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is Facebook really the most ‘vulnerable’ big tech firm facing disruption ?

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Facebook is the most vulnerable large technology company when it comes to facing disruption, a prominent venture capitalist told CNBC on Tuesday, amid ongoing concerns around privacy.

The social media giant had a rough 2018. It kicked off after revelations that the data of 87 million Facebook users had been harvested by a political consultancy that ended up working with President Donald Trump’s campaign. Then came reports about Russian-backed attempts to influence American elections and news that 50 million Facebook accounts were compromised in a cyberattack, in addition to the resignation of Instagram’s founders.

Rebeca Hwang, co-founder and managing director of Rivet Ventures, said backlash from users toward social media firms has left Facebook is a tough place.

“I do think Facebook is in a very vulnerable place right now. Both seen from the perspective of the consumer reaction … but also from the perspective of the deal flow that I see and the types of companies that are trying to become the disruptors of a Facebook,” Hwang said during a CNBC-hosted panel at the Davos Sanctuary.

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“In my opinion, they have to take very strong actions to maintain their position.”

Facebook was not immediately available for comment when contacted by CNBC.

Part of the discussion on the panel focused on the power of the world’s largest technology firms and whether they are too powerful to face disruption. Hwang said that the heightened sensitivity among consumers toward data privacy could provide an opportunity for start-ups.

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“I think the ones that have become dominant, especially with younger generations, it’s also very challenging having that status. And so I don’t necessarily see a future where all of these giants will continue dominating forever. I think there will be disruptors in some of these areas by new players,” Hwang told CNBC. Blockchain disruption?

Phil Chen, managing director at venture firm Presence Capital and decentralized chief officer at HTC, said blockchain technology could take some power away from big tech firms.

Blockchain is the technology that underpins the cryptocurrency bitcoin. It is a public ledger of transactions in bitcoin that is decentralized, meaning it is not owned by any one person. Instead, it is maintained by many participants.

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Chen argues that companies like Facebook hold data on users in a central database that is owned by the company.

But blockchain technology could decentralize databases, allowing users to own their own data, and taking the power away from large companies.

“That’s the hope, that’s the thesis. At the end of the day today, the big corporates, they have big central servers that hold everybody’s data. I think what bitcoin and blockchain really allows … is empowering people to own their own keys,” Chen told CNBC.

A key is a unique cryptographic address that allows someone to own their own cryptocurrency. Chen argues that this unique key could also allow users to own their own data.

“Once you start owning your own keys, which is the means in which you own the cryptocurrency, then you start owning your identity, then you start owning your data, and that needs the whole crowd and the people to participate,” Chen said.

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ref: CNBC

Ayeni Sylvester
the authorAyeni Sylvester

44 Comments

  • Interesting. I honestly don’t think anything can take Facebook down… Not that that’s a good thing necessarily.

  • For how long facebook has been here, I don’t think anything can come close to bringing it down, I mean sure other apps and social platforms can try, and facebook has it’s fair share of issues but still, I think that people just became more accustomed to facebook. But we shall see what the future holds.

  • Blockchain indeed is the technology that underpins the cryptocurrency bitcoin. I have been reading a lot of articles about blockchains. Although, it’s quite difficult for me but glad I am getting somewhere. Thanks for sharing your post. Have a nice day.

  • There’s always speculation about how vulnerable they are. All giant companies have vulnerabilities, but I doubt it will destroy this one.

  • Great article! I actually think that Facebook as a company will remain for the next years and near future, because they really bought their greatest competition, crushed Snapchat theough their Instagram “function clone” abd where up to now pretty good in detecting trends. So as long they detect those future social media trends like VR, blockchain, social ecommerce, etc. Facebook (and their subsidiaries like Instagram, Whatsapp, etc.) will stay. The only thing that could truly disrupt them would be a startup having an amazing new way to connect people, which is so different from all that we’ve seen so far (same is true for the Google search engine).

  • Blockchain indeed is the technology that underpins the cryptocurrency bitcoin. I have been reading a lot of articles about blockchains. Although, it’s quite difficult for me but glad I am getting somewhere. Thanks for sharing your post. Have a nice day.

  • That’s a lot to consider! I think it would take a lot to bring Facebook down, primarily because of just how big and popular it is.

  • For how long facebook has been here, I don’t think anything can come close to bringing it down, I mean sure other apps and social platforms can try, and facebook has it’s fair share of issues but still, I think that people just became more accustomed to facebook. But we shall see what the future holds.

  • Interesting. I honestly don’t think anything can take Facebook down… Not that that’s a good thing necessarily.

  • There’s always speculation about how vulnerable they are. All giant companies have vulnerabilities, but I doubt it will destroy this one.

  • Great article! I actually think that Facebook as a company will remain for the next years and near future, because they really bought their greatest competition, crushed Snapchat theough their Instagram “function clone” abd where up to now pretty good in detecting trends. So as long they detect those future social media trends like VR, blockchain, social ecommerce, etc. Facebook (and their subsidiaries like Instagram, Whatsapp, etc.) will stay. The only thing that could truly disrupt them would be a startup having an amazing new way to connect people, which is so different from all that we’ve seen so far (same is true for the Google search engine).

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