Case study.

1. FACEBOOK : IT’S
ABOUT THE
MONEY
CASE STUDY

2. Muhammad Sazzad Hossain
B-130203017

3. Introduction
 Launched in February 2004.
 Connect people easily.
 Hundreds million accounts.
 Almost all revenue from advertising.
 Big benefit from advertising.
 No laws to say what the networks companies do.

4. Country analysis (PEST)
Political
Economy
Social
Technology

5. Country analysis (cont.)
• USA has a strong democratic setup and effective rule of law, with elections that are considered
fair and transparent.
• The country enjoys massive political and economic influence over both national and global
policymaking.
• the country faces international criticism for its interventionist policies regarding the ‘War on
Terror’ which is souring foreign relations, and at the same time fueling terrorist groups,
increasing the threat of terrorism.
Political
• With a GDP of over $16.760 trillion, the US is the largest economy in the world.
• The recession in 2009 adversely affected the economy of the country and unemployment
soared to an alarming point.
• But the economy bounced back with a growth of around 4% in the third quarter of 2014 as
consumers and businesses have stepped up spending.
• However, the increasing budget deficit puts the economic prosperity of the country at grave
as the deficit currently amounts to a staggering $506 million.
Economy

6. Country analysis (cont.)
• Like most developed countries, the US faces the problem of an aging population which can
lead to a serious labor shortage and rising tax rates in the future.
• Nonetheless, the education and healthcare system is one of the best in the world.
• A majority of the population has a liberal mindset, but rising racial intolerance is a serious
concern.
• Additionally, increasing illegal immigration is another concern, as there are currently more
11.7 million people living illegally in the US, further increasing the risk of racial discrimination.
Social
• Innovation and technology are the cornerstones of the US economy. Since its inception, the
country has been leading in terms of adapting and applying technology.
• The US has also been at the forefront in enhancing and developing technologies in areas such
as nanotechnology, environmental technology and biotechnology, which opens up massive
opportunities for companies with expertise in the mentioned fields.
• IT is another field the US has been excelling in. However, it has also been facing intense
competition from countries like China and India.
Technological

7. Company SWOT analysis
• Facebook just recently eclipsed the 1 billion users mark, and the number of users Facebook
possesses has grown explosively since its creation, as the chart below displays.
• In 2011, Facebook was the most visited website and most searched term on the internet.
• It can be used for marketing, advertising, recruitment & brand enhancement.
• Enormous and permanent data about all its users. Even if Facebook goes bankrupt tomorrow, it
still own all the user data and be able to sell it.
• Constant innovation of the site and its offerings.
• The ability and interface to Connect with applications such as Travelocity, Digg etc., All this
Facebook to gain more insight about the user and hence has more data which it can sell.
Strengths
• Users are growing more concerned about privacy violation. It’s hard for Facebook to draw a line
between providing great features to users and encroaching their privacy
• The company has no dividend, and has expressed no plans to begin paying out dividends in the
future.
• Before Facebook, Myspace was the premier social network, nothing is stopping anyone from
inventing a bigger and better version.
Weaknesses

8. Company SWOT analysis (Cont.)
•The opportunity in the mobile sector is immense, as COO Sheryl Sandberg put it, “Mobile is a great
opportunity to grow our users, to grow engagement and to grow monetization, and we’re at a very early
stage.”
•Because of the plethora of information Facebook receives from each member, it can send advertisements
are more likely to interest that specific person, and therefore they can charge more for ads than other
companies.
•Capture all the TV channel on live and vanish the television industry.
Opportunities
•Major publically-traded competitors of Facebook include Google (NASDAQ: GOOG) and LinkedI (NYSE:
LNKD).
•Google is a much larger and more diversified company, however they recently released a social network,
Google+, to get their feet into the market.
•LinkedIn also is an operator of a social network, however theirs is more focused on the business man or
women as a device to link them to potential customers or employers, and unlike Facebook, LinkedIn offers
premium service which they charge for.
•Instagram.
•Tweeter.
Threats

9. Case study question
 Perform an ethical analysis of Facebook. What is the ethical dilemma
presented by this case ?
 What is the relationship of privacy to Facebook's business model ?
 Describe the weaknesses of Facebook’s privacy policies and features.
What management, organization, and technology factors have
contributed to those weaknesses ?
 Will Facebook be able to have a successful business model without
invading privacy ? Explain your answer. Are there any measures Facebook
could take to make this possible ?

10. Perform an ethical analysis of Facebook. What is
the ethical dilemma presented by this case?
Identify and describe the
facts clearly
Define the conflict or
dilemma and identify the
higher-order values
involved
Identify the stakeholders
Identify the options that
you can reasonably take
Identify the potential
consequences of your
options.

11. Perform an ethical analysis of Facebook. What is
the ethical dilemma presented by this case?
(Cont.)
Identify and describe the facts clearly:
• Lots of information, only to bring in revenue.
• Engage with users highly possible.
• Is used for you or against you.
Define the conflict or dilemma and identify the higher-order values involved:
• A revenue stream.
• No laws is US to know what information FB has collected.
• EPIC(privacy Inf. Center) wants FB to restore its privacy.

12. Perform an ethical analysis of Facebook. What is
the ethical dilemma presented by this case?
(Cont.)
Identify the stakeholders:
• The owner of the company.
• The employees of the company.
• The users of the website.
• The advertisement that use the service of Facebook.
Identify the options that you can reasonably take:
• Notice and awareness.
• Choice and consent.
• Access and participants.

13. Perform an ethical analysis of Facebook. What is
the ethical dilemma presented by this case?
(Cont.)
Identify the potential consequences of your options:
• Nobody lets the company collect the information.
• Decreasing the company revenue.
• But creating of a reliable social network.

14. What is the relationship of privacy to Facebook's business
model?
Privacy policy.
Payment terms.
Platform policies.
Ads guidelines.
Promotion guidelines.
Claims of intellectual property infringement.
Claims of copyright infringement etc.

15. Describe the weaknesses of Facebook’s privacy policies and
features. What management, organization, and technology factors
have contributed to those weaknesses?
Management Factor:
Strategic management of FB’s
Revenue comes almost from advertising.
Organization Factor:
To be more open an connected the world.
Privacy setting awareness is less.
Technology Factors:
Application helps to collect data of users.
Without notifying users.

16. Will Facebook be able to have a successful business
model without invading privacy? Explain your answer.I don’t think that FB will be able to
a successful business model without
invading privacy. Facebook currently is
serving as much to advertise and
people as it earns from those
advertisements. There are no fees that
are to be paid to join FB or for its use,
all seems like they threw in a few
advertisements and hoped that its
exposure would bring in
consumers. Obviously, the backbone
FB’s business model is advertisement.
As a result, FB needs more users data
to customized its ads and indirectly
DEFINITELY, NO!

17. Are there any measures Facebook could take to
make this possible?
To alert all the members of FB with an electronic detailed letter stating that for advertising
purpose information that is submitted to your information pages will be used by Fb company.
To give the users the options to either accepts or reject this offer in order to install a legal
standing that with the users of the site as well as protect the integrity of the company.
To offer applications that could be put on their pages in terms of interactive games and trivia, in
return for allowing FB to access users account for advertising purposes.

18. Be aware what you post !!
Thank you for your attention !!