LinkedIn Privacy Flip-Flop - Shareholder versus Customer
LinkedIn floated on the NY stock exchange in May this year. Since then they have been on a bit of a rollercoaster. On their first day of trading, they doubled in value to $9bn, reached over $10bn in July and then dipped last week to about $7bn. Now, while these numbers are NAMA-like and therefore we Irish might be immune, the fact that there has been a $3bn swing in the value of the company over the last few weeks has a huge impact on (a) shareholder value, and, as a consequence, (b) how the company is managed. The management team now has to justify the valuation!
Someone in LinkedIn is watching Facebook and tracking changes. And then mimicking them. I am sure that they are doing this with the right intention but not necessarily the correct result.
Paul Ducklin notes on the Sophos blog, that LinkedIn flagged the changes to the policy, and provided a link to the setting that allows users to opt out of the social-advertising campaign (which is here if you want to opt out). And LinkedIn did describe the changes on its blog at the time — including an offhand reference to the fact that users would all be opted-in to the new service by default — although it described the feature in glowing terms as a way of providing more relevant advertising for businesses and individuals using the network.
This opt-in (by default) feature mimics what Facebook did with their “Beacon” ad platform (which particularly exposed users data or profiles or activity on the network to other). Facebook have since closed this service after it was widely critised.
So why would LinkedIn be so slack? I am sure that LinkedIn reckoned that making the new social-advertising campaign opt-out by default, and then trying to convince users to sign up for it later, would be too hard. Those are likely the same reasons Facebook made the same decision — but it has suffered for it and some commentators are suggesting that LinkedIn deserves to as well. Not giving users the ability to make that choice before they are signed up shows a certain lack of respect for them that’s hard to ignore.
So, was opting users into a new social-advertising campaign by default — especially one that raises so many obvious privacy issues — really a clever move?
While we have yet to see as massive a backlash as Facebook received, LinkedIn’s director of product management admits that the company “could have communicated our intentions —- to provide more value and relevancy to our members —- more clearly,” and says that the campaign has been changed.
The ads that appear on the site will now no longer include the names or photos of users, the company said.
So, in the end, are these flip-flop decisions being made for the good of the client or the shareholder?