Three Post-IPO Causes For Concern For Facebook

By Julie D. Andrews 

It’s not all roses and chocolates in the land of social-networking giants, despite Facebook’s initial public offering Friday. There are some real issues to be grappled with in Facebook’s future. And while not insurmountable, the problem areas are real threats, although they have been missed by blaring headlines.

In fact, many of the risk areas users delve into when accessing Facebook are unknown to them, SmartMoney pointed out.

Among the 10 areas of concern highlighted by SmartMoney, here are three to watch.

Application Security

Historically, Facebook has not done a grand job of monitoring app developers since allowing them to run their self-built apps on the social network. Recently, devious app developers were busted for stealing user information and cashing in on it with data-collection firms. Facebook is aware of the issue, and it has said that it is working harder to enforce such data breaches, coming up with technical fixes to better guard data. Still, a recent AP/CNBC poll of more than 1,000 adults found that only 13 percent of Facebook users trust their personal data in the social network’s hands.

Free Falling?

Co-Founder and Chief Executive Officer Mark Zuckerberg has repeatedly promised that Facebook will remain free … always. Yet, some analysts question whether this “it’s free and it always will be” motto will be sustainable. The reality is, now that the company has gone public, it will have stakeholders to answer to. The social network may therefore have to consider new models, suggested SmartMoney, such as one in which basic services remain free with the ability to buy extra features (similar to the LinkedIn model). Other non-advertising-based ways to raise profits may include paid-for posts with guaranteed exposure to all friends, apps for sale, and folding ads into mobile.

Privacy Pressures

Privacy concerns continue to be the elephant in the room for the social network. As Facebook seeks new ways to squeeze even more personal data out of users, it is highly likely that users’ information may be leaked unknowingly (if new opt-out data spills were to appear). Already, the like button allows Facebook to essentially track users around the Web by keeping tabs of which websites they visit and how often via social plug-ins. Facebook makes efforts to announce its policy to users, making it readily visible and stating that it only stores users’ Web-surfing data for up to 90 days. The question, though, is whether all users (especially those younger in age) are versed in these policies, and whose responsibility that is. Additionally, scammers can steal sensitive data and passwords through phishing. “People are more vulnerable on social networks because there’s a natural tendency to trust the sender, unlike spam in your email from Viagra,” David Ulevitch, CEO of Internet-security service OpenDNS, told SmartMoney.

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