As distractions go, it couldn't have been better timed.

Just as Facebook founder Mark Zuckerberg's corporate juggernaut was being engulfed by a crisis it steadfastly had refused to confront for years, Donald Trump rode to the rescue, upping the ante in his ongoing trade skirmish with China.

It wasn't as though Facebook escaped the caning meted out by Wall Street over Trump's latest assault on global trade, shedding a further couple of per cent to extend losses to 10 per cent in just eight trading sessions.

But the trade fight provided welcome respite to the escalating crisis threatening to spill over into the broader technology sector, whose soaring share prices have helped propel Wall Street's extraordinary performance in recent years.

Zuckerberg finally apologised for the failures last week, and has since used ads in multiple US and UK newspapers to say sorry.

But there is more to revelations than a shadowy consultancy used Facebook to mine the personal data of millions of individuals to try to influence the election.

Technically, at least according to Facebook, Cambridge Analytica — once run by former Trump adviser Steve Bannon — did not breach its privacy provisions when it accessed psychometric data on 270,000 users and further data on up to 50 million Facebook profiles.

After all, that's Facebook's big secret: it allows thousands of organisations access to the personal data of its users.

That's how it makes its money.

And that goes some way to explaining why it has done nothing about Cambridge Analytica, a full year after announcing the group had been suspended from its site because an operative, Alexandre Kogan, had lied about deleting the data.

If it wasn't for the sting last week on Cambridge Analytica executives, bragging about the underhand tactics they employ on behalf of wealthy clients, this all conveniently would have been forgotten.

Sorry, this video has expired Cambridge Analytica claim they invented "Crooked Hillary" moniker

Social media and the decline of journalism

So far, most of the concerns about the affair have centred on privacy. But that should have been obvious to anyone who has ever used the social media site.

Millions of users reveal intimate and highly personal information: the kind of intelligence they would never give to government.

The bigger concern is how the data was manipulated, deliberately targeting American citizens during the most recent presidential election to potentially influence the vote.

There's also a third and vitally important worry.

The rise of Google, Twitter and Facebook has laid waste to traditional media companies globally.

Tens of thousands of journalists have been sacked in the past decade, close to 200 US newspapers have closed since 2008 and those that remain in business are shadows of their former glory.

Electronic media also has been similarly hit.

Mostly, the changes sweeping the industry have been dismissed as a case of technological change: a change traditional owners who relied upon advertising dollars to fund journalism either didn't see coming or were too slow to adapt.

That may be the case. But the effect is far more pernicious.

The fourth estate, a vital pillar of democracy, has been left reeling.

What's replaced it is a data-harvesting, all-seeing avenue of social manipulation, relying on secrecy while posing as a harmless avenue of communication.

The secret life of Facebook

When Facebook listed on Wall Street's Nasdaq Exchange in May 2012, it was an unmitigated flop.

Mark Zuckerberg's corporate juggernaut Facebook is engulfed by a crisis. ( Reuters: Stephen Lam )

The stock tanked on day one and, a year later, was 30 per cent down on the $42 listing price.

Even for a sector that traditionally was prepared to overlook a lack of earnings or profit and instead focus on promises of future growth, investors fretted about Facebook.

It didn't appear to have a solid earnings stream.

Google, it was argued, had a better strategy soaking up advertising dollars from a struggling traditional media sector.

To make matters worse, founder Mark Zuckerberg and other seed investors were flooding the market with stock.

What small investors were not aware of, was that just a week before Facebook was listed, it revised down its earnings forecasts and while it resubmitted accounts to the authorities, it didn't specify the extent of the revisions, leading sophisticated investors to switch bets and sell the stock from day one.

Facebook began life as a public company shrouded by an air of secrecy.

The Kremlin's direct line to Main Street

In the past five years, Facebook has perfected its business model.

It recently reported fourth-quarter, 2017 earnings of $US4.3 billion as its brutally efficient targeted advertising strategy raked in the cash.

It still lags Alphabet, Google's parent, which pulled in $US6.8 billion. But until last week, Facebook and its share price were on a roll.

Those advertising dollars — $US11 billion in just 12 weeks — once flowed through to old-style media companies that used that cash to fund journalism.

Those companies and their employees were visible and accountable to their readers and viewers.

These days, 45 per cent of Americans get their news from Facebook. But there is precious little oversight on whether or not the sources of that news are legitimate or deliberately attempting to mislead the public.

ABC Media Watch's Paul Barry last year compiled a disturbing special report on Facebook and Twitter's role in the most recent presidential election.

Most concerning was the influence of a Russian bot factory — the Internet Research Agency in St Petersburg — which transmitted 80,000 Facebook posts that reached 126 million Americans during the election campaign.

The influence goes deeper than just trying to influence elections.

A divide-and-conquer strategy to sow social discord appears to be underway.

Barry highlighted a 2016 Facebook campaign by a group calling themselves The Heart of Texas, which organised a rally to "Stop The Islamisation of Texas".

A rival group, supporting Islam, took umbrage and organised a protest. On the allotted day, the two groups met to slug it out. But the organisers were nowhere to be seen.

Either they didn't exist, or there were no available flights from St Petersburg.

Google's fake news initiative

A few days before Facebook shares tanked and a nervous Zuckerberg tried in vain to hose down the controversy, the company's main rival Google announced plans to fight "fake news" with a $300 million grant to fund quality journalism.

What a change from the denials just nine months ago from Google's Australian head, Jason Pellegrino.

Google has announced plans to fight "fake news". ( Google )

"We've been accused of stealing other people's content, stripping revenue from publishers and not contributing to the journalism ecosystem," he wrote in the Australian Financial Review. "None of this is correct."

That kind of money is a tokenistic drop in the ocean for a company that hoovers up more than $US120 billion in advertising revenue annually. But at least it's a recognition of the damage it is causing.

Facebook, meanwhile, faces much greater challenges.

New privacy laws to be introduced in Europe in May could throw a spanner into its entire business model.

Not only can users opt out of the data-sharing arrangements most don't even realise they've signed up for, huge penalties — in the order of billions of dollars — could be levied against the social media giants for breaches.

That's a distraction Zuckerberg, and Wall Street, can ill-afford to ignore.