11 ms·
These numbers should be written as "hours of revenue". Then people would notice how laughably small those fines are. > Meta was fined 12 hours of revenue for
by meghan_rain 3y ago
These numbers should be written as "hours of revenue".
Then people would notice how laughably small those fines are.
> Meta was fined 12 hours of revenue for violating your fundamental human rights for years of profit.
- toth 3y agoWhile I don't disagree with you, if you are going to say something like you should really at least give the right number. Or at very least include a disclaimer that 12 hours is not the right number. 2022 Meta revenue was 116 billion USD [1]. So the fine was 1.1% of yearly or revenue, or pretty close to 4 days of revenue. In terms of yearly net income, it is 5.6% or 20 days of income. Don't think this is a trivial fine. [1] https://www.statista.com/statistics/277229/facebooks-annual-revenue-and-net-income/ https://www.statista.com/statistics/277229/facebooks-annual-...
- vmfunction 3y ago1.1% seems like slap on the wrist or cost of doing shady business. 20% would be more appropriate, then again this seems like political discussion between US and EU.
- microtonal 3y agoThe fines can be up to 4% of global yearly turnover. I think they don't go for the full amount immediately, because you always want to have room to increase the penalty if the don't comply after this fine.
- Yujf 3y agoReminder that this is revenue, not profit AND it is a fine from the EU so really only EU revenue should be counted when discussing how hard this hits Meta.
- johannes1234321 3y ago> a fine from the EU so really only EU revenue should be counted You can't really fully seperaten EU revenue. I as a European write very intelligent and relevant posts on Facebook, thus people from other regions go there to read them. (well, I don't post anything on Facebook these days, but the point stands)
- cheriot 3y agoMeta revenue is from showing an ad. "Is the ad shown in the EU?" seems like a pretty clear line. IFRS rules already require tracking the action that recognizes revenue so seems hard to play games with it.
- ndr 3y agoThis implies that Meta doesn't make money outside of EU by exfiltrating EU users' data. If Meta made zero money in EU whilst still offering a service to EU users, and still exfiltrating their data, should the fine be zero?
- ben_w 3y agoEven if the calculations for how to attribute income from different places would be difficult to decide upon precisely, and doubly so if the calculations are used to determine a penalty fine thanks to the possibility of being gamed, it can probably be guessed at without too much error in cases where Goodhart's Law doesn't bite.
- cheriot 3y agoHow does anyone make money with EU data outside the EU? Seems like the value of that data is trivial anywhere else.
- nicce 3y agoIt should hit the global revenue. Otherwise they could play even more regionally with the rules, and fines are just a cost of doing the business.
- andrewinardeer 3y agoAgree. A few years ago I was on around AUD90,000 and driving my wife's car which to me she had failed to register. I got a AUD990 fine. So I equate this fine to Meta getting busted for driving an unregistered car. Not even close to a drink driving charge.
- anpe 3y agoAlso to add, this fine is concerned with the EU. I'm not sure why we care how much money Meta makes in other regions. EU accounts for about 25% of their revenue [1]. So in terms of yearly net income it then gets closer to about 15%. Again, the job of EU is to regulate businesses in the EU and not the rest of the world. [1] https://businessquant.com/facebook-revenue-by-region https://businessquant.com/facebook-revenue-by-region
- arlcode 3y agoThe GDPR allows for fines based on global revenue to prevent companies playing games with where there income is "technically" generated.
- bboygravity 3y agoSounds to me like a clever EU work-around to force Meta to pay taxes over its EU revenue :p This "fine" just feels like "cost of doing business in the EU" to me...
- johannes1234321 3y agoThey got 5 months to fix the issues. So after 5 months they can collect a bigger fine ... and then 5 months later again, with three increasing charges within 12 months it's more notable. Ok, realistically it's unlikely to happen exactly that way, ...
- pyrale 3y agoFortunately, we can count on FB to move fast and break this hazard much faster than that.
- nirimda 3y agoWell, companies are known for organising their affairs to avoid taxes. I suppose they can organise their affairs to avoid fines as well.
- 3y ago
- toxik 3y ago20 days of income for this seems extremely low. Were it a person, they would have been jailed and indebted for life.
- EduardoBautista 3y agoNo, they wouldn't. An appropriate fine would have been given to a sole proprietor.
- TeMPOraL 3y agoNot really. The EU isn't trying to kill Meta, it's trying to get it to follow GDPR where it applies. For most people, fining them an equivalent of their monthly salary, is a blow painful enough the person won't forget it soon, and will try to avoid getting fined again.
- JCWasmx86 3y agoYeah agreed. They will simply continue to violate the GDPR. If the last years global revenue was 116 Billion USD, the fine should be at least 200 Billion. Otherwise companies just will see the fine as cost of doing business.
- trogdor 3y agoWhether something is a 'cost of doing business' is based on whether the cost is expected or unexpected, not its magnitude.
- ChatGTP 3y agoBit off topic, but how on earth did Meta gross 116 billion USD ? lol Of course we all find tech valuable, but that is absolutely stupid money for what I get out of their services, which is almost nothing hence I've not opened FB for weeks and I open Instagram for 2-3 minutes every day and turn it off, lately maybe every other day. Even with more engaged users it's hard to believe it's worth that much money. Is the advertising really this effective ? Insane.
- ndsipa_pomu 3y agoI would guess that a chunk of income comes from selling datasets to interested parties, especially politically affiliated ones e.g. https://en.wikipedia.org/wiki/Facebook%E2%80%93Cambridge_Analytica_data_scandal https://en.wikipedia.org/wiki/Facebook%E2%80%93Cambridge_Ana...
- ChatGTP 3y agoThat's nice and terrifying then.
- aierou 3y agoMeta only lost income and credibility from that scandal, unless you believe the data breach was conspiratorial.
- ndsipa_pomu 3y agoSeems likely to me. I can't recall Facebook acting in good faith at any point in time. If there's a bunch of money to be made assisting well-funded politicians, then I'd fully expect Facebook to be wanting a piece of that pie when their business model is generally to act against the users of the site by selling their data to manipulators.
- loeg 3y agoYour guess is wildly mistaken. They did not intend to sell data to CA; and the CA events happened in 2014-2015 and the program CA abused was subsequently shut down.
- rmm 3y agoWasn’t the fine for breaches since July 2020? So more like 2 days revenue and like 3%profit. Actually meta had bigger year last year so a bit less than that. Cost of business ?
- nicce 3y agoThe investigation lasted 10 years. https://noyb.eu/en/edpb-decision-facebooks-eu-us-data-transfers-stop-transfers-fine-and-repatriation https://noyb.eu/en/edpb-decision-facebooks-eu-us-data-transf... So, the fine is ridiculously low. 130 million per year?
- blitz_skull 3y agoOkay am I insane or does “20 days of income” for a company that generates income 24/7 seem like the definition of a “trivial fine”?
- loeg 3y agoIt doesn't seem like the definition of "trivial fine," no.
- chias 3y agoGiven that you are on HN, you are likely salaried employee. This means you are also generating income 24/7. If you were fined for 20 days of your income, would you still argue that this is "the definition of a trivial fine" for you? I certainly wouldn't.
- blitz_skull 3y agoI mean given the context we’re talking about? That’s absolutely trivial. A 20-operating-days fine wouldn’t touch my day-to-day life, I wouldn’t have to alter my behavior going forward at all, there would be almost 0 repercussions. Would I enjoy it? Certainly not. Would I change my behavior if it was generating billions in revenue? Certainly not. How is this supposed to dissuade FB at all?
- whimsicalism 3y agoNietzsche wrote about this stuff, doubt there is any magnitude of fine that would be acceptable to the baying masses.
- hartator 3y ago4 days is actually pretty high.
- cromka 3y agoRevenue tells you nothing in terms of how severe that fine is. As others pointed out, it should be in relation to net income.
- xerxesaa 3y agoNot sure net income would tell you that much either. Many companies deliberately keep net income low by reinvesting in further growth. Think of Amazon's model. At least revenue gives you a sense of the upper limit.
- Algent 3y agoAgreed, fine on net income is meaningless it just mean it won't hurt. Should be at least 10% of revenue like antitrust tend to do, this would make anyone think twice.
- coffeebeqn 3y agoBut revenue has even more issues. You’ll end up hurting low margin companies the most. If my company transacted $1T in some boring business model that netted a few million to the company coffers and employee pay then fining me on the $1T would simply wipe the company out many times over
- JustFinishedBSG 3y agoSo Amazon can just say "fuck the law" and get negative fines ? It obviously doesn't work.
- mattigames 3y agoWell, one could say that that is a problem about how Amazon is allowed to use some shady accounting tricks to declare low net income, and therefore that problem is the one that should be addressed directly.
- avianlyric 3y agoI don’t think GP is suggesting that the fines should be calculated based on net income. Just that you should evaluate the _impact_ by comparing to net income. So in Amazons case you absolutely see a fine greater than their net income, but still only 1% of their revenue, and obviously such a fine would have a greater impact on Amazon than the equivalent 1% fine applied to Facebook.
- deleted 3y ago[deleted]
- gavaw 3y agoYou can't just attach the "human rights" magical pixie dust to anything to make it more serious. Oh wait you said fundamental human rights.
- cccbbbaaa 3y agoPrivacy is a human right in the EU.
- gavaw 3y agoHaving the datacenter that stores your data in another region does not affect your privacy in any way.
- tchaffee 3y agoThat's wrong. A data center in the US can be forced to hand the data over to the government. And that's not the only protection you lose.
- gavaw 3y agoIt's very naive to think moving the datacenter to the EU makes it impossible for American agencies to data off it.
- tchaffee 3y agoI never made any such claim that it would be impossible. Your initial claim is still wrong.
- cccbbbaaa 3y agoThat's exactly why the privacy shield was invalidated by the CJEU.
- lmm 3y agoMoving the datacenter to the EU makes it a crime; we can at least impose diplomatic sanctions as and when we catch foreign spies doing crimes in the EU. If the datacenter is in the US then there's no recourse.
- m_eiman 3y agoAnother way to seek it is: $2 per EU citizen.
- TeMPOraL 3y agoSure, but let's also add a reminder that the point of the fine isn't to torture or kill the company - it's to incentivize it to comply with the law. Whatever ills people may ascribe to Meta, EU DPAs aren't in the business of social activism, or taking their annoyance out on multinational corporations. The job is to get Meta to comply with GDPR. If that fine will do the trick, mission accomplished. If it won't, the next one will be bigger, and then fining will continue until compliance improves. (There's a sub-story here about Irish DPC, but that's orthogonal to the size of GDPR fines issued.)
- fauxpause_ 3y agoThey should be written as a % of profit from the area generating the fine
- detaro 3y agoGiven the creativity in accounting possible for multinationals and the difficulty in capturing value added to other areas from activities in an area that's a number with very little actual value.
- fauxpause_ 3y agoThe accounting is not what matters. What matters is using your brain to to figure out if a fine is actually meaningful. Comparing to revenue is a stupid way to think about things. Profit is the incentive to conduct business. Not revenue. And not global profit, but in this case Ireland/EU profits only, because that is the location fining them. People are so eager. Every. Single. Time. To say that a fine does not matter even if it clearly outpaces multiple years of profits for the area given.
- Spivak 3y ago> Comparing to revenue is a stupid way to think about things. Profit is the incentive to conduct business Because it is and it isn't. Companies can make people filthy rich while not making a single dollar of profit thanks to the stock market where the price does grow, broadly, in terms of revenue.
- fauxpause_ 3y agoYou’re right in that it ought to be compared to the scale of profits, not a percentage, as many run on a loss during growth. But profit is still what matters. Including the promise of future profits. Talking of the future doesn’t help much because both numbers will change. And punishing a company based on its future state is… not possible
- ilyt 3y ago
- nologic01 3y agoThere are two aspect to this, the message to the company and the message to the users: Yes, the fines are small enough that they are normalized by the violating corporate as just as small additional cost of doing business. A dramatic negative externality gets trivialized. The signal to other corporates is: go ahead feasting on the corpse of user privacy, just do a proper cost-benefit analysis. But, these fines are legal events, in jurisdictions that are relevant to large numbers of people. The common argument "people don't care about privacy" is more truthfully "people assume that widely popular online businesses are legal and ok, since services that are not ok are generally not allowed to operate". In fact, when all sort of public institutions are actually on facebook (and other adtech platforms) and even encourage people to join and interact there, they actually endorse that implied legal status. This has been a fiasco that has cut to size any "proud" democracy out there. News headlines of legal fines help puncture that implied institutional endorsement. The average user doesn't know that the fine is just 12 hours of revenue. They actually have no clue what sort of lucrative business is running behind their backs and against their interests. Using these legal events, provided they get some press, does help the argument of those pushing to use (where available) privacy-respecting alternatives. Of course such is the ability of the public to get desensitized to any uncomfortable truths that eventually that effect will wear out too.
- ilyt 3y ago> Yes, the fines are small enough that they are normalized by the violating corporate as just as small additional cost of doing business. A dramatic negative externality gets trivialized. The signal to other corporates is: go ahead feasting on the corpse of user privacy, just do a proper cost-benefit analysis. Non-compliance just causes another fine. So they could be up to 8% of turnover (not income) a year
- hfkwer 3y agoI am getting tired of always reading this same old tune. It's damned if you, damned if you don't. - EU fines a company a small percentage of its annual revenue. "Laughably small", "cost of doing business", EU has no fangs, blablabla. - EU fines a company a large percentage of its annual revenue. Damn EU bureaucrats, trying to make money on the back of hardworking US multinationals, zero innovation over there so they steal from America, blablabla. What do you want? For the EU to impose such large fines that they put every tech company out of business? No one wins at that game.
- bcrosby95 3y agoHN isn't a monoculture. Different people have different opinions.
- pyrrhotech 3y agoHN may be slightly better than other platforms, but it's still largely an echo chamber
- davidktr 3y agoI, too, voice my opinion each day on platforms where everyone disagrees with me.
- loeg 3y agoIt's even worse than that -- you'll get both opinions on the same fine. Can't please everybody.
- lopkeny12ko 3y agoYou realize how silly this would be right? If you got a parking ticket, how would you feel about being fined some % of your monthly paycheck instead of a flat $50?
- Broken_Hippo 3y agoLike it is more fair. Why should a poor person pay nearly a day's wages for a violation when other people don't have to have such a harsh punishment? Does it seem ridiculous at the edges? Sure, but it also makes the fine an actual punishment for all rather than a rule that the better off can afford to ignore. This is true even in the case of driving laws. Sure, you might lose your license regardless of finances - but only one of them can fairly easily afford the reinstatement fees and the extra costs of not driving.
- gen220 3y agoNot sure if you're aware, but some fines in some jurisdictions actually work this way [1]. [1]: https://www.euronews.com/2023/01/04/finlands-progressive-punishment-when-it-comes-to-speeding-tickets#:~:text=Generally%2C%20it's%20their%20daily%20salary,is%20higher%2C%22%20another%20said https://www.euronews.com/2023/01/04/finlands-progressive-pun....
- thunkshift1 3y agoRevenue is not the same as profit.. this fine is coming out metas income
- danbrooks 3y agoIs this comment GPT generated (following the description in meghan_rain's bio)?
- pyrrhotech 3y agoIt's amazing to me how many otherwise intelligent people on HN inevitably make this same comment, when in fact, this is a substantial fine even to a company the size of Meta. Much higher would be borderline extortion, and Meta would seriously start to consider whether doing business in the EU is worth it.
- benced 3y ago"Fundamental human right" is a pretty high bar and it's lazy to just throw it out there without any evidence. The UDHR (https://www.un.org/en/about-us/universal-declaration-of-human-rights https://www.un.org/en/about-us/universal-declaration-of-huma...) has it stated as "[n]o one shall be subjected to arbitrary interference with his privacy". Is signing up for an American company's service and being surprised they send information to the US really arbitrary? Maybe it is (or maybe folks disagree with the UN on privacy) but people should actually make that case instead of treating it as self-evident.