The Business Times

WhatsApp co-founder leaving Facebook amid data dispute

Jan Koum was perturbed by amount of info social network collected on people: source

Published Tue, May 1, 2018 · 09:50 PM

San Francisco

WHEN Jan Koum, a founder of the messaging app WhatsApp, sold the service to Facebook in 2014, he explained how deeply he cared about the privacy of communication. Growing up in the Soviet Union during the 1980s - when surveillance was a fact of life - had made him realise the importance of being able to speak freely, he wrote.

"Respect for your privacy is coded into our DNA, and we built WhatsApp around the goal of knowing as little about you as possible," Mr Koum wrote in a blog post after he had sold WhatsApp to Facebook for US$19 billion. "If partnering with Facebook meant that we had to change our values, we wouldn't have done it." Now, instead of changing his values, Mr Koum is leaving Facebook.

On Monday, Mr Koum, 42, a member of Facebook's board of directors, said in a post on the social network that "it is time for me to move on". He did not give a reason for his exit.

But according to a company executive, who asked not to be identified because the details of Mr Koum's departure were confidential, Mr Koum had grown increasingly concerned about Facebook's position on user data in recent years. Mr Koum was perturbed by the amount of information that Facebook collected on people and had wanted stronger protections for that data, the person said. Mr Koum had discussed leaving the company since late last year, the person added.

Mr Koum's exit is the highest-profile departure from Facebook after months of controversy that has roiled the social network. The Silicon Valley company has been under scrutiny for how Russian agents used it to influence voters before the 2016 presidential election and, more recently, for a lack of data protections for its more than 2.2 billion members, a subject that gained attention after revelations that British political consulting firm Cambridge Analytica had improperly harvested the information of as many as 87 million Facebook users.

The controversies have prompted disagreements among top Facebook executives about how to deal with those issues. In March, The New York Times reported that Alex Stamos, Facebook's chief information security officer, intended to leave the company after an internal dispute over how to handle the threat of Russian influence efforts. Facebook has also reshuffled the top ranks of its Washington office, where lobbying and policy matters are handled.

Mr Koum's decision was earlier reported by The Washington Post.

Facebook's business depends on getting people to spend time on its sites and allowing advertisers to target users based on their interests. WhatsApp has had no advertising on its service, but in recent years it has been sharing more information about its users with Facebook.

In March, Brian Acton, who co-founded WhatsApp with Mr Koum and who has since left the company, wrote on Twitter that it was time to delete Facebook after the Cambridge Analytica revelations.

Mr Koum and Mr Acton, who met at Yahoo while doing a security audit for the company, founded WhatsApp in 2009. Originally, the service was a way for people to tell friends and family whether they were available to text and talk. But it soon morphed into a general and free way of sending messages without the help of the services run by cellular network operators like Verizon and AT&T.

WhatsApp became enormously popular in countries where messaging services were expensive or where social networks like Facebook had not taken hold. By February 2014, WhatsApp had about 450 million users and 50 employees. Facebook's acquisition of the company turned many WhatsApp employees into millionaires.

In the spring of 2016, Mr Koum and WhatsApp revealed that it was adding end-to-end encryption to every form of communication on the company's service, which was by then used by more than one billion people across the globe. That meant that even company employees could not see messages, phone calls, photos or videos sent across the WhatsApp network, and that the company had no way of complying with any court order demanding access to those communications.

Although Mr Koum joined the board of Facebook after his company was acquired, WhatsApp continued to operate independently in many ways. Its staff remained small, and employees worked from their own office in Mountain View, California, away from Facebook's headquarters in Menlo Park, California. The Mountain View building carried the names of neither Facebook nor WhatsApp on the outside.

While WhatsApp does not carry advertising, the company has worked over the past two years to create ways for businesses to communicate with customers via its service.

In 2016, WhatsApp said it would start disclosing the phone numbers and analytics data of its users to Facebook. A year later, the European Commission fined Facebook 110 million euros (S$176 million) for misleading the commission during its acquisition of WhatsApp, saying that Facebook incorrectly claimed that it was impossible to combine user data collected by the two companies.

Last November, Mr Acton left WhatsApp and later became the executive chairman of the Signal Foundation, the nonprofit that has run the encrypted communication app Signal.

By then, Mr Koum had also shared his unease over Facebook's data and privacy policies with others, according to the company executive who has spoken with Mr Koum. While Mr Koum personally got along with Mark Zuckerberg, Facebook's chief executive, he felt the company's board simply paid lip service to privacy and security concerns he raised, according to the executive. NYTIMES

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