How Wiping Fake News Could Prove Costly To Facebook Inc. (NASDAQ:FB) ?

Facebook Inc. (NASDAQ:FB) fake news issue has caused a lot of problem for the social media giant. Although the fake news in itself is only a slight manifestation, it has caused many to doubt the credibility of the platform as a news-reliable site.

Furthermore, it is believed that all the fake news, which was circulating the social media platform during the U.S presidential elections, may have had an impact on the results of the elections. However, both critics and analysts agree on one thing, there is no doubt in the CEO of Facebook, Mark Zuckerberg’s sincerity to rectify this problem.

In order to combat Facebook fake news issue, on Friday, Zuckerberg outlines a few methods that the company intends to implement in order to rid the social media platform of all non-credible news content.

The plans to rectify Facebook fake news issue

In the announcement that was made, it was stated that as a method to remove the fake news from the site, the company would be integrating better-automated detection algorithms. These will be responsible for locating, and removing fake news before it gets posted.

In addition to this, the company will also be adjusting its current ad system. The reason behind this change is to ensure that fake news websites are unable to benefit from the advantage of Facebook advertising campaigns.

An analyst who works with Pivotal Research Group, Brian Wieser stated, “The new measurement concerns, the dropping of Atlas and the focus on ‘fake news’ from Facebook on the recent election cycle, collectively represent negative impacts on Facebook’s revenue growth.”

What does this issue mean for the sustainability of Facebook

Although, it is true that the stocks of Facebook have witnessed a rather significant decline since the elections, this is merely a coincidence. Analysts who are familiar with the matter declare that the main reason for the plummet in Facebook stocks is due to the recent revenue declaration made by the company.

Furthermore, it is not expected that the stock will suffer long term as a direct result of the Facebook fake news issue, which is proving to be troublesome for the social media giant.

Facebook stock closed at $117.02 after falling $0.77 or 0.65%

Add Comment