Despite a number of recent controversies and privacy scandals, users still don’t want to give up their Facebook accounts.
A new study published in PLOS One attempted to quantify Facebook’s value to users by finding out the minimum amount of money it would take to get people to deactivate their accounts for certain periods of time. Since Facebook is a free service, the researchers chose this method as a twist on the consumer surplus estimate – interpreting consumers’ net benefit by finding the difference between what someone actually pays for a product and the most he would be willing to pay for that same product.
Across three different samples of people, the mean minimum individuals were willing to accept to turn off their accounts for one year was more than $1,000 – suggesting the value of Facebook’s platform to its 2 billion users is higher than the company’s actual market capitalization (more than $370 billion).
The study also shows that consumers value the service despite a recent string of negative media coverage, which began with the Cambridge Analytica scandal in the run-up to the 2016 presidential election – after which it was revealed that hackers used the platform in an attempt to influence the U.S. election.
In September, Facebook said hackers gained access to the phone numbers and email addresses of millions of users.
Executives Mark Zuckerberg and Sheryl Sandberg have both testified before lawmakers regarding user privacy.
Shares of the social media giant are down more than 25 percent this year.