Sheryl Sandberg revealed the new scare-tactic Facebook is using to stop regulators from breaking up Facebook (FB)

Sheryl Sandberg says the company is working hard with regulators worldwide to create new rules to regulate internet companies including Facebook.
And she’s got a new argument as to why regulators shouldn’t break up Facebook.
The argument goes like this: even if we broke up Facebook there would still be big, powerful Chinese companies, not being subject to a break up.
It’s a red herring argument for sure, but gives insight into the types of conversations Facebook is having with regulators as it lobbies them for rules to its liking.
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In what seems like an scene from Groundhog Day, Facebook executives are once again on the apology-and-promises tour about the company’s lax attitude towards privacy and security.

On Friday, Facebook COO Sheryl Sandberg appeared on CNBC interviewed by Julia Boorstin and was asked about calls to break up the company, sparked by Facebook co-founder Chris Hughes last week. This comes after the revelation that a vulnerability in WhatsApp allowed some users’ phones to be infected by a sophisticated snooping tool that’s been used to target political dissidents.

Sandberg stuck to new-and-slightly-improved company talking points, admitting that "we know at Facebook that we have a real responsibility to do better and to earn back people’s trust," she said on CNBC, and promising that "we’re fundamentally changing how we run the company."

Facebook says that it’s investing billions in areas like privacy, content security, and safeguarding elections, even if that limits some of the ads that might run on its site.

But Sandberg also revealed that the company is now fully focused on helping regulators create the rules that would be used to oversee Facebook and all the internet companies (including Facebook’s competitors).

"I know that people have real concerns about the size and power of the tech companies, including Facebook. And I think those are the right questions. And the question is what is the right answer? I think the right answer is to set up the right rules for the internet," Sandberg said.

And she also revealed a new scare-tactic argument for regulators to not break up Facebook that we’re likely to hear a lot more of in the months ahead: China.

Sandberg said she just spent time in Washington meeting with elected officials in both political parties.

"But let me share with you something else I heard in my meetings in D.C. And I heard this in private meetings from both sides of the aisle, that while people are concerned with the size and power of tech companies, there is also a concern in the United States about the size and power of Chinese tech companies. And that, you know, realization that those companies are not going to be broken up," she said (emphasis ours).

"And so, the question is for us is how do we make sure we protect privacy, how do we make sure we work with authorities to safeguard elections, how do we make sure the right content is on Facebook and how do we make sure that the right regulatory framework is in place? And we’re working hard on all of that," she said.

Bringing in China is really a red herring, fear-tactic argument.

Chinese companies may very well be powerful. Some of them may also be patsies for government-sponsored spying or mafia-like hacker syndicates.

But that has nothing to do with whether or not Facebook is behaving in the public interest.

You can break it up, but that won’t stop the problem

Facebook and Google are pretty much a duopoly when it comes to internet advertising (although Amazon, another arguably too-powerful tech company is trying to break in).

To maintain its billions in revenue, Facebook collects data on people in order to sell ads. In order to collect data, Facebook allows its users to share content. The more data Facebook collects, the more money it makes.

Sandberg points out, correctly, that breaking Facebook apart will merely create multiple companies, all now focused on growth and not user protection.

"Because you could break us up, you could break other tech companies up, but you actually don’t address the underlying issues people are concerned about," she said. "With so many people on our services, whether you have them in one company or many, there is still a lot of people."

Read: Why breaking up Facebook is actually a terrible idea

As long as its business model remains the same, the company’s continual protestations that, this time, it can be left alone to do the right thing are suspect at best, even if CEO Mark Zuckerberg and Sheryl Sandberg appear to be good people at heart that want to do right.

Meanwhile, Sandberg is spending her time personally lobbying Congress, and, she said, Zuckerberg just personally met with French President Macron— a country where both Facebook and Google have been in hot water with regulators before, including fines.

So, what is the company really doing? Trying to influence the regulators and regulations.

"If I look at my job now, my job has really changed. That we — I used to spend more of my time working on growth and now I’m spending more of my time safeguarding the company," Sandberg said.

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Source: Business Insider – jbort@businessinsider.com (Julie Bort)