Facebook Inc (NASDAQ:FB) has revealed that a bug in its system caused a number of people viewing pages to be inaccurately reported to page administrators.
The bug has been affecting counts of user activity since last Autumn. The social networking company is implementing fixes for the bug, and accurate counting should be restored by next Monday.
Facebook shares have fallen by about 1 percent on today's trading. The loss caps off a four-day week in which the firm's shares have lost more than 4.5 percent of their value.
The revelation that vital statistics on the platform have been misreported will not instill any greater confidence in investors.
The bug affected the Page Insights platform on mobile operating systems, specifically iOS and Android. Changes the company made to their software, which was designed to speed up the mobile applications, did not count posts properly. The bug resulted in most affected being told that their posts had reached less users than they actually had.
The bug did not have any weight on the firm's Ad Insight, Payment Insight or App Insight. That means that nobody was overcharged or undercharged for ad placement, nor did anything untoward happen with application payments. The problem, particularly from the Facebook Inc (NASDAQ:FB) mobile service will trouble investors in the social media company.
Facebook released a new application for iPhone users last August, and a new application for Android users last December. The new mobile applications were designed to speed up use. They did this by transmitting the smallest amount of data possible. Some of the data that was stripped out, however, was useful, and it was used in the Page Insights service.
In order to be useful to advertisers, and therefore make money, Facebook needs to be reliable. Though advertising data was not the problem here, the announcement that the company's statistics were inaccurate in one area might lead to an associated mistrust of other Facebook statistics. The company will have to work hard to shift this perception.
This story is not important in itself, but it does demonstrate the reality that Facebook investors have to face. Headline pressure is unpredictable on Facebook Inc (NASDAQ:FB) because it is so widely covered.
It is difficult to predict how stories will alter the stock price. Death by a million paper cuts, as general perception turns against the company, may be around the corner.