Zuckerberg should ask one of his board members — Netflix CEO Reed Hastings — how to write an apology

  • Facebook shares sank almost 7 percent on Monday as the company dealt with the fallout of the Cambridge Analytica crisis.
  • As CEO Mark Zuckerberg is struggling to find the right response to the market, he could turn to fellow board member Reed Hastings for help.
Reed Hastings, chief executive officer of Netflix
Patrick T. Fallon | Bloomberg | Getty Images
Reed Hastings, chief executive officer of Netflix

Facebook CEO Mark Zuckerberg hasn't yet found the words needed to calm the market after the disastrous Cambridge Analytica story that broke Friday continues to pick up steam.

Facebook shares plunged 6.8 percent on Monday and another 1.5 percent in extended trading. This comes after a weekend when the company and independent news reports said that a psychology quiz app collected data about 50 million Facebook users under false pretenses, then shared that data with the political analytics firm without user permission.

Facebook execs took to Twitter in the wake of the reports to deny that this was a security breach, and Cambridge has said that it deleted that data, contrary to the news reports.

Meanwhile, Zuckerberg, who created the social network 14 years ago from his Harvard dorm room, has stayed quiet.

If Zuckerberg really wanted help in crafting a soothing apology, he could just look across the boardroom table. There he'd find Netflix CEO Reed Hastings, who seven years ago made a mistake so catastrophic that it almost sank the company he started in 1997.

In 2011, Netflix raised prices and announced it was splitting its DVD business into a separate company.

Then Hastings apologized in a letter that began: "I messed up. I owe everyone an explanation."

That alone wasn't enough to spark a rally, as Netflix continued to reckon with a deteriorating subscriber outlook. In fact, the stock sank more than 50 percent from there before bottoming about a year later. Along the way Hastings had to kill a hastily unveiled plan to rename the DVD business "Qwikster."

But since mid-2012, Netflix has represented one of the best investments of the decade, multiplying 40-fold on the way to a $136 billion market capitalization. Once roundly criticized for abruptly deciding to separate the DVD and streaming units, Hastings is now lauded for his foresight in recognizing that the physical distribution business was headed for the dustbin.

Zuckerberg is in a different kind of crisis.

His company had already been embarrassed by revelations that Russian-backed groups infiltrated the site and distributed propaganda that was seen by about 126 million Americans ahead of the 2016 presidential election. It had already been called to testify multiple times in front of Congress about its role in the spread of fake news.

Now there's the suspension of Cambridge Analytica, which worked on behalf of Donald Trump's campaign, for allegedly misusing data of 50 million people to target them with political ads based on personal information.

Asking forgiveness

It's not as if Zuckerberg doesn't know how to apologize. On the very subject of abuse of Facebook's platform, Zuckerberg started the Yom Kippur holiday, the Jewish day of atonement, with a public comment on Sept. 30.

"For those I hurt this year, I ask forgiveness and I will try to be better," Zuckerberg wrote on his Facebook wall. "For the ways my work was used to divide people rather than bring us together, I ask forgiveness."

By the looks of it, the Cambridge Analytica story is only beginning to unfold.

Many of Zuckerberg's lieutenants have weighed in, including Chief Security Officer Alex Stamos, who is reportedly leaving the company. Carolyn Everson, the company's vice president of marketing, said at a conference on Monday that, "If the allegations are true, this is an incredible violation of everything that we stand for."

Hastings alone surely doesn't have all the answers. But it would seem that his experience with existential crises would be particularly valuable right about now.