How does facebook make money senator

Opinion: Facebook stock rebounds as CEO manages to stay calm amid a storm of silly questions from senators. Mark Zuckerberg has come far since the early days of Facebook Inc. Wearing a conservative suit and light blue tie, an outfit he would rarely wear in Silicon Valley, Zuckerberg sat ramrod straight in his witness chair for most of the many hours of questions. He responded to each wenator by first addressing them as senator or chair. He looked earnest and serious for almost every question, even during some of the laughable questions from some of the less tech-savvy members of the Senate, such as the one by Sen. According to the New York Times, Facebook hired a team of experts to give Zuckerberg — who can be combative and defensive — a crash course in humility and charm ahead of the hearing in sessions that included mock hearings with its communications team and outside advisers. That preparation paid off: After the first two hours of questions were nearing an end and facevook was a call for a potential break, Zuckerberg took a sip of water and said he could keep going for a bit longer. That break came just after trading ended, with Facebook stock noticeably jumping as the hearing went on and gaining 4. Still, Facebook stock is down 6. As Tuesday wore on, though, the questions from some senators improved, as they attempted to determine whether Congress should intervene with regulations on privacy. Still, Zuckerberg managed to stay on message and say little that Facebook had not already said in facebool flurry of announcements and interviews over how does facebook make money senator past few weeks. The key question will be what senators do once Zuckerberg has left Capitol Hill.

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Tuesday’s five-hour hearing highlighted one thing: Relatively few US senators understand Facebook’s business. But he walked away from his first day of congressional hearings looking pretty confident. That’s because many of the questions came from tech-challenged senators who seemed clueless about how Facebook makes its money and how the internet works. Zuckerberg paused a moment before saying, «Senator, we run ads. Team Facebook looked pleased because Hatch’s question, like those from many of the senator’s peers, showed a lack of basic understanding about how Facebook operates. That money came from ads directed at the site’s 2. Facebook is a large, often secretive company that many in tech — not to mention regular consumers — have difficulty understanding. But Congress has toyed with the idea of regulating Facebook and other social media networks. If it doesn’t understand how they actually work, it may be harder for Congress to develop laws that adequately protect consumers and prevent something like the Cambridge Analytica scandal from happening again. Facebook’s shares jumped 4. Many on Twitter agreed that Zuckerberg didn’t quite get the tough grilling that was expected. At one point well into the proceedings, Zuckerberg himself told the Senate committee he wasn’t ready for a break and asked to keep going.

How Mark Zuckerberg became the fifth richest person on Earth.

Instead of Twitter being outraged over Zuckerberg’s statements, many lamented how little US legislators seemed to understand. Zuckerberg, a magazine i recently opened came with a floppy disk offering me 30 free hours of something called America On-Line. Is that the same as Facebook? Facebook stock up 4. Zuckerberg took the hot seat Tuesday — and will testify again Wednesday — to account for data privacy lapses at the company he started 14 years ago in his Harvard dorm room.

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Even if you were watching, it’s entirely likely that you missed a crucial, brief segment around the two-hour mark, where Senator John Cornyn asked Zuckerberg about how Facebook handles ex-user data. Though somewhat unrelated to what Senator Cornyn asked, Zuckerberg’s answer was a fascinating, concise look into how Facebook turns its vast quantity of user data into profit. We don’t sell data to anyone. Indeed, Facebook makes it money through advertising. Facebook doesn’t provide data to advertisers — it does the work for them. So, if an advertiser comes to us and says, ‘All right, I am a ski shop and I want to sell skis to women,’ then we might have some sense, because people shared skiing-related content, or said they were interested in that, they shared whether they’re a woman, and then we can show the ads to the right people without that data ever changing hands and going to the advertiser. In the wake of the Cambridge Analytica scandal , which revealed that at least 87 million Facebook users had their data used without consent by a political firm to influence elections including the US Presidential election , general users, celebrities, tech executives and politicians have begun openly questioning Facebook’s handling of user data. Facebook now admits fault for allowing third-parties to access user data inappropriately, which is what led to companies like Cambridge Analytica possessing user data in the first place. The company has since shut down loopholes in its social media service that allowed third-parties to «scrape» data from its users.

Repetition and confusion

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Mark Zuckerberg goes to Washington

Sign up for our newsletter. Investopedia requires writers to use primary sources to support their work. Facebook CEO Mark Zuckerberg testified before Congress for over five hours on Wednesday, where he answered questions from senators on a broad range of subjects. Major competitors include Apple Inc. It often indicates a user profile. Social Networking Service — SNS A social networking service SNS is an online vehicle for creating relationships with other people who share an interest, background or real relationship. By Grace Lisa Scott on May 10, You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy. All that said, Facebook still directly relies on user data to make money — it’s just not in quite the way you may have thought. This how it does it:.

Facebook Inc. FB primarily makes money by selling advertising space on its various social media platforms. Those platforms include websites and mobile applications that allow users the ability to connect and communicate with family and friends. The company’s sites and apps include social networking site Facebook, photo- and video-sharing app Instagram, and messaging apps Messenger and WhatsApp.

Facebook also provides an ecosystem that allows users to connect through its Oculus virtual reality products. Major competitors include Apple Inc. The other Growth in both net income and revenue slowed considerably in compared to the year earlier. The slowdown in revenue growth appears to have continued throughout the first three quarters ofwhile net income declined. Facebook breaks down its revenue into two separate segments: Advertising and Payments and other fees.

The company does not do a separate breakdown for net income. Facebook generates substantially all of its revenue from selling advertising to marketers.

Ads are displayed on Facebook’s main social-networking site, as well as Instagram, Messenger, and other third-party affiliated websites or mobile applications. Marketers pay for ads based on the number of impressions delivered or the number of actions, such as clicks, undertaken by users.

Revenue from payments is derived from the net fee Facebook receives from developers using its payment infrastructure.

The other fees are comprised of revenue from the delivery of consumer hardware devices and various other sources. Facebook has been forced to defend its reputation in recent years as it’s faced a growing backlash over fake news and data-privacy issues.

In Aprilthe company issued a case study confirming that several groups had attempted to use its social-networking site to influence the presidential election. In Marchnews broke that political consulting firm Cambridge Analytica had illegitimately accessed millions of users’ data and used the data to influence voters to support presidential candidate Donald Trump during his campaign.

The company currently is facing four separate antitrust investigations, including one by the U. Department of Justice DOJ.

Facebook also faces resistance from global regulators over its proposal to launch its own cryptocurrency, Libra. Considering the other issues Facebook is currently facing with regulators, it wouldn’t be surprising if next year’s planned launch of Libra is delayed. Accessed Dec. Justice Department to open Facebook antitrust investigation: source ,» Accessed Dec.

The Libra Association. Company Profiles. Top Stocks. Your Money. Personal Finance. Your How does facebook make money senator. Popular Courses. Stocks Top Stocks. Table of Contents Expand. Facebook’s Financials. Facebook’s Business Segments. Facebook’s Recent Developments. Key Takeaways Facebook sells ads on social media websites and mobile applications. Ad sales are the primary source of Facebook’s revenue. Facebook is investing heavily to develop new products, including the new Libra cryptocurrency, artificial intelligence AIand augmented reality.

Facebook is being investigated by four separate groups of U. The company’s Libra cryptocurrency is facing stiff resistance from global central banks and other regulators. Facebook breaks down its revenue, but not income, into two main segments, as outlined. Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts.

We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy. Compare Investment Accounts. The offers that appear in this table are from partnerships from which Investopedia receives compensation. Related Articles.

Entrepreneurs Like all social media giants, Snapchat’s business is all about ads. Partner Links. Related Terms Understanding the Network Effect The network effect is a phenomenon whereby a good or service becomes more valuable when it is used by more people.

On the Move: Mobile Commerce Mobile commerce is the use of wireless handheld devices, such as cellphones and laptops, to conduct commercial transactions online. Social Networking Service — SNS A social networking service SNS is an online vehicle for creating relationships with other people who share an interest, background or real relationship.

Kin Kin is the official cryptocurrency of the Kik messenger service. Kik users are able to earn Kin for making contributions to the broader Kik community. Social Media Social media technology facilitates the sharing of ideas, information, and thoughts through the building of virtual networks and communities.

Understanding Social Networking Social networking is the use of Internet-based social media programs to make connections with friends, family, colleagues, or customers.

Advertising dominates revenue, but growth is slowing

Hatch asked Mark Zuckerberg on Tuesday. Hatch: «If [a version of Facebook will always be free], how do you sustain a business model in which users don’t pay for your service? Mick micktorious April 10, Orrin Hatch just asked how Facebook makes money, but, in his defense, he was distracted because he forgot where he parked his dinosaur. If Facebook is free, how do you profit? Zuckerberg was on Capitol Hill for the first of two days of congressional testimony on the Cambridge Analytica data leak — when 87 million users had their profile information how does facebook make money senator shared.

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Dianne Feinstein D-California. Tech leaders are increasingly intertwined with the news business. While some want to support old properties, one set out to destroy a new one. Here they are. The Facebook co-founder purchased The New Republic inbecoming executive chairman and publisher.