Tag: Elliot Schrage

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Tech giants offer empty apologies because users can’t quit

A true apology consists of a sincere acknowledgement of wrong-doing, a show of empathic remorse for why you wronged and the harm it caused, and a promise of restitution by improving ones actions to make things right. Without the follow-through, saying sorry isn’t an apology, it’s a hollow ploy for forgiveness.

That’s the kind of “sorry” we’re getting from tech giants — an attempt to quell bad PR and placate the afflicted, often without the systemic change necessary to prevent repeated problems. Sometimes it’s delivered in a blog post. Sometimes it’s in an executive apology tour of media interviews. But rarely is it in the form of change to the underlying structures of a business that caused the issue.

Intractable Revenue

Unfortunately, tech company business models often conflict with the way we wish they would act. We want more privacy but they thrive on targeting and personalization data. We want control of our attention but they subsist on stealing as much of it as possible with distraction while showing us ads. We want safe, ethically built devices that don’t spy on us but they make their margins by manufacturing them wherever’s cheap with questionable standards of labor and oversight. We want groundbreaking technologies to be responsibly applied, but juicy government contracts and the allure of China’s enormous population compromise their morals. And we want to stick to what we need and what’s best for us, but they monetize our craving for the latest status symbol or content through planned obsolescence and locking us into their platforms.

The result is that even if their leaders earnestly wanted to impart meaningful change to provide restitution for their wrongs, their hands are tied by entrenched business models and the short-term focus of the quarterly earnings cycle. They apologize and go right back to problematic behavior. The Washington Post recently chronicled a dozen times Facebook CEO Mark Zuckerberg has apologized, yet the social network keeps experiencing fiasco after fiasco. Tech giants won’t improve enough on their own.

Addiction To Utility

The threat of us abandoning ship should theoretically hold the captains in line. But tech giants have evolved into fundamental utilities that many have a hard time imagining living without. How would you connect with friends? Find what you needed? Get work done? Spend your time? What hardware or software would you cuddle up with in the moments you feel lonely? We live our lives through tech, have become addicted to its utility, and fear the withdrawal.

If there were principled alternatives to switch to, perhaps we could hold the giants accountable. But the scalability, network effects, and aggregation of supply by distributors has led to near monopolies in these core utilities. The second-place solution is often distant. What’s the next best social network that serves as an identity and login platform that isn’t owned by Facebook? The next best premium mobile and PC maker behind Apple? The next best mobile operating system for the developing world beyond Google’s Android? The next best ecommerce hub that’s not Amazon? The next best search engine? Photo feed? Web hosting service? Global chat app? Spreadsheet?

Facebook is still growing in the US & Canada despite the backlash, proving that tech users aren’t voting with their feet. And if not for a calculation methodology change, it would have added 1 million users in Europe this quarter too.

One of the few tech backlashes that led to real flight was #DeleteUber. Workplace discrimination, shady business protocols, exploitative pricing and more combined to spur the movement to ditch the ridehailing app. But what was different here is that US Uber users did have a principled alternative to switch to without much hassle: Lyft. The result was that “Lyft benefitted tremendously from Uber’s troubles in 2018” eMarketer’s forecasting director Shelleen Shum told the USA Today in May. Uber missed eMarketer’s projections while Lyft exceeded them, narrowing the gap between the car services. And meanwhile, Uber’s CEO stepped down as it tried to overhaul its internal policies.

But in the absence of viable alternatives to the giants, leaving these mainstays is inconvenient. After all, they’re the ones that made us practically allergic to friction. Even after massive scandals, data breaches, toxic cultures, and unfair practices, we largely stick with them to avoid the uncertainty of life without them. Even Facebook added 1 million monthly users in the US and Canada last quarter despite seemingly every possible source of unrest. Tech users are not voting with their feet. We’ve proven we can harbor ill will towards the giants while begrudgingly buying and using their products. Our leverage to improve their behavior is vastly weakened by our loyalty.

Inadequate Oversight

Regulators have failed to adequately step up either. This year’s congressional hearings about Facebook and social media often devolved into inane and uninformed questioning like how does Facebook earn money if its doesn’t charge? “Senator, we run ads” Facebook CEO Mark Zuckerberg said with a smirk. Other times, politicians were so intent on scoring partisan points by grandstanding or advancing conspiracy theories about bias that they were unable to make any real progress. A recent survey commissioned by Axios found that “In the past year, there has been a 15-point spike in the number of people who fear the federal government won’t do enough to regulate big tech companies — with 55% now sharing this concern.”

Regulation could protect Facebook, not punish it

When regulators do step in, their attempts can backfire. GDPR was supposed to help tamp down on the dominance of Google and Facebook by limiting how they could collect user data and making them more transparent. But the high cost of compliance simply hindered smaller players or drove them out of the market while the giants had ample cash to spend on jumping through government hoops. Google actually gained ad tech market share and Facebook saw the littlest loss while smaller ad tech firms lost 20 or 30 percent of their business.

Europe’s GDPR privacy regulations backfired, reinforcing Google and Facebook’s dominance. Chart via Ghostery, Cliqz, and WhoTracksMe.

Even the Honest Ads act, which was designed to bring political campaign transparency to internet platforms following election interference in 2016, has yet to be passed even despite support from Facebook and Twitter. There’s hasn’t been meaningful discussion of blocking social networks from acquiring their competitors in the future, let alone actually breaking Instagram and WhatsApp off of Facebook. Governments like the U.K. that just forcibly seized documents related to Facebook’s machinations surrounding the Cambridge Analytica debacle provide some indication of willpower. But clumsy regulation could deepen the moats of the incumbents, and prevent disruptors from gaining a foothold. We can’t depend on regulators to sufficiently protect us from tech giants right now.

Our Hope On The Inside

The best bet for change will come from the rank and file of these monolithic companies. With the war for talent raging, rock star employees able to have huge impact on products, and compensation costs to keep them around rising, tech giants are vulnerable to the opinions of their own staff. It’s simply too expensive and disjointing to have to recruit new high-skilled workers to replace those that flee.

Google declined to renew a contract with the government after 4000 employees petitioned and a few resigned over Project Maven’s artificial intelligence being used to target lethal drone strikes. Change can even flow across company lines. Many tech giants including Facebook and Airbnb have removed their forced arbitration rules for harassment disputes after Google did the same in response to 20,000 of its employees walking out in protest.

Thousands of Google employees protested the company’s handling of sexual harassment and misconduct allegations on Nov. 1.

Facebook is desperately pushing an internal communications campaign to reassure staffers it’s improving in the wake of damning press reports from the New York Times and others. TechCrunch published an internal memo from Facebook’s outgoing VP of communications Elliot Schrage in which he took the blame for recent issues, encouraged employees to avoid finger-pointing, and COO Sheryl Sandberg tried to reassure employees that “I know this has been a distraction at a time when you’re all working hard to close out the year — and I am sorry.” These internal apologizes could come with much more contrition and real change than those paraded for the public.

And so after years of us relying on these tech workers to build the product we use every day, we must now rely that will save us from them. It’s a weighty responsibility to move their talents where the impact is positive, or commit to standing up against the business imperatives of their employers. We as the public and media must in turn celebrate when they do what’s right for society, even when it reduces value for shareholders. And we must accept that shaping the future for the collective good may be inconvenient for the individual.

For more on this topic:

Internal Facebook memo sees outgoing VP of comms Schrage take blame for hiring Definers

The real threat to Facebook is the Kool-Aid turning sour

Google walkout organizers aren’t satisfied with CEO’s response

Facebook and the endless string of worst-case scenarios

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Internal Facebook memo sees outgoing VP of comms Schrage take blame for hiring Definers

TechCrunch has obtained an internal memo published by Facebook’s outgoing head of public policy Elliot Schrage in which he blames himself for hiring PR firm Definers. He admits to having the company push negative narratives about competitors, but says Facebook did not ask or pay Definers to publish fake news. COO Sheryl Sandberg left a comment on the memo, saying it was never Facebook’s intention to play into anti-semitic theories about George Soros.

The memo includes a Q&A regarding points raised by a New York Times article detailing how Definers worked to spread negative publicity about Google and other tech giants to make Facebook look better, and that the firm’s employees also published biased articles bashing Facebook’s competitors and critics through a news site called NTK Network that’s affiliated with Definers.

In the memo, Schrage justifies the use of opposition research, and chastizes Facebook employees for allowing internal finger pointing surrounding its troubled past two years to become public. He also notes that his replacement, Facebook’s new head of global policy and former UK deputy Prime Minster Nick Clegg will be reviewing its work with all political consultants, which could turn up more skeletons.

Facebook’s former head of policy and comms Elliot Schrage (left)

Schrage announced in June that he’d be stepping down in the wake of the Cambridge Analytica scandal, but would stay on to help find a replacement. Many have asked who, if anyone, would be fired for putting Facebook in cahoots with Definers. As TechCrunch previously reported, Schrage was atop the chain of command here. Given his extensive experience in public policy, was likely well aware of the nature of Definers’ work. Schrage taking the blame provides a convenient solution to the issue, as he’s already on his way out.

“Responsibility for these decisions rests with leadership of the Communications team. That’s me. Mark and Sheryl relied on me to manage this without controversy” Schrage writes. “I knew and approved of the decision to hire Definers and similar firms. I should have known of the decision to expand their mandate . . . I’m sorry I let you all down. I regret my own failure here.” This explanation serves to protect Zuckerberg and Sandberg from additional blame, even as Sandberg strives to show she’s not passing the buck by noting “I want to be clear that I oversee our Comms team and take full responsibility for their work and the PR firms who work with us.”

Schrage’s defense of his bosses provides additional cover for Zuckerberg’s comments from a CNN interview that ran tonight in which he said he won’t step down as Facebook’s chairman and hopes to continue working alongside Sandberg for decades to come. The memo could have been aimed at quieting internal unrest about Facebook’s chief lobbyist Joel Kaplan. His ties to the GOP, support for Supreme Court Justice Brett Kavanaugh, and involvement with Facebook’s latest PR troubles had led some employees to question his employment. Now Facebook has someone else to take the heat.

Schrage is effectively jumping on the grenade here.

The memo and comment can be found below:

Internal Facebook Memo By Elliot Schrage

Many of you have raised questions about our relationship with the Definers consulting firm. We’ve been looking into this and though it is close to a holiday for many of you I wanted to share an update on what we’ve learned and where things stand:

Why did we hire Definers?

We hired Definers in 2017 as part of our efforts to diversify our DC advisors after the election. Like many companies, we needed to broaden our outreach. We also faced growing pressure from competitors in tech, telcos and media companies that want government to regulate us.

This pressure became particularly acute in September 2017 after we released details of Russian interference on our service. We hired firms associated with both Republicans and Democrats — Definers was one of the Republican-affiliated firms.

What did we ask them to do and what did they do?

While we’re continuing to review our relationship with Definers, we know the following: We asked Definers to do what public relations firms typically do to support a company — sending us press clippings, conducting research, writing messaging documents, and reaching out to reporters.

Some of this work is being characterized as opposition research, but I believe it would be irresponsible and unprofessional for us not to understand the backgrounds and potential conflicts of interest of our critics. This work can be used internally to inform our messaging and where appropriate it can be shared with reporters. This work is also useful to help respond to unfair claims where Facebook has been singled out for criticism, and to positively distinguish us from competitors.

As the pressure on Facebook built throughout the year, the Communications team used Definers more and more. At Sheryl’s request, we’re going through all the work they did, but we have learned that as the engagement expanded, more people worked with them on more projects and the relationship was less centrally managed.

Did we ask them to do work on George Soros?

Yes. In January 2018, investor and philanthropist George Soros attacked Facebook in a speech at Davos, calling us a “menace to society.” We had not heard such criticism from him before and wanted to determine if he had any financial motivation. Definers researched this using public information.

Later, when the “Freedom from Facebook” campaign emerged as a so-called grassroots coalition, the team asked Definers to help understand the groups behind them. They learned that George Soros was funding several of the coalition members. They prepared documents and distributed these to the press to show that this was not simply a spontaneous grassroots movement.

Did we ask them to do work on our competitors?

Yes. As I indicated above, Definers helped us respond to unfair claims where Facebook was been [sic] singled out for criticism. They also helped positively distinguish us from competitors.

Did we ask them to distribute or create fake news?

No.

Who knew about this work, and who signed off on it?

Responsibility for these decisions rests with leadership of the Communications team. That’s me. Mark and Sheryl relied on me to manage this without controversy.

I knew and approved of the decision to hire Definers and similar firms. I should have known of the decision to expand their mandate. Over the past decade, I built a management system that relies on the teams to escalate issues if they are uncomfortable about any project, the value it will provide or the risks that it creates. That system failed here and I’m sorry I let you all down. I regret my own failure here.

Why have we stopped working with them?

Mark has asked us to reevaluate how we work with communications consultants. It’s not about Definers. It is about us, not them.

Mark has made clear that because Facebook is a mission driven company, he wants to hold us to a higher standard. He is uncomfortable relying on any outside firm to make decisions about how to make our case about our mission, policies, competitors and critics until he can become comfortable with our management, oversight and escalation.

Where are we now?

Many people across the company feel uncomfortable finding out about this work. Many people on the Communications team feel under attack from the press and even from their colleagues. I’m deeply disappointed that so much internal discussion and finger pointing has become public. This is a serious threat to our culture and ability to work together in difficult times.

Our culture has long been to move fast and take risks. Many times we have moved too quickly and we always learn and keep trying to do our best. This will be no exception.

What happens next?

Our legal team continues to review our work with Definers to understand what happened. Mark and Sheryl have also asked Nick Clegg to review all our work with communications consultants and propose principles and management processes to guide the team’s work going forward. We all want to ensure that we, our advisors and consultants better reflect Facebook’s values and culture.

Comment On The Memo From Sheryl Sandberg

Thank you for sharing this, Elliot.
I want to be clear that I oversee our Comms team and take full responsibility for their work and the PR firms who work with us. I truly believe we have a world class Comms team and I want to acknowledge the enormous pressure the team has faced over the past year.

When I read the story in New York Times last week, I didn’t remember a firm called Definers. I asked our team to look into the work Definers did for us and to double-check whether anything had crossed my desk. Some of their work was incorporated into materials presented to me and I received a small number of emails where Definers was referenced.

I also want to emphasize that it was never anyone’s intention to play into an anti-Semitic narrative against Mr. Soros or anyone else. Being Jewish is a core part of who I am and our company stands firmly against hate. The idea that our work has been interpreted as anti-Semitic is abhorrent to me — and deeply personal.

I know this has been a distraction at a time when you’re all working hard to close out the year — and I am sorry. As I said at the All Hands, I believe so deeply in the work we do and feel so grateful to all of you for doing so much every day. Thanksgiving seems like the right time to say a big thank you once again.

Facebook has other ties to Definers, the GOP-led opposition research group

Additional reporting by Taylor Hatmaker

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Facebook hires former UK Lib Dem leader, Nick Clegg, as global policy chief

Facebook has confirmed it has hired the former leader of the UK’s former third largest political party — Nick Clegg of the middle ground Liberal Democrats — to head up global policy and comms.

The news was reported earlier by the Financial Times.

Clegg is also a former UK deputy prime minister, after the Lib Dems entered government in the 2015 coalition with the Conservative party.

Facebook confirmed to TechCrunch that Clegg’s title will be VP, global affairs and communications, and that he starts on Monday — and will be moving with his family to California in the New Year.

Its prior global policy and communications chief, Elliot Schrage, who has been in post for a decade is staying on as an advisor, according to Facebook, and in a post announcing Clegg’s hire COO Sheryl Sandberg thanked Schrage for his “leadership, tenacity, and wise counsel ‑- in good times and bad”.

Facebook also told us that Sandberg and founder Mark Zuckerberg were both deeply involved in the hiring process, beginning discussions with Clegg over the summer — as fallout from the Cambridge Analytica data misuse scandal continued to rain down — and emphasizing they have already spent a lot of time with him.

The company also made a point of noting that Clegg is the most senior European politician to ever take up a senior executive leadership role in Silicon Valley. 

The hire certainly looks like big tech waking up to the fact it needs a far better relationship with European lawmakers.

Zuckerberg didn’t make any friends in Europe today

In a post on Facebook announcing his new job, Clegg says as much, writing: “Having spoken at length to Mark and Sheryl over the last few months, I have been struck by their recognition that the company is on a journey which brings new responsibilities not only to the users of Facebook’s apps but to society at large. I hope I will be able to play a role in helping to navigate that journey.”

“Facebook, WhatsApp, Messenger, Oculus and Instagram are at the heart of so many people’s everyday lives – but also at the heart of some of the most complex and difficult questions we face as a society: the privacy of the individual; the integrity of our democratic process; the tensions between local cultures and the global internet; the balance between free speech and prohibited content; the power and concerns around artificial intelligence; and the wellbeing of our children,” he adds.

“I believe that Facebook must continue to play a role in finding answers to those questions – not by acting alone in Silicon Valley, but by working with people, organizations, governments and regulators around the world to ensure that technology is a force for good.”

In her note about Clegg’s hire, Sandberg lauds Clegg as “a thoughtful and gifted leader who… understands deeply the responsibilities we have to people who use our service around the world” — before also discussing the big challenges ahead.

“Our company is on a critical journey. The challenges we face are serious and clear and now more than ever we need new perspectives to help us though this time of change,” she writes. “The opportunities are clear too. Every day people use our apps to connect with family and friends and make a difference in their communities. If we can honor the trust they put in us and live up to our responsibilities, we can help more people use technology to do good.

“That’s what motivates our teams and from all my conversations with Nick, it’s clear that he believes in this as well. His experience and ability to work through complex issues will be invaluable in the years to come.”

One former Facebook policy staffer we spoke to for an insider perspective on Clegg’s hire, couched it as a sign Facebook is finally taking Europe seriously — i.e. as a regulatory force with the ability to bring big tech to rule.

“When I started at fb there were two people in a Regus office doing EU policy,” the person told us, speaking on condition of anonymity. “Now they have an army, and they’re still hiring.”

In Europe, the region’s new data protection framework, GDPR, which came into force at the end of May, has put privacy and security at the top of the tech agenda. And more regulations are coming — with the EU’s data protection supervisor warning today that GDPR is not enough.

“The Facebook/Cambridge Analytica revelations are still under investigation in Europe and America, but they are only the tip of the iceberg, a sign of a much wider problem and a symptom of many more problems still unnoticed,” writes Giovanni Buttarelli in a blog entitled: The urgent case for a new ePrivacy law.

Reshaping regional rules to account for and rebalance monopolistic platform power is where EU lawmakers are increasingly turning their attention. It looks like Facebook has finally caught on that they’re serious.

“They didn’t take it seriously and they’re catching up now. I think it also just sends a strong signal that they’re not a U.S. centric company,” the former Facebooker added of the company’s attitude to EU policy, dating their dawning realization that a new approach was needed to around 2016.

That was also, of course, the year that domestic election interference came home to roost for Zuckerberg, after Kremlin meddling in the US presidential elections. And after his famous failure to judge that detail important.

So no more ‘pretty crazy ideas’ from Zuckerberg where politics is concerned — Nick Clegg instead.

For Brits, though, this actually is a pretty crazy idea, given Clegg is the awkwardly familiar face of middle ground, middler performance politics.

And, more importantly, the sacrificial lamb of political compromise, after his party got punished for its turn in coalition government with David Cameron’s Brexit triggering Conservatives.

Our ex-Facebooker source said they’d heard rumors linking the former Labour MP, David Miliband, and the Conservatives’ former chancellor, George Osborne, to the global policy position too.

Whatever the truth of those rumors, in the event Facebook went with Clegg’s third way — which of course meshes perfectly with the company’s desire to be a platform for all views; be that conservative, liberal and Holocaust denier too.

In Clegg it will have found a true believer that compromise can trump partisan tribalism.

Though Facebook’s business will probably test the limits of even Clegg’s famous powers of accommodation.

The current state of the Lib Dem political animal — a party with now just a handful of MPs (12) left in the UK parliament — does also hold a cautionary message for Facebook’s mission to be all things to all men.

A target some less machiavellian types might judge ‘mission impossible’.

Add to that, given Facebook’s now dire need to win back user trust — i.e. in the wake of a string of data scandals, such as the Cambridge Analytica affair (and indeed ongoing attempts by unknown forces to use its platform for voter manipulation) — Clegg is rather an odd choice of hire, given he’s the man who led a political party that fatally burnt the trust of its core supporters and convinced them to punish it with near political oblivion at the ballet box.

Still, at least Clegg knows how to say sorry in a way that be turned into a hip and shareable meme …

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Facebook’s longtime head of policy and comms steps down

A prominent figure that helped shape Facebook public perception over the course of the last decade is on the way out. In a Facebook post today, Elliot Schrage, vice president of communications and public policy, announced his departure.

Schrage joined the company in 2008 after leaving his position in the same role at Google. He had come under fire over the last year at Facebook for his influence in shaping Facebook’s highly criticized public reaction to a series of scandals that began with the platform’s policies during the 2016 U.S. presidential election. In response to questions about Facebook’s potential unwitting role in influencing the outcome of the election, Mark Zuckerberg famously dismissed such concerns as a “pretty crazy idea.”

via Facebook/Elliot Schrage

In a Facebook post, Schrage elaborates:

After more than a decade at Facebook, I’ve decided it’s time to start a new chapter in my life. Leading policy and communications for hyper growth technology companies is a joy — but it’s also intense and leaves little room for much else. Mark, Sheryl and I have been discussing this for a while. I’ll lead the search to identify someone new to oversee our communications and policy teams. We expect to find someone with the same passion, integrity, determination and energy that our teams bring to Facebook every day. Mark and Sheryl have asked me to stay to manage the transition and then to stay on as an advisor to help on particular projects – and I’m happy to help.

Earlier this week, Schrage reportedly apologized for comments made in response to questions from Arjuna Capital Managing Partner Natasha Lamb during an investor meeting. Lamb inquired about Facebook’s plans to correct its gender pay gap among other uncomfortable lines of questioning for the company. Schrage reportedly told Lamb that the company would not answer her questions because she was “not nice.” It’s not clear if that event influenced the timing of Schrage’s departure.