Lawsuit: "pivoting to video" was a disaster led by Facebook's cooked viewing data

Several years ago media sites began firing writers en-masse to hire video people instead, because Facebook and other social media companies told them that this was the future. "Pivoting to video," some called it. But what Facebook actually delivered was "fraudulent" analytics. Advertisers slowly figured out the videos weren't being watched. Facebook lied about it for a while. Then it apparently admitted it. Then the media sites started firing the video people too.

Here's an excerpt from a lawsuit unsealed yesterday, posted to Twitter by Jason Kint, the CEO of an online publishers' trade group.

63. In June 2016, a Facebook engineering manager finally followed up on advertiser complaints dating back to early 2015, writing that "[s]omehow there was no progress on the task for a year." But even once it was decided to take action on the metrics, Facebook did not promptly fix its calculation or disclose that the calculation was wrong. Instead, it continued reporting miscalculated viewership metrics for another several months, as it developed a "no PR" strategy to avoid drawing attention to the error. The company decided to "obfuscate the fact that we screwed up the math" by quietly retiring the erroneous metrics and replacing them with corrected metrics under a new name. For instance, Average Duration of Video Viewed would be replaced with Average Watch Time.

64. In August 2016, Facebook began reaching out privately to select, large advertisers, telling them that Facebook had "recently discovered a discrepancy" in the video ad average view metrics. Facebook pushed that message even as personnel internally emphasized that "we didn't recently discover a discrepancy." (emphasis added).

Adds Kint: "[the] preliminary report claimed Facebook’s avoidance of answers reached “point of obfuscation.” Now we have a suit of fraud allegations based on internal documentation that obfuscation was the actual strategy."

Aspects of the underlying problem were reported as long ago as 2016, but now we're finding out the gory details of how publishers blithely upended their content models on the basis of third-party metrics and just how badly Facebook cooked the books.

Suzanne Vranica in the WSJ:

A group of small advertisers filed a lawsuit in California federal court in 2016, alleging the tech giant engaged in unfair business conduct by disseminating inaccurate metrics that significantly overestimated the amount of time users were spending watching video ads. The plaintiffs later added a fraud claim, and in Tuesday’s court filing they alleged Facebook knew of irregularities in its video metrics by January 2015 and understood the nature of the miscalculation within a few months, but failed to disclose the information for over a year.

The filing followed the plaintiffs’ review of some 80,000 pages of internal Facebook records that they obtained as part of court proceedings. The complaint, which cites the internal Facebook documents, also alleges that the scale of the miscalculation was far worse than understood.

“Facebook’s internal efforts behind the scenes reflect a company mentality of reckless indifference toward the accuracy of its metrics,” the plaintiffs said in Tuesday’s filing.

Facebook's "measurement errors" seem to be a systematic problem.

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