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Zuckerberg faces more Cambridge Analytica questions from Congress

Facebook CEO Mark Zuckerberg

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If you needed a reminder that Facebook is a company built on making money from advertising — a firm that relies on you as the product — an exchange between CEO Mark Zuckerberg and New Jersey Rep. Frank Pallone underscored the point. Near the start of Wednesday’s congressional hearing, Pallone asked Zuckerberg why Facebook didn’t just create all users’ default settings to minimize data collection.

Pallone asked if Zuckerberg would commit to that with a “yes” or a “no.” “That is a complex issue that deserves more than a one word answer,” Zuckerberg responded.

Zuckerberg went to Washington to face lawmakers, to apologize for Facebook’s recent missteps and to support (some) regulation of a tech industry that’s operated for years with little government oversight. On his first day of testimony, Tuesday, he met a room full of senators who struggled to understand what Facebook does, how the social platform works, and how to regulate it.

But Zuckerberg’s hearing Wednesday before the US House of Representatives’ Energy and Commerce Committee was defined by pointed questions from lawmakers who appeared to have done their homework on the company. Some, like New Jersey Rep. Frank Pallone, hammered Zuckerberg on default privacy settings. California Rep.

Anna Eshoo asked Zuckerberg if his own data was affected by the Cambridge Analytica scandal. He revealed that it was. And Florida Rep.

Kathy Castor raised concerns about how much Facebook’s systems follow people as they browse the web, whether or not they’re logged in or even have an account. Zuckerberg, who escaped unscathed from the nearly four dozen senators he faced for five hours on Tuesday, settled into his roll as both an explainer of technology and receiver of the occasional finger-wag.

Zuckerberg also spent his time attempting to shore up Facebook’s image by explaining how he plans to tighten data policies, protect users from further leaks and become more transparent about who’s advertising on his site. He also tried to rebuild users’ trust.

“We didn’t take a broad enough view of our responsibility, and that was a big mistake. It was my mistake, and I’m sorry.” Zuckerberg said, repeating what’s become his mantra through his apology tour (he delivered the same line Tuesday). “I started Facebook, I run it, and I’m responsible for what happens here.” On Tuesday, Zuckerberg, 33, entered the hearing room tense and nervous, as he typically is, having traded his T-shirt and hoodie for a dark blue suit and blue tie.

By Wednesday, the CEO appeared calm. His deer-in-the-headlights stare was gone, his shoulders were relaxed, and he didn’t sweat profusely under pressure. He didn’t appear to egregiously offend any of the lawmakers, either.

That all adds up to Zuckerberg likely to squeak by his first series of hearings on Capitol Hill without many repercussions. Quite the opposite, Senator Lindsey Graham, among others, asked him to help write legislation in the future. Facebook shares on Wednesday built on the previous day’s gains.

By midday Wednesday, Facebook shares had risen nearly 2 percent to £166.86, after a 4.5 percent rise the day before. “He appeared focused, conciliatory and genuinely engaged in a productive discussion with legislators,” said Wells Fargo analyst Ken Sena, of Zuckerberg by the end of testimony Tuesday. “This as a positive sign.”

I started Facebook, I run it, and I’m responsible for what happens here.

Mark Zuckerberg’s mantra during his apology tour

As a result, the Senate hearing came to a detente after Senators exposed themselves as not informed enough to take on Facebook seriously, and Zuckerberg wasn’t going to win too many of them to his side anyway. His hearing with the House was more productive, with representatives asking detailed and thoughtful questions.

New Jersey Rep. Frank Pallone was among the first to dive in, classifying Facebook as yet another company that “vacuum[s] up our data but fail[s] to keep it safe.” During the questioning, New Mexico Rep.

Ben Lujan asked why, after being warned for years, Facebook took so long to respond to threats from people trying to steal user’s profile information. Then, he asked how many data points Facebook collects on non-users and how someone who doesn’t have a Facebook account can opt out of its data collection, to which Zuckerberg didn’t respond. “Your business is built on trust, and you’re losing trust,” Lujan said.

In terms of how Facebook and other companies could be potentially regulated, California Rep. Raul Ruiz asked Zuckerberg if it would be helpful if there existed some entity to oversee how consumer data is used, and created guidelines companies could follow. Zuckerberg said the idea deserved consideration.

Representatives like Michigan’s Fred Upton raised questions about Facebook’s dominance. While Zuckerberg would respond that the average person uses about eight apps to communicate, an June 2017 report from comScore shows Facebook owns three of the apps in those top 8, including Instagram, Facebook and Messenger. After the hearing, Rep.

Pallone described the situation like this: “All these people have an expectation of privacy [on Facebook], and it doesn’t exist.”

Zuckerberg faces more Cambridge Analytica questions from Congress

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Only some did homework

Facebook’s shares began their rise Tuesday shortly after Zuckerberg’s first hearing, with the Senate, began. What drove the shares higher isn’t clear, but it was likely when investors realized many senators barely understood the technological issues they were attempting to grill Zuckerberg on. And unlike the House hearing, in which almost all members appeared well prepared and briefed on the issues, the Senate’s questions came down to a mishmash of mostly inane questions, with a few diamonds in the rough.

The hearing started with pointed and sometimes uncomfortable questions about fundamental ways Facebook protects user data, including a key moment in which Sen. Dick Durbin asked whether Zuckerberg would reveal to all the participants what hotel room he’d stayed in. After Zuckerberg awkwardly said “uhhhh… no,” Durbin made a point about the importance of privacy. But then the questions just got weirder.

Sen. Orrin Hatch asked how Facebook makes money (Zuckerberg: “Senator, we run ads.”) Sen. Roy Blunt didn’t seem to understand how apps get access to information on people’s phones. And Zuckerberg spent time explaining that Facebook couldn’t read messages in its WhatsApp messenger because they’re encrypted. “These senators are struggling with the role of technology and how it works, and more importantly, how what Facebook does really creates this environment where advertising is critical to its success,” said Tim Bajarin, president of Creative Strategies. “They don’t understand how Facebook really works.”

CNET’s Richard Nieva contributed to this report. Updated at 7:46 a.m. PT: Adds Zuckerberg himself was affected in Cambridge Analytica scandal.
Updated at 7:29 a.m.

PT: Adds additional quote from Rep. Pallone.
Updated at 7:18 a.m. PT: Adds quote from Rep.

Pallone.
Updated at 9:53 a.m. PT: Adds quote from Rep. Castor and Lujan.
Updated at 11:14 a.m.

PT: Adds quote from Rep. Ruiz.
Updated at 12:27 p.m. PT: Adds quote from Rep.

Pallone.
Updated at 1p.m.

PT: Adds comScore information.

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