Zuckerberg Testifies About 2012 Emails

Mark Zuckerberg faced one particularly tense moment during the U.S. Congressional Antitrust Hearing. Rep. Jerry Nadler (D-NY) accused Facebook of antitrust activities in its acquisition of Instagram:

“Facebook, by its own admission ... saw Instagram as a threat that could potentially siphon business away from Facebook. So rather than compete with it, Facebook bought it. This is exactly the type of anti-competitive acquisition the antitrust laws were designed to prevent.”

Nadler’s conclusion is based on 2012 emails among Zuckerberg and his staff. In one email he wrote about Instagram:

“One way of looking at this is that what we’re really buying is time. Even if some new competitors springs up, buying Instagram, Path, Foursquare, etc now will give us a year or more to integrate their dynamics before anyone can get close to their scale again. Within that time, if we incorporate the social mechanics they were using, those new products won’t get much traction since we’ll already have their mechanics deployed at scale.”

Within an hour, Zuckerberg sent a second email, which some say proves his guilt:

“I didn’t mean to imply that we’d be buying them to prevent them from competing with us in any way.”

During the hearings, Zuckerberg defended the acquisition:

“I think the FTC had all of these documents ... and unanimously voted at the time not to challenge the acquisition. In hindsight, it probably looks obvious that Instagram would have reached the scale that it has today. But at the time, it was far from obvious.”

Discussion:

• Research and describe relevant U.S. antitrust laws.

• Read more about the 2012 emails and watch the hearings. How well did Zuckerberg defend the Instagram acquisition?

• Did Zuckerberg’s follow-up email prove his guilt? Why or why not?
  

Redskins Drop Their Name

Add The Washington Redskins to the growing list of organizations that are changing their name following the killing of George Floyd and protests around the world. The NFL team has been under pressure from fans and sponsors but, until now, has resisted changing the 87-year-old name.

Redskins owner Dan Snyder said he would never change the name, but requests could no longer be ignored from FedEx, Bank of America, PepsiCo, and Nike, the NFL’s apparel partner, which removed Redskins products from its website.

A team statement announced the decision, with no replacement name or logo yet.

Image source.

Discussion:

• Did the team do the right thing by changing the name? Why or why not?

• What are your thoughts about announcing the changing without a new name a logo? Should the team have announced both simultaneously? Why or why not?

https://www.nytimes.com/2020/07/13/sports/football/washington-redskins-new-name.html

P&G Commercials Demonstrate Empathy

Two Proctor and Gamble ads illustrate the role of empathy in understanding aspects of being Black in America. The first ad here, “The Look,” shows how a Black man experiences others’ reactions to him throughout the day. The second ad allows the viewer to watch intimate conversations that Black families have about race.

Discussion:

• How would you describe the role of empathy in addressing bias?

• What are the objectives of these ads? How well do they meet those objectives?

• What makes these ads effective—or not—in your opinion?

Analyzing the NFL's Apology

Years after NFL players “took a knee” to protest police brutality and other discrimination against Black people, NFL Commissioner Roger Goodell apologized “for not listening to NFL players earlier.” On June 5, less than two weeks after a police officer murdered George Floyd, Goodell posted a video to express his regret in handling player protests.

The response came on the heels of a video of Black NFL players saying, “What if I was George Floyd?” and asking the league to listen to its players.

Goodell’s video was introduced on NFL’s Twitter account with this statement:

“We, the NFL, condemn racism and the systematic oppression of Black People. We, the NFL, admit we were wrong for not listening to NFL players earlier and encourage all to speak out and peacefully protest. We, the NFL, believe Black Lives Matter.”

Skeptics wonder what will change in the league. Jim Litke, an Associated Press sports writer notes the lack of diversity within the NFL: “Three-quarters of the players are people of color, but just four head coaches, two general managers, and one owner, Shad Khan of the Jacksonville Jaguars, are.” Litke also points to Goodell’s shaky record of handling other “big issues,” like player concussions and domestic violence.

To that last point, this isn’t the first time Goodell apologized publicly. With a different delivery style, in a 2014 video, he said, “I got it wrong” after four players were temporarily benched for domestic violence incidents.

Discussion:

• Analyze Goodell’s video message: primary and secondary audiences, communication objectives, content, organization, etc.

• Compare this video to Goodell’s 2014 video. What differences do you notice in the delivery style? How do you explain Goodell’s strategic choices?

• What’s your view of the latest apology: genuine, placating, or something else?

• On face value, what leadership character dimensions does Goodell demonstrate? Which dimensions could Goodell display more strongly or directly?

Company Statements About George Floyd's Murder

Business Insider has assembled a list of companies’ statements and promised actions following the killing of George Floyd and the public protests.

TikTok, General Motors, McDonald’s—many brands are jumping into the conversation and posting messages that are both placating and inspiring.

Discussion:

• Read the list of statements and actions. Which sound most meaningful to you?

• Should all brands post a message? Which should, and what is important to convey?

Colleges React to Racist Posts

George Floyd’s killing has sparked protests around the world as well as backlash. A Chronicle of Higher Education article describes a few colleges acting quickly—within one day—after seeing a current or an admitted student’s racist post.

In a statement, The University of Denver condemned racist posts and announced, “The University has rescinded the student’s admission offer and they will not be attending DU.”

Some pubic universities, such as Missouri State, have published statements but are not expelling students or rescinding admission offers. President Clif Smart explains the university’s stance in a blog post.

Image source.

Discussion:

• Should universities expel students or rescind offers after finding racist posts? If so, under what circumstances?

• Should students know better—both morally and practically—than to post racist comments, memes, videos, etc.?

• Analyze and compare the two university statements. Who are the primary and secondary audiences? How well does each convey the main points, balancing various audience needs?

Facebook's Position on Twitter's Labeling

Facebook CEO Mark Zuckerberg weighed in on Twitter’s decision to fact-check and label some of President Trump’s tweets. In response to protests after the death of George Floyd, one tweet promised “when the looting starts, the shooting starts.” Twitter hid the tweet with a note that it “violated the Twitter Rules about glorifying violence.”

Another tweet claimed that “mail-in voting will lead to massive fraud and abuse,” and Twitter posted a warning to “get the facts.” Until now, Twitter had not enforced its policies for the president’s tweets.

Facebook is taking a different tack. CEO Mark Zuckerberg described the company’s position:

"I believe strongly that Facebook shouldn't be the arbiter of truth of everything that people say online. I think in general, private companies shouldn't be, especially these platform companies, shouldn't be in the position of doing that."

The Wall Street Journal editorial board defended Zuckerberg’s decision: “We wish Facebook would take a lighter touch when it comes to political speech overall.”

Image source.

Discussion:

• What’s your view of Twitter’s actions? Why do you think the company began labeling President Trump’s tweets now?

• Should Facebook follow suit? How might each company’s mission play a role in its actions?

Jenner Pays for Frye Festival Post

The U.S. Federal Trade Commission (FTC) requires that paid endorsements are not misleading. Celebrities like Kendall Jenner cannot post support on social media for a product or organization without specifying that she is being paid to do so. The FTC publishes Endorsement Guides to clarify responsibilities.

Jenner promoted the 2017 failed Frye Festival, implying that Kanye West might perform. Although she was paid $275,000, she didn’t reveal the sponsorship. She has since been sued and will pay a $90,000 settlement, which may help some of the many associates of the festival who lost money in the venture.

To learn more about what happened to the Frye Festival—a major public relations and communication failing—see documentaries on Hulu and Netflix.

Frye image source.

Discussion:

• What are the ethical implications of celebrities endorsing products?

• When a celebrity endorses a product, are you more likely to buy it?

• If you’re familiar with the festival, describe what went wrong.

A Leader Example in My Book Is Charged With Conspiracy

I was sad to see that Paul Kruse, former CEO of Blue Bell Creamery, has been charged with covering up the listeria breakout in 2015. In my book, Building Leadership Character, Kruse is a positive example of a leader who demonstrates vulnerability. His 2016 video announcing employee layoffs after the breakout was emotional and authentic.

Prosecutors say that Kruse delayed recalling tainted products, instructed employees to tell customers that product delays were caused by mechanical problems, and failed to take other appropriate action.

Blue Bell agreed to pay $19.5 million to the Department of Justice and posted a statement on its website, which focuses more on the future than on the past.

Discussion:

• Can you reconcile both perspectives of Kruse as a leader? Could he be someone who covers up listeria and someone who gets emotional when talking about employee layoffs?

• Assess the company’s statement. Who are the audiences, and what are the communication objectives?

Companies That Returned Federal Funding

Controversy swirls as companies grapple with whether to keep or return federal funding for the COVID-19 crisis. Distributions from the Paycheck Protection Program (PPP) seem unfair as some small businesses—the intended recipients—can’t get forgivable loans, while some larger businesses received millions of dollars that, at least in some cases, isn’t needed as emergency funding.

As the first and most highly publicized company, Shake Shack returned $10 million. Forbes tallies several others, including Ruth’s Hospitality Group, Sweetgreen, and the Los Angeles Lakers.

Store image source. Food image source.

Discussion:

• What’s your view of companies that returned money compared to those that didn’t?

• How should a company decide whether to return the funding?

• Shake Shack doesn’t include a press release on its website or a tweet about the decision. What’s your view of this approach? Should the company promote the decision more boldly? Why or why not?

Lysol Disputes Claims of Cure

During his press conference, President Trump questioned whether disinfectants could be used internally to fight the new coronavirus:

“I see the disinfectant that knocks it out in a minute, one minute. And is there a way we can do something like that by injection inside, or almost a cleaning? Because you see it gets inside the lungs and it does a tremendous number on the lungs, so it would be interesting to check that.”

The president later said, “I was asking a question sarcastically to reporters like you just to see what would happen.” But Lysol executives are concerned that people may take the idea seriously and try to treat themselves. Reckitt Benckiser, which makes Lysol products, issued a statement, “Improper Use of Disinfectants.”

Lysol image source.

Discussion:

• Watch the president’s comment during the press conference. What’s your view of his speculation?

• Analyze the Lysol maker’s response. What works well, and what could be improved? What is appropriate or inappropriate for a brand’s parent to dispute the president’s claim in this way?

Employees Seek Better Benefits from Applebee's and IHOP

Employees of Applebee’s and IHOP are asking for better benefits from the restaurants’ parent company, Dine Brands.

The group’s website, Applebeesisrotten, paints a dire picture of the impact of the pandemic on restaurant workers and asks people to sign their petition for “comprehensive paid sick leave, paid family and medical leave, and income relief to all works.”

A tweet posted on April 22 indicates that company executives haven’t responded to the group’s demands.

Discussion:

• Analyze the group’s use of persuasive strategies on the website. How well do they balance logic, emotion, and credibility? What suggestions for improvement would you offer?

• The petition shows less than 7,000 signatures as of today. What, if any, effect might this have on the executives’ response.

• Should the executives respond? If so, how?

Improving Column Charts

So many charts about COVID-19 could be improved. Here’s one from a Business Insider article, which compares death rates for the flu and COVID-19.

Discussion:

• What issues do you see in the graphic? (Hint: Check the x axis, and describe what the percentage on the y axis represents.) How would you fix the problems?

• What are the consequences of designing charts in this way?

• Find another recent chart to analyze. In what ways does the graphic convey information accurately, and how does it fall short?

Luckin COO Fabricated Sales Data

Luckin’ Coffee, China’s largest coffee chain, is suffering the consequences of publishing false sales numbers. Ernst & Young discovered the misconduct, which took place in 2019, during an audit, concluding that “management personnel engaged in fabricated transactions which led to the inflation of the Company’s income, costs and expenses.” An investigation blames the chief operating officer and others.

A report details “the fraud and the fundamentally broken business,” including “smoking gun” evidence and “red flags.” The anonymous authors compare video recordings of store foot traffic to reported sales.

In response to the news, Luckin’s stock declined between 75 and 80%. Starting in February, when the anonymous report was made public, the company has been posting notices about the situation on its website.

Discussion:

• Analyze the anonymous report, including the audiences, objectives, organization, writing style, etc. What works well, and how would suggest that the writer improve the report?

• How well did the company address concerns? Begin with the first response in February.

• What leadership character dimensions does this situation illustrate?

WHO Official Bungles Interview

World Health Organization (WHO) senior adviser Bruce Alyward wanted to avoid a reporter’s question about Taiwan becoming a member of the organization. A video of the interview shows an awkward exchange, with Alyward remaining silent (but we still see him moving and hear sounds), saying “Sorry, I couldn’t hear your question,” asking the reporter to move onto another question, and then, finally, ending the call. During a follow-up call, Alyward refers to China and then abruptly ends the call.

Taiwan has had good success in controlling COVID-19, and the government claims to have warned the WHO back in December 2019 about the contagion.

As of today, Alyward’s name is removed from WHO’s website listing advisers to the organization.

Discussion:

• What is a better way for Alyward to have handled the reporter’s question?

• Why do you think the WHO ignored warnings from the Taiwanese government?

Email Scammers

Remember those quaint email scams that were riddled with grammatical errors? A Wall Street Journal article describes new, sophisticated training for email scammers in Africa. A Nigerian is quoted: “You know how you guys play baseball when you are growing up? Here many of us learn fraud.”

Former scams involved people sending email asking for money for people in trouble or promising big returns on small funds. Today’s scams involve hacking into accounts and people learning about connections, for example, what vendors a company uses. A fake invoice to a known vendor is more likely to get paid. Using a grandson’s real name could lead a grandmother to Wal-Mart to send money to him, which happened to my friend’s mother.

About $1.7 billion was lost to email scams in 2019, and complaints are rising steadily. The article describes a “grooming” process “like organized crime.”

Discussion:

• We hear a lot about victims’ vulnerability, but what creates a culture of scammers? What makes people vulnerable to commit this fraud? For more about this, watch The Weekly documentary about love scams on Facebook.

• What’s your view of the bar chart in the WSJ article? How could it be improved? Would you prefer a more creative graphic, or does this work as is?

Comparing Headlines About the Market

How does the media describe the recent stock market decline? Let’s compare a few headlines:

• Dow falls 1,191 points -- the most in history (CNN)

• Coronavirus Drives Stocks Down for 6th Day and Into Correction (New York Times)

• U.S. Stocks Slide Into a Correction as Virus Fears Show No Sign of Easing (Wall Street Journal)

• Dow's point drop worst on record as stocks fall into correction (Fox News)

• Dow drops 1190 points amid coronavirus fears, S&P 500 sees fastest correction in history (Yahoo Finance)

Of the five, Fox is the only one that didn’t place a headline about the market at the top of its web page.

Discussion:

• What do you make of these headline choices, including placement? What might the wording indicate about the media group’s beliefs or audience?

• In class after a previous decline, I took issue with headlines like CNN’s. Do you see an issue? (Hint: What does a raw number tell us?)

MLB Players Dispute Response to Cheating Scandal

Several players have criticized how Major League Baseball Commissioner Rob Manfred handled the recent cheating scandal. Calling the Houston Astros’ sign-stealing “the biggest scandal in the sport since the steroid era,” an ESPN writer concludes that “fallout continues.”

In an interview, Manfred explained the decision to recall the Astros’ 2017 World Series title and how the first apology didn’t go over very well. Manfred referred to the World Series trophy as a “piece of metal.” Mike Trout of the Los Angeles Angels spoke against Manfred’s reference:

“For him to devalue it the way he did [Sunday] just tells me how out of touch he is with the players in this game. At this point, the only thing devaluing that trophy is that it says ‘commissioner’ on it.”

Manfred has since apologized:

“In an effort to make a rhetorical point, I referred to the World Series trophy in a disrespectful way, and I want to apologize for that. There’s no excuse for it. I made a mistake. I was trying to make a point, but I should have made it in a more effective way.”

NBA star LeBron James weighed in on Twitter, encouraging the MLB to “listen to your players speaking today about how disgusted, mad, hurt, broken, etc etc about this.” As expected, some appreciated his perspective, while others didn’t.

Manfred image source .

Discussion:

• What’s your view of the controversy? Are you also critical of Manfred’s handling of the situation?

• How well did Manfred handle the criticism of his “piece of metal” comment?

• Should LeBron James have entered the debate, or should he have avoided it, as some suggest? Why or why not?

Barnes and Noble Changes Course on Black History Month

To celebrate Black History Month, Barnes and Noble bookseller altered classic book covers with people of color. Reactions were not positive. The author L.L. McKinney explains her position:

“They're essentially just slapping a cover on it to 'celebrate diversity.' But a lot of us felt that you're just trying to cash in on the fact that it's Black History Month, and now all of a sudden, black faces and brown faces will sell books. Just maybe one, two years ago, people were saying in meetings, 'Yeah, you can't put black people on covers. It's not going to sell the book.'“

Discussion:

• What’s your view of the original campaign? How would you describe the backlash?

• Assess the statement from Barnes and Noble. How well did the company address and respond to concerns?

Wells Fargo Former CEO Banned

In what the Wall Street Journal calls “unprecedented” and “an extraordinary sanction for a top executive at a large bank,” former CEO John Stumpf has been barred from the banking industry. The decision—and a $17.5 million fine—were part of a settlement between Stumpf and the Office of the Comptroller of the Currency (OCC) for millions of fake bank accounts created at Wells Fargo.

The OCC concluded that Stumpf should have known of the systemic problems and that “there was a culture in the Community Bank that resulted in systemic violations of laws and regulations.” When the scandal became public, employees complained of extreme stress because of pressure to sell more bank products. This pressure led employees to create fake accounts for customers.

Other Wells Fargo executives have been fined and charged, but none have been banned from the industry.

Image source.

Discussion:

• Do you think the decision is fair? Why or why not?

• This decision represents a shift from the 2008/2009 financial crisis, when banks paid significant fines but very few individuals were charged. What’s your view of the change?