The market for Facebook Privacy

Facebook has finally decided to increase their security standards. (Article is attached) This poses the curious question as to why. The founder and CEO of facebook, a 26 year old billionaire, has publicly said that he does not believe in privacy. Privacy also is not a great business model for a company that hopes to eventually turn their client preferences into advertising dollars, so why increase privacy?

The answer is simple, the people demanded it. We can see through google trends (article linked) that an increasing number of people were attempting to remove their facebook accounts. Facebook had no option but to respond to this, because if they lose their customer base, they have no business. The company listened and is currently increasing security.

This tells us a lot about the market. We have a CEO/Owner who doesn't believe in privacy rights, a company that is based around that lack of privacy yet the consumer of the service wins. Why? Facebook knew people deleting their account were not just leaving facebook but were likely headed to one of their competitors. Web 2.0 is here to stay, and if facebook wants to remain in the lead (no matter their size), they have to give consumers what they want. Customers demand privacy and now they will get it.

Some will claim that since Facebook is trying to gain a monopoly/is market dominant, they will not have to respond to consumers. We know this is false. Monopolies have some great say of prices and the quantity they supply but they cannot dictate consumer preferences. Those preferences belong to the consumer alone.

Economic forces are all around us. Even in privacy settings of facebook, apparently.