If a $5B Fine Is Chump Change, How Do You Punish Facebook?
&gt; <i>What does a good, meaningful fine actually look like? Would it need to wipe out one quarter’s revenue (roughly $15 billion)? Is a fine meaningless unless it’s recurring (penalties for every quarter or year since Facebook last settled with the F.T.C. for violating user privacy in 2011)?</i><p>I get that people want to see a company <i>crippled</i> but wiping out a quarter of <i>revenue</i> is a death-blow.<p>I don’t use Facebook at all, but I followed the CA scandal because I thought it was an interesting case that Facebook predictably botched nearly every aspect of handling it.<p>$5 billion is a lot of money. It is not and never can be considered “chump change”. It is irrational to think a Board or management team isn’t going to seriously implement rigorous changes to avoid a $5 billion dollar fine.<p>This is where someone says that if you can violate the law and earn $6 billion and only be fined $5 billion you will violate the law every time.<p>There are numerous problems with this statement. One, you don’t know ahead of time what the fine will be. Two, it assumes there’s no way to earn even $1 of the $6 billion without violating the law.<p>If you can earn $3 billion without violating the law and double it to $6 billion with the violation, but the fine is $5 billion then it’s not “worth it” but even still this fails to account for the tremendous reputational and legal risks.<p>One parting thought. If the behavior which is being fined was directly used to obtain a monopoly position in the marketplace which the company continues to benefit from, that changes the calculus. But was CA’s ability to scrape social network data from Facebook’s API a proximate cause of Facebook’s market position?