01 May 2018

This Guy Just Cost Himself a Billion Dollars on Principle

The billionaire chief executive of WhatsApp, Jan Koum, is planning to leave the company after clashing with its parent, Facebook, over the popular messaging service’s strategy and Facebook’s attempts to use its personal data and weaken its encryption, according to people familiar with internal discussions.

Koum, who sold WhatsApp to Facebook for more than $19 billion in 2014, also plans to step down from Facebook’s board of directors, according to these people. The date of his departure isn’t known.


The independence and protection of its users’ data is a core tenet of WhatsApp that Koum and his co-founder, Brian Acton, promised to preserve when they sold their tiny start-up to Facebook. It doubled down on its pledge by adding encryption in 2016. The clash over data took on additional significance in the wake of revelations in March that Facebook had allowed third parties to mishandle its users’ personal information.


Koum’s exit is highly unusual at Facebook. The inner circle of management, as well as the board of directors, has been fiercely loyal during the scandals that have rocked the social media giant. In addition, Koum is the sole founder of a company acquired by Facebook to serve on its board. Only two other Facebook executives, Zuckerberg and Chief Operating Officer Sheryl Sandberg, are members of the board.


Acton left the company in November. He has joined a chorus of former executives critical of Facebook. Acton recently endorsed a #DeleteFacebook social media campaign that has gained force in the wake of the controversy over data privacy sparked by Cambridge Analytica, a political marketing firm tied to the Trump campaign that had inappropriately obtained the private information of 87 million Facebook users.


WhatsApp executives were comfortable sharing some data with Facebook to measure who was using the service, according to the people. But they opposed using WhatsApp’s data to create a user profile that was unified across Facebook’s multiple platforms, which also include Instagram and Facebook Messenger, and that could be used for ad-targeting or for Facebook’s data-mining.


Another point of disagreement was over WhatsApp’s encryption. In 2016, WhatsApp added end-to-end encryption, a security feature that scrambles people’s messages so that outsiders, including WhatsApp’s owners, can’t read them. Facebook executives wanted to make it easier for businesses to use its tools, and WhatsApp executives believed that doing so would require some weakening of its encryption.
Here is the link about him leaving a 10 figure payday on the table.

I'm not sure if it's really possible to make privacy profitable without charging users, but you sure as hell can't do it at Facebook.


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