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Facebook makes a ton of sense when you realize their big gamble was that people would stop caring about privacy long before they realized how much Facebook was recklessly gathering and sharing.
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The fact that updates like these weren't popular wasn't a mistake - they were a part of a years-long campaign to change the culture around privacy. From 2011: theatlantic.com/technology/archive/2011/09/the-problem-with-facebooks-new-frictionless-sharing/245578/
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Facebook's first product being the physical manifestation of people's main fear about Facebook, that they're constantly listening to you to serve ads (wired.com/story/facebooks-listening-smartphone-microphone/), can only make sense through this lens.
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Obligatory DF link: daringfireball.net/linked/2018/10/16/facebook-portal gruber not signing up may end up being his most prescient decision ever.