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Facebook May Be Mendacious, But It’s Not Stupid

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As you may have heard, Facebook is discussing changing its name. But will this seemingly cosmetic change actually have a deep effect on the company? On the latest Pivot podcast, Kara Swisher and Scott Galloway discuss why the strategy might be less silly than it seems.

Kara Swisher: Facebook is reportedly planning to change its company name. There are no hints yet, but it’s worth noting that the domain Mediacom redirects to metadata org, which is owned by the Chan Zuckerberg Initiative. That’s their philanthropy arm — Mark Zuckerberg and his wife, Priscilla Chan. Zuckerberg may need more than a change of name. He may be added to a consumer-protection lawsuit soon, personally. The D.C. attorney general says Facebook broke the law by giving third-party apps access to user data, resulting in the Cambridge Analytica scandal. He now says Zuckerberg was responsible for giving those apps access himself.

The name change has been worked on for a couple of years, apparently, and then recently gotten more attention inside the company. Some people think it’s going to be Meta, some don’t. And it’s not clear whether they’re even going to do it or not. Obviously, Google changed its name to Alphabet many years ago. Everyone calls it Google anyway. What do you make of this?

Pivot

Twice weekly, Scott Galloway and Kara Swisher host Pivot, a New York Magazine podcast about business, technology, and politics.

Scott Galloway: In the world of brand strategy, brand architecture is one of the most interesting parts — that’s how you treat brands as a portfolio like you would stocks in a portfolio. I think what’s going on here is that occasionally a brand tries to change its name from RJR to Altria thinking they’ll somehow escape their legacy. It can serve as a cultural or chronological milestone to say, “All right, we’re actually making changes, and this is our new identity.” It usually doesn’t work, i.e., Tronc. No one buys, “Okay, you’re somehow digital and get it now, Chicago Tribune.”

But what’s going on here that people aren’t reporting on is that a brand-architecture move like this is structurally a very effective retention tool and can also serve as what I call a branded human shield. Now what do we mean by that? Every individual in Big Tech that runs a big sub-business of a larger Big Tech company gets calls all the time to come be the CEO of a different great company, a bigger one. So what the first Big Tech company does is they say, “All right, we’re not Google, we’re Alphabet. And Sundar, you’re now the CEO of our search division called Google.” It’s a fantastic retention tool.

Swisher: Well, he’s now CEO of the whole thing. But go ahead.

Galloway: Well, he elevated, though, right? It’s an incredible retention tool because titles are cheap and you basically proliferate the number of CEO titles and corner offices you can get people. But what’s going on here, and I actually think it’s a smart move, is that they’re going to use the brand as a human shield. They’re going to call the company Meta or Kan and then hire Kanye. I mean, they’ll just come up with something, right? And when anyone calls and says the words “teen depression” or “insurrection” or “Frances Haugen,” he can say, “Oh, you should talk to the CEO of Facebook.”

And he’ll attempt to starch his hat white and be seen on morning television, wearing Oculus a lot, and he’ll get much more involved and try and position his brand around the Metaverse, and he’ll find someone who will pay $10 to $50 million a year to basically go take a bunch of arrows in D.C. and he’s going to exonerate or lift himself or get the hell out of Facebook Dodge. So this is a human shield for Mark Zuckerberg. And it’s also a means of retention because they’ll create more CEO spots. I think it’s a smart move, quite frankly.

Swisher: So you think it’s not just putting lipstick on a pig. There are jokes about “Truth” being the new name of Facebook, etc., etc.

Galloway: Look, I think Facebook is mendacious. I think they demonstrate a lot of sociopathy, a lack of regard for the commonwealth. But they’re not dumb. And right now, they’re in a canyon and there’s tsunamis of shit pouring down for them everywhere. And I imagine more than one person has said, “We need what I would call a blood offering. We need a dramatic change here. And Mark, you need to disassociate.” I mean, an attorney general just added him personally to a suit. So I think he’s basically decided, I need to disassociate and distinguish and put ring fence around my involvement. I need the overlap between Mark Zuckerberg and Facebook to be less of an overlap. And I’m going to create a new brand architecture. I’m going to put someone in charge of Facebook so I can pretend it’s not my fault and I’m going to go on morning shows with Oculuses, which is a lot less toxic.

Swisher: But can he do that? Everyone knows he has full control over everything. Can he actually pull it off? In the case of Alphabet, you know, Larry Page just, I think, didn’t want to talk to people. And there were no PR people at Alphabet — like, you couldn’t reach them, so you could never understand where the real power was, and that was the point. But I think in that case, there wasn’t a particular controversy they were trying to avoid.

You know, I think they were just doing the first thing, which was giving people — Susan was the CEO of YouTube and Sundar Pichai was CEO of Google, and I get that part of it. And they did this at AOL many years ago — there was always a CEO of one of the divisions, right? It was a way to sprinkle around benefits to people, I guess. But this one — I think he cannot be disengaged from Facebook. Can he?

Galloway: Well, another thing I agree with you. No one should go for the head fake, but I think it’s a smart strategy. He wants to reposition himself around something more benign. He wants to distance himself from Facebook, and he wants to reposition, if you will, or increase the positioning of the company and him personally around, quote-unquote, the Metaverse. It’s much less toxic. It’s much more hopeful. It’s much more visionary. And then at a minimum, he’ll probably get out of a couple summons or calls to come speak in front of the House Antitrust Subcommittee because they will argue — and the committee will go for it — that, “Well, you should speak to the CEO of Facebook. That’s the right person to come.” I hope people don’t fall for it.

Pivot is produced by Lara Naaman, Evan Engel, and Taylor Griffin.

This transcript has been edited for length and clarity.

Facebook May Be Mendacious, But It’s Not Stupid