDENT: Cambridge Analytica mine users information without their consent.
FEMALE CORRESPONDENT: Hired a PR firm to dig up dirt on its competitor.
FEMALE CORRESPONDENT: Helping to spread misinformation and fake news stories that benefited--.[END CLIP]
BOB GARFIELD: And a new book Zucked: Waking Up to the Facebook Catastrophe, McNamee presents a bill of indictment for the companies many victims–our economy, our media, our public health, our actual brains and our democracy. The core of the problem, he says, began with the 2006 introduction of the Facebook News Feed,.
ROGER MCNAMEE: The biggest single problem with it was that it doesn't have a signal to stop. When you're watching television, eventually the credits roll. And that's a signal, 'go on and do something else.' News Feed is infinite, there is no signal. If you take that in combination with tagging, where you would tag the people in the photograph and then Facebook would send a message saying, 'hey so-and-so tagged you in this photograph, and that creates a psychological need validation but also need to reciprocate. And so it turned out that tagging was the first thing inside Facebook that created virality. It was the first step on the way to this horrible problem. But in the early days, it seemed really harmless. And they basically wore us down in 2011. A genius from MoveOn named Eli Pariser introduced the idea of the filter bubble. Mark Zuckerberg, a journalist was asking him a question about the news feed. And the journalist was asking him, you know, 'why is this so important?' And Zuckerberg said, 'a squirrel dying in your front yard, maybe more relevant to your interests right now than people dying in Africa.'
ROGER MCNAMEE: And he noticed that his news feeds on Google and Facebook were no longer neutral. That they were essentially playing to what they perceived were his biases. And they weren't telling him they were doing it. They weren't telling anybody that. And so he was really worried that by altering the experience without us knowing it, there were going to be unintended consequences we weren't going to like. And I don't know that he knew, then, what that meant–I know, I didn't. But what we discovered was that it was going to be enough to affect, you know, how democracy works all over the world.
BOB GARFIELD: One of the most indicting facts in your book gets to their strategy of building scale at all costs. Going from 600 million users to a billion users to, now, 2.2 billion users worldwide. And part of that strategy hinged on deals with third party apps.
ROGER MCNAMEE: In the early years of Facebook, the sole goal was to add users. But eventually, when they decided it was time to get revenue, somebody somewhere figured out that if they were going to get revenue, it wasn't enough to have people show up for a minute a day. They needed to keep them a lot longer so they could see ads. And Zynga, which created FarmVille and CityVille and a bunch of other games, came to market with that precise insight and crafted a business model for games inside Facebook. They basically tricked Facebook's algorithms to give them access to Facebook friends list. And the result of which was that you almost immediately saw an increase the number of minutes per day people were using Facebook, and the economic benefit to Facebook was huge. What was really inappropriate about it was that the Federal Trade Commission came to the company off of the Zynga experience and a few things like it and said, 'we're going to force you to sign a consent decree. You can't do this with people's data. You have to get informed prior consent.' They basically didn't hire anybody to enforce the decree. They didn't change their products in any way. They continued to let applications download all of the friends data from the people who use them. And that's how Cambridge Analytica got the data it used. The reason I'm sympathetic towards them is that they didn't go out of their way to exploit every advantage they had in those early days. It took them awhile to get there. Their resistance got worn down by decrees and the pressure of going public, the pressure of the earnings forecasts that came way down during the public offering process. All of those things conspired to raise the pressure on Mark and Sheryl and, I think, led to them making changes in policy that created all the problems.
BOB GARFIELD: But if the principles were, at first, unaware of the power they were wielding, as McNamee says, they should certainly have known better by 2016 when Alex Stamos, than Facebook's chief security officer, assembled a team to investigate how Russian operatives had pushed propaganda on Facebook.
ROGER MCNAMEE: I wasn't speaking publicly in 2016. I just went to them and said, 'guys I see all these different things going on.' In my book, I give you the draft op-ed that I shared with them on October 30th 2016 that describes what my fears were– which, turns out, were correct. And then Stamos gave me real data in December and they were totally resistant to that. And where I have the problem is that once the facts became undeniable, at some point, companies have to take responsibility for the consequences of their actions. And Facebook is amazingly profitable because they've never had to bear the cost of the consequences their actions. And you know, that used to be true of the chemical industry. And then we decided in the 70s that, 'no, I'm sorry we're going to these things called Superfund sites and you guys are responsible for cleaning up.' That day of reckoning is coming here and it can't come soon enough from my perspective.
BOB GARFIELD: All right. Your book looks at Facebook and--and at Google, the other half of the duopoly, and the rest of social media–much of which is owned by Facebook. And you offer a template for dealing with the issues that these platforms have wrought. It would seem to be a clear antitrust case against the duopoly because they're so horizontally and vertically integrated. But we run into this problem that the users get the service for free which presents a regulation problem. No?
ROGER MCNAMEE: It does. Since 1981, we've operated with this notion that, for antitrust law, the only possible consumer harm is an increase in price. And because these are notionally free products, they seem to get a pass. That's a narrow reading. What's really going on is that it's a barter where the companies trades services for personal data. And there's actually an increasing body of economic research that points out, that in those transactions, the data is the currency. So it is possible to measure changes in price and changes in value received. And so there's a lot of work going on and a Nobel Prize was awarded last year to a couple of professors for solving this problem relative to carbon credits–another situation with that currency involved.
Throughout the book, you quote Mark Zuckerberg's founding bromide.
MARK ZUCKERBERG: This idea, we care about so much, that--that all people want to connect. So we just kept pushing forward on it. [END CLIP]
BOB GARFIELD: Do you believe he's just in denial about the Frankenstein's monster he's created? Or is he knowingly risking the health of societies out of greed and ambition?
ROGER MCNAMEE: I don't know. My guess is that how he looks at the problem has changed. But, you know, obviously he's not talking to me so I don't know exactly how he's thinking about it. And Sheryl's not talking to me either so I don't know how she's thinking about it either. But I do know that they're not playing this game at an intellectual level. I mean the thing that really broke my heart last year was when the news came out Facebook retaining a political opposition research firm called definers to spread disinformation about two critics–one of whom was Apple computer, the other of whom was George Soros. And the technique that Definers used on Soros was to spread an anti-Semitic conspiracy theory that had originated in Eastern Europe. I've tried my best to keep a positive view of two people I really trusted and that I worked with for a number of years and I really liked. And it gets harder by the day to do that.
BOB GARFIELD: One last thing. We discussed how you were the one who turned Mark Zuckerberg onto Sheryl Sandberg. We talked about how in 2006 when Yahoo was trying to bid on Facebook, you advised young Mark Zuckerberg not to accept the deal. Is this all your fault?
ROGER MCNAMEE: Well I feel an enormous sense of responsibility. Because every morning I wake up and think to myself, you know--you know, 'I played a small role.' This thing had a thousand fathers and my role wasn't that big, but there were these two things that happened that really did make a difference and if they hadn't happened you would have a outcome. But there are a lot of things that also happened that could have also put us back on a good track and those didn't happen either. What I hope is that everybody who's been involved will pull together and, just, let's help these companies get to the right place, to make that change, to give them permission to reverse course and to go back to the idealism that infected Silicon Valley for so many years.
BOB GARFIELD: You still have a Facebook account?
ROGER MCNAMEE: Oh yeah, not only that, I'm still a shareholder. But my usage has changed a lot. I don't do any politics anymore. I don't get any news from it. I don't block anybody. I don't get into arguments. I just let all of that stuff slide off me and I advise others to do the same. You know, people who are not on Facebook. People are not and Google are still touched by all of this stuff. We all have a stake in it and these companies right now are transforming the economy to their benefit without doing what Joseph Schumpeter would have described as the appropriate form of creative destruction–which is one where the new thing fills all the holes left by the old and makes the world a better place. Because what these guys what they're doing now is they're doing the destruction part, seizing the value and then not replacing it. We now know that's not healthy and we should probably try to stop it everywhere in the economy.
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BOB GARFIELD: Roger, thank you very much.
ROGER MCNAMEE: This has been a huge pleasure for me and a thrill. So thank you so very much.
BOB GARFIELD: Roger McNamee, former venture capitalist is now an activist and author of Zucked: Waking Up to the Facebook Catastrophe.