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TECHNOLOGY

As Facebook Works on Damage Control, Some Businesses Are Hung Out to Dry

In the wake of the Cambridge Analytica scandal, Mark Zuckerberg’s company is actively restricting access to its users’ data.

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BY Guadalupe Gonzalez - 07 Apr 2018

PHOTO CREDIT: Getty Images

Facebook is quickly becoming a prolific purveyor of modern cautionary tales for entrepreneurs. In the last few weeks, it has provided lecture-worthy examples in crisis management, public relations, customer service, and product development. For its latest lesson, the message is loud and clear: Be wary of building your business on top of someone else's proprietary tech.

On Wednesday, after admitting that its system could have allowed "malicious actors" to gather data on most of its 2 billion users, Facebook opted to immediately remove access to several sets of data previously accessible to developers via Instagram and Facebook's APIs. This disrupted a trove of businesses offering analytics and social media listening tools, leaving their owners to fend off customers' complaints without any advanced notice.

The social media giant has been struggling to recover from an unrelenting backlash following the revelation that Cambridge Analytica, a data analytics firm with ties to the Trump campaign, had access to what now appears to be 87 million users' information, without their consent. The expos has put Facebook's data sharing policies and practices under severe scrutiny. Founder Mark Zuckerberg is expected to testify before Congress on Tuesday to address these issues.

"They know that they got in trouble and here he is playing damage control," says Jason Urgo, founder of analytics company Social Blade, who describes Zuckerberg as "overreacting" in abruptly cutting off access to all third parties.

Urgo's business lets people gauge users' popularity across several social platforms for free, including YouTube, Twitter, Twitch, and Instagram. Among other metrics, it shows a user's follower count, how quickly the account gains new followers, and how many posts have been published. Social Blade's website is viewed roughly 110 million times per month. As of Thursday, as a result of the new restrictions, Urgo was forced to stop offering Instagram analytics, which was his second most popular product.

"At least in the data that we provide, I honestly don't see any privacy issues with it," he says, explaining his product only accessed follower, following, and post count information. All of these are available to anyone browsing Instagram, even if you are not logged in to an account or the profile is set to private. "Unless they're planning on removing that too, I don't see any privacy issues with that," he adds.

For many young businesses, using another company's tech to build their products makes financial sense, particularly when resources are limited. Indeed, the idea behind APIs, which stands for application programming interface, is to supply developers with a common framework on top of which they can create new software applications, as opposed to starting from scratch. Most tech companies, including Google, Apple, Amazon, and Microsoft, offer API kits on their websites.

To be sure, Facebook had previously warned developers of its plans to modify Instagram's API platform, which would have shut down access to many existing datasets in July of this year and end support entirely in 2020. The changes implemented Wednesday accelerated the timeline instantly.

There are still some functions available from the old platform, however, such as the ability to read public media on behalf of a user or to read a user's own media statistics, although the number of requests (the number of times your app accesses Instagram's data, useful for real-time updates) has been reduced to 200 from 5,000. The new Instagram API platform provides insights for business profiles only. All apps that wish to use Facebook or Instagram's APIs going forward will have to submit to a formal review and be approved by the company.

"They flipped the switch very suddenly on them," says Nick Johnson, co-author of the book Modern Monopolies and head of platform at Applico, an advisory company for platforms. "Ideally what you'd want to do, what a lot of these app developers would've liked, is give them the time and they can re-write their apps to make much less frequent API requests."

Some business owners who rely on these tools may consider hiring people to get the data manually. Such is the case of Devon Zdatny, founder of First & First Consulting. Her company uses the information to provide brand insights and inform her clients' marketing strategies. "Social analytics is pretty core to how we understand the positioning of a brand, to the culture that fuels the consumers' lives," she says.

Gathering the data, which used to cost about $30 via tech tools, will now take about 20 to 30 hours of an intern's time, she estimates. "It's having to replace what should be able to be handled with technology by human labor."

A number of business owners that Inc. spoke to are sympathetic to Facebook's current situation. Urgo believes the shutdown is mostly a temporary, albeit drastic, measure to regain public's trust in the wake of the Cambridge Analytica scandal.

"I'm hoping we'll be able to resume in some form in the future, working with whatever new guidelines they have," he says.

It could take a while before that happens, however. While the exact number of apps and developers using Facebook or Instagram's API is not publicly available, it's not unreasonable to assume it is probably huge. According to Facebook, its Graph API served an average of 1.2 trillion API requests per day as of April 2017. At the time, Facebook still hadn't crossed the 2 billion users mark.

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