The recent global outage of Facebook-owned platforms has reportedly taken a toll on the tech giants plans to fintech services.
The over six-hour outage across Facebook, WhatsApp, and Instagram, left an estimated 3.5 billion global users and businesses disconnected.
Outage tracker, Downdetector reported that there were over 10.6 million problem reports globally due to the outage.
Facebook Founder and CEO, Mark Zuckerberg reportedly lost a whopping US$6 billion due to a plummet in Facebook shares as a result of the outage.
Influencers and small businesses
But Zuckerberg was not the only loser as some influencers and small businesses, which use Facebook, Instagram and WhatsApp for their trade, lost as much as $5,000 each in sales.
They therefore plan reduce their reliance on Facebook’s platforms to advertise and sell products going forward.
The decision of the small business and influencers is therefore threatening to have a lasting impact on Facebook’s plans to facilitate its users’ access to financial services.
Facebook had in August 2020 launched a new division to oversee all its payments projects, like the stablecoin Diem. In July this year, it also made Facebook Pay available on third-party platforms, starting with Shopify.
But the latest global outage has escalated Facebook’s already tarnished reputation and heightened regulatory pressures even further.
Again, the recent controversies surrounding leaks and testimony from former Facebook product-manager-turned-whistleblower Frances Haugen, combined with the global outage, has dealt a further blow to Facebook’s reputation.
This is particularly problematic for Facebook’s fintech solutions, because of concerns about people’s financial data, which is exceptionally sensitive.
The outage revealed that all of Facebook products run on a single system. It means Facebook has created a single point failure in a bid to converge and cut cost. Regulators may find this particularly troublesome, since more than 200 million businesses use Facebook platforms for their operations.
Regulators are already pushing for curtailing the dominance of Big Tech’s, and the Facebook global outage may encourage further regulatory restrictions to mitigate greater financial risk.