Cambridge Analytica shuts down but founders turn up at new firm

While Cambridge Analytica has been buffeted by the data breach scandal, Mark Zuckerberg's company has only made gains in users and profit.

Cambridge Analytica has closed its doors, citing mounting legal costs and loss of clients since its involvement with a Facebook data breach was exposed.

The US company's British affiliate, SCL Group, is also shutting down.

However, within hours of the news of Cambridge Analytica's demise, The Register noted the UK Companies House has already posted a new listing for a company called Emerdata Ltd, "headquartered at the same office as SCL Elections and run by much of the same management and investors as Cambridge Analytica."

The Register concludes, "it seems the 'bankruptcy' may be less a business catastrophe than a marketing exercise."

But US media like Wired and the Wall Street Journal have taken a different tack on Cambridge Analytica's decline in fortunes.

Their general meme is that clients walked away in part because of brand embarrassment but also because Analytica was over-hyped. 

It promised a lot in terms of psychological profiling of customers but under-delivered, the Journal says in an article that quotes clients.

Chief executive Alexander Nix talked up advanced big data tactics but much of Analytica's work was traditional Facebook marketing, the unnamed clients say.

The Trump campaign spent $US9 million with Analytica but it is not clear how much that budget affected an election where the Republican insurgent also displayed a low-tech, gut instinct for harnessing voter anger.

As part of its work for the Trump Campaign, Analytica contracted a researcher to post a personality quiz to Facebook to harvest user data.

By exploiting a Facebook policy at the time that allowed apps to access a user's friends and friends-of-friends' data (also exploited earlier by the Obama campaign), Analytica was able to access personal information on 83 million Facebook users.

In New Zealand, only 10 people took the personality test, Facebook says. However, due to the app's ability to access a user's friends, and friends of friends' data, Analytica ended up with 63,714 Kiwis' data.

Facebook only admitted to the extent of Analytica's access to its customers' data after it was exposed in the media. 

The social network has since tightened its privacy policies, to a degree, and chief executive Mark Zuckerberg has appeared before both the US Congress and Senate – where pundits generally thought he acquitted himself well against lawmakers who lacked the knowledge to ask sharp follow-up questions.

It's still uncertain if the US or other countries will impose new regulations on the social network. But in the first quarter of 2018, the Analytica scandal didn't touch the sides, with Facebook reporting gains in the number of its users and record profit.

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2 Comments & Questions

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Rouges and more rouges.....much more to come.

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Forget Analytica. From Day 1 Facebook was downloading your contacts list of your email program without your explicit permission. Soon after it compared everyone's contacts, and then moved on to analysing the email addresses in your inbox and sent items.

And don't forget that Google and/or internet browsers and Facebook share data. Zuckerberg et all have also received funding from shadow companies because the data was valuable to the NSA / CIA etc. Don't kid yourself,Zuckerberg was in boots and all, but probably thought he was invincible because he was protected. I doubt he was under any serious real threat from the authorities.

From a security monitoring viewpoint, silent outbound links from internet browsers to Facebook ceased for a while around the Senate hearings but resumed soon after. Browsers make these links irrespective as to whether or not you belong to Facebook. Don't think for a minute anything you do online is private. You don't need to use an app or submit personal information as part of a quiz to have your personal information compromised. Simple being on the internet is enough.

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