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Warning from Facebook Stock Drop: Take Privacy Seriously!

Facebook’s substantial stock drop following its earnings announcement and conference call is a clear message to every large corporation that they need to take privacy seriously.

The stock market has been open for about two hours this morning and Facebook shares are down roughly 19% from the closing price yesterday. If the stock closes around these levels, it will be the largest one day loss of shareholder value in history.

One of the factors at the heart of Facebook’s fall after its Q2 earnings for 2018 is the Cambridge Analytica scandal and GDPR. Facebook lost one million monthly active users in Europe as a result of it. Facebook also was unable to gain consent for personalized ads for a portion of its users.

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Facebook has been ignoring privacy issues for the past decade and it is now feeling the consequences. It must engage in education about the new privacy settings, capture additional permissions from users, and combat the negative media publicity as a result of the Cambridge Analytica scandal. These efforts are more costly and distracting then if Facebook had been taking privacy seriously from the beginning.

Businesses need to take this lesson to heart. If they attempt to put off addressing the data privacy of their users, it is going to one day result in a significant setback for the business.

Investors are looking for companies that make positive progress and deliver quarter after quarter. Instead, the privacy issues have made Facebook investors extremely nervous. Twice this year there have been substantial one day stock price drops due to privacy issues.

Facebook is now attempting to make the investments that are needed in privacy and security in order to correct its problems. Is your company?

Many businesses are unfortunately still not taking action to address the substantial privacy problems that are plaguing companies. An International Association of Privacy Professionals on How Privacy Tech is Bought and Sold found that most privacy offices report an inadequate budget. This is particularly a problem among American companies.

If companies don’t allocate the budget to acquire the technology needed to adequately protect privacy, then they are going to experience problems like Facebook is experiencing now. They may be able to kick the can down the road a few quarters until U.S. privacy protections go into effect in California or Congress decides to implement nationwide regulations, but they are coming. The start of enforcement of the California Consumer Privacy Act is January 1, 2020 – only 17 months away!

Improve Data Privacy for GDPR or CCPA with Clarip

The Clarip team and privacy management software are ready to meet your compliance automation challenges. Click here to contact us (return messages within 24 hours) or call 1-888-252-5653 to schedule a demo or speak to a member of the Clarip team.

If compliance with the California Consumer Privacy Act is your focus until 2020, ask us about our CCPA software. Handle automation of data subject access requests with our DSAR Portal, or provide the right to opt out of the sale of personal information with the consent software.

Need to improve your GDPR compliance solution? Clarip offers modular GDPR software that can fill in gaps in your privacy program. Choose from the data mapping software for an automated solution to understanding your data collection and sharing, conduct privacy risk assessments with DPIA software, or choose the cookie consent manager for ePrivacy.

Click here to contact us (return messages within 24 hours) or call 1-888-252-5653 to schedule a demo and speak to a member of the Clarip team.

Warning from Facebook Stock Drop: Take Privacy Seriously!

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