The Herald Bulletin

Morning Update

Local Business

January 15, 2013

Emmett Dulaney: Are Facebook postings ‘public’?

Today’s question to ponder: How many people need to have access to something before it becomes classified as public?

Of all the forms of social media available, Facebook is a leader when it comes to the numbers game. If the more than 1 billion user accounts were to represent unique users, then it could be reasoned that close to one-sixth of the world’s population has a Facebook account. As a very minor point, it needs to be pointed out that not every user is a unique user since some accounts represent businesses and some individuals have multiple accounts. Given the size of the user base and the fact that more people access Facebook — and spend more time there when they do — than almost anything else, can information posted on Facebook be considered public?

The reason this issue is relevant has to do with a disagreement between the CEO of Netflix and the Securities and Exchange Commission (SEC). The SEC enforces something called “Regulation Fair Disclosure” that requires all publicly traded companies to publicly release any information about their company that could influence investors’ decisions. Not only must they make the information known, but they also have to do so in a way that discloses it to all investors at the same time. It is partially because of this regulation that press releases and press calls/conferences are so commonplace.

Last summer, though, the CEO of Netflix chose to announce on Facebook — not in a press release or at a press conference — that for the first time ever, the company exceeded 1 billion hours of video streaming in a month. That is a milestone number and one that could easily influence a buy or sell decision as reflected by a 13 percent rise in the stock’s price the day of the posting (July 5, 2012).

The SEC does not consider Facebook to be a public medium and has threatened to sue the company for violating the fair disclosure rule. The CEO had 245,000 subscribers to his account on Facebook at the time of the posting and his postings could be viewed by anyone who chose to look at them whether they were a subscriber or not. It can also be argued that there is not a one-to-one correlation between the number of hours of streamed video and the profitability of the company (they don’t, for example, make $1 for every hour of video), and thus the number released may not be thought of as being “material,” but the rise in stock price points otherwise.

Those details aside, the real question we started with remains: How many people need to have access to something before it becomes classified as public? Surely, 1 billion has to be nearing that number. The SEC could not have imagined the existence of Facebook or any form of social media when Regulation Fair Disclosure was drafted. Just as not every investor has access to Facebook, not every investor may be available for the other forms of information when they are used. Have we not now entered an age where the SEC and others should expect and accept information to move to, and utilize, these new channels?

Columns from the Falls School of Business at Anderson University appear Tuesdays in The Herald Bulletin. This week’s columnist, Emmett Dulaney, teaches marketing and entrepreneurship.

 

1
Text Only
Local Business
  • Travel restrictions on Interstate 69 this weekend During at least the next eight weekends, travel north of Anderson on Interstate 69 will be restricted as damaged concrete is repaired.

    July 22, 2014

  • Senior housing request continued A request for final plat approval for a senior housing development on property near Madison Park Church of God was continued Tuesday. The Anderson Plan Commission could not consider the request because of a lack of a quorum to conduct business.

    July 22, 2014

  • Street Department purchases 2 pickup trucks The Anderson Street Department received approval to buy two Dodge Ram pickup trucks on Tuesday.

    July 22, 2014

  • FEA - HB0722 - SAVI - 1 Staying strong during adversity

    When doctors told Judy Best she had cancer she was shocked, but she never lost hope.

    July 22, 2014 2 Photos

  • NWS - HB0721 - 4-H parade 3 - DH Scholarship recipients relish parade acknowledgement

    Taylor Jennings and Shelby Farmer took their last stroll around their hometown Sunday. At least, their last before starting college in the fall.

    July 20, 2014 5 Photos

  • Senior housing sought for Madison Park A senior housing development proposed almost six months ago for the Madison Park Church of God property is now moving forward.

    July 20, 2014

  • Wilkerson, Jesse mug Jesse Wilkerson: Unplug to reconnect I am inspired and influenced by people in our community who are creating a legacy of service. These people have disconnected long enough to realize there is more to their life than their job or personal success.

    July 20, 2014 1 Photo

  • BIZ-HB0720-Coldbeer-TM.jpg Brouhaha over cold beer

    Warm beer lines the shelves inside the Ricker’s BP on Eighth Street less than a foot from a refrigerated section, but the convenience store is not planning to move the beer anytime soon. That’s because a state law prohibits Ricker’s from selling cold beer to customers.

    July 19, 2014 1 Photo

  • Biz- HB0720 - HP Cycle Ski Biz Profile- TM Business Profile: Cycle shop owners fix-ated on power sport equipment When Mark Hains and Michael Palmieri opened a service and repair shop for power sport equipment, they were prepared to heavily invest in their dreams.

    July 19, 2014 1 Photo

  • Business People: July 20 A compilation of news items featuring members of the Madison County business community.

    July 19, 2014

Stocks
Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide