Facebook was caught lying to advertisers (again)

Unredacted court documents show that Facebook knowingly misled advertisers on how many eyeballs the platform reaches.

February 23, 2021

(Getty Images / Drew Angerer)

Remember when Mark Zuckerberg battled the Winklevoss Twins to determine who created Facebook?

The legal process uncovered messages from Zuck that said he wanted to do something (we can’t print here) to the ears of the Winklevoss Twins.

Based on a recent drop of unredacted court filings, it looks like Scrooge McZuck has been doing the same unprintable actions to advertisers.

The remarks come from a 2018 California lawsuit…

… which claims that Facebook “knowingly overestimated its ‘potential reach’ metric for advertisers,” writes The Verge.

The core of the lawsuit is that the social media giant didn’t adjust for fake and duplicate accounts.

In one nugget from the filing, Facebook told advertisers it could target 100m people aged 18-34 years old in the US even though there are only 76m people in that age group.

Facebook COO Sheryl Sandberg knew about the issue

Per The Verge, one Facebook product manager told Sandberg that some revenue should “never [have been] made given the fact that it’s based on the wrong data.”

Another employee added the process was “deeply wrong,” but Facebook neglected to make a fix, saying it would have a significant impact on revenue.

3rd time’s the harm

Antitrust expert Matt Stoller notes that Facebook has already been busted on 2 separate occasions for lying to advertisers:

  • “Pivot to video”: In 2016, Zucky McClaims told the world that Facebook was going all in on video, and it misled advertisers about video metrics to boost the program.
  • Measurement tool: At the end of 2020, Facebook told advertisers that its “conversion lift tool” (which measures ad performance) overestimated campaign results.

While Facebook has largely avoided major repercussions for its activities, Stoller believes the tide is turning:

  • Australia is taking a tough (albeit flawed) position against Facebook in regards to hosting publisher content
  • Canada and the UK have called Facebook a bad-faith actor for blocking Australians from seeing news
  • In the US, Facebook faces an antitrust suit

In sum, Facebook is facing attacks on its ears business from regulators the world over.

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