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This is literally textbook how-to-do business, if the fines are smaller than what you earn from doing it, you keep doing it because it's profitable. It's why F

This is literally textbook how-to-do business, if the fines are smaller than what you earn from doing it, you keep doing it because it's profitable. It's why Facebook's $5bn FTC fine is laughable too. You need to fine them an amount relative to their market capitalization to really make 'em feel it, probably around 10%. I'd go as far to say, one would need fine them in the $50-$100bn range to really stop them from doing something (same for any of the $500bn+ companies). If it's profitable to be shitheads, they're are going to account for it, and be shitheads.

utopcell 7y ago
FB's net profit for Q2 was $1.6bn. Close to a year's profits were wiped out from this fine, which is roughly 1% of Switzerland's GDP. I don't see how this is laughable. A fine of 10% of market cap is close to the company's gross revenue. This is equivalent to a government owning the company. This "smells" like communism mentality.
- rubyn00bie 7y ago
  How is fining them an amount large enough to deter their behavior communism? Full stop, how? What you're saying is that fines large enough to actually affect the company, to make their shareholders realize a loss of (monetary) value as a result of bad management, is communism? That to me is simply insane, and I'd highly encourage you to go take some upper division economics courses before rattling off what is and isn't communism.
  - javagram 7y ago
    $5 billion is an enormous fine even for someone on the scale of Facebook. The idea that it won’t have any effect on Facebook’s behavior in the future is laughable.
    - scarface74 7y ago
      Why would it? Facebook is a public company but Zuckerberg has a controlling interest. FB does whatever he wants them to do.
      - javagram 7y ago
        Zuck is pivoting the company to privacy. https://m.facebook.com/notes/mark-zuckerberg/a-privacy-focused-vision-for-social-networking/10156700570096634/ https://m.facebook.com/notes/mark-zuckerberg/a-privacy-focus... He loves money just as much as everyone else.
  - utopcell 7y ago
    It's quite simple: 1. FB's market cap is $573bn. 10% is $57.3bn. 2019 Q2 profits were $1.6bn. 2. By your standards, it is perfectly fine for a government [entity] to tell a private company: "If you don't do exactly as I ask, I will get all your profits for roughly the next decade." That, according to you, would be teaching FB "good behavior." To quote you, it will "really make 'em feel it". 3. Communism is a system of government in which the state plans and controls the economy and a single -- often authoritarian -- party holds power. Maybe you should rethink your views.
    - ocdtrekkie 7y ago
      I mean, I think the parent's position is generous, considering what I think many others would agree would be fair: That a company that has wronged a country's citizens as deeply as the Facebooks and Googles of the world have should simply be terminated, executives jailed, and assets seized and either auctioned or redistributed. For companies built on societal harm, they should have to fight for their lives to remain in business. If we want these sorts of businesses/behaviors to stop cropping up, we need to make societal harm a huge risk factor for investors.
      - utopcell 7y ago
        Sure. Some may even find your stance too sympathetic. There are countries where, today, executives would be jailed or executed for the harm they've brought upon their users. Such insane views are the norm for other countries, but not for a democratic country like the US. What was FB's crime again, that deserves for it to be wiped off the face of the planet ? Of course it is perfectly fine and within your rights to believe and say that the world would be better off without FB (and Google no less!) but you must understand by now that your opinion is that of a tiny minority. To answer in good faith however: I do agree with the spirit of what you are saying. Companies should be held accountable and fines are probably a good tool to achieve that.
    - rubyn00bie 7y ago
      1. And? This has nothing to do with anything I talked about you're just stating facts without a point. 2. If you're only looking at profits, then you're missing the entire point of running a business like Facebook, because that's not the point. The point is to increase shareholder value whether that's actual profit, or an increasing stock value. To only look at their profit, which can be easily manipulated with GAAP accounting, is pretty much negligence. Look at Amazon choosing to run in the red for decades... 3. Communism isn't a system of government. It's an economic system, that is to say a system for managing resources. QED P.S. One last thing, you work at Google, of course you're going to be against these fines or proposing them.
gesman 7y ago
No one is interested in this. The amount of fines are balanced to ensure: - minimal legal pushback from FB side - quick pay. - make sure it's repeatable process (i.e. FB do what they want to generate revenues. FTC succeeds in fining FB with accompanying political wins, bonuses and promotions that somes with it) Rinse and repeat.

utopcell 7y ago

FB's net profit for Q2 was $1.6bn. Close to a year's profits were wiped out from this fine, which is roughly 1% of Switzerland's GDP. I don't see how this is laughable. A fine of 10% of market cap is close to the company's gross revenue. This is equivalent to a government owning the company. This "smells" like communism mentality.

rubyn00bie 7y ago
How is fining them an amount large enough to deter their behavior communism? Full stop, how? What you're saying is that fines large enough to actually affect the company, to make their shareholders realize a loss of (monetary) value as a result of bad management, is communism? That to me is simply insane, and I'd highly encourage you to go take some upper division economics courses before rattling off what is and isn't communism.
- javagram 7y ago
  $5 billion is an enormous fine even for someone on the scale of Facebook. The idea that it won’t have any effect on Facebook’s behavior in the future is laughable.
  - scarface74 7y ago
    Why would it? Facebook is a public company but Zuckerberg has a controlling interest. FB does whatever he wants them to do.
    - javagram 7y ago
      Zuck is pivoting the company to privacy. https://m.facebook.com/notes/mark-zuckerberg/a-privacy-focused-vision-for-social-networking/10156700570096634/ https://m.facebook.com/notes/mark-zuckerberg/a-privacy-focus... He loves money just as much as everyone else.
- utopcell 7y ago
  It's quite simple: 1. FB's market cap is $573bn. 10% is $57.3bn. 2019 Q2 profits were $1.6bn. 2. By your standards, it is perfectly fine for a government [entity] to tell a private company: "If you don't do exactly as I ask, I will get all your profits for roughly the next decade." That, according to you, would be teaching FB "good behavior." To quote you, it will "really make 'em feel it". 3. Communism is a system of government in which the state plans and controls the economy and a single -- often authoritarian -- party holds power. Maybe you should rethink your views.
  - ocdtrekkie 7y ago
    I mean, I think the parent's position is generous, considering what I think many others would agree would be fair: That a company that has wronged a country's citizens as deeply as the Facebooks and Googles of the world have should simply be terminated, executives jailed, and assets seized and either auctioned or redistributed. For companies built on societal harm, they should have to fight for their lives to remain in business. If we want these sorts of businesses/behaviors to stop cropping up, we need to make societal harm a huge risk factor for investors.
    - utopcell 7y ago
      Sure. Some may even find your stance too sympathetic. There are countries where, today, executives would be jailed or executed for the harm they've brought upon their users. Such insane views are the norm for other countries, but not for a democratic country like the US. What was FB's crime again, that deserves for it to be wiped off the face of the planet ? Of course it is perfectly fine and within your rights to believe and say that the world would be better off without FB (and Google no less!) but you must understand by now that your opinion is that of a tiny minority. To answer in good faith however: I do agree with the spirit of what you are saying. Companies should be held accountable and fines are probably a good tool to achieve that.
  - rubyn00bie 7y ago
    1. And? This has nothing to do with anything I talked about you're just stating facts without a point. 2. If you're only looking at profits, then you're missing the entire point of running a business like Facebook, because that's not the point. The point is to increase shareholder value whether that's actual profit, or an increasing stock value. To only look at their profit, which can be easily manipulated with GAAP accounting, is pretty much negligence. Look at Amazon choosing to run in the red for decades... 3. Communism isn't a system of government. It's an economic system, that is to say a system for managing resources. QED P.S. One last thing, you work at Google, of course you're going to be against these fines or proposing them.

gesman 7y ago

No one is interested in this. The amount of fines are balanced to ensure: - minimal legal pushback from FB side - quick pay. - make sure it's repeatable process (i.e. FB do what they want to generate revenues. FTC succeeds in fining FB with accompanying political wins, bonuses and promotions that somes with it) Rinse and repeat.