Facebook's disappointing first-quarter profit may pose the social networking giant less of a problem than legislation now being pushed through in the United States.
After failing to pass previous rulings such as the Stop Online Piracy Act (Sopa), the US is drafting draconian new laws, such as the Cyber Intelligence Sharing and Protection Act (Cispa), designed to allow the US government to monitor all activity on the internet including social networking sites and email accounts. Similar legislation is also being promoted by the British government.
Even before overcoming its first major hurdle by being passed by the US House of Representatives on Thursday, Cispa was already sounding alarm bells among leading industry figures such as Sir Tim Berners-Lee, the man credited with originally designing the internet, almost a quarter of a century ago.
Sir Tim says that the US's determination to monitor the internet threatens not only the rights of people in the US but those of people everywhere. He says it is "staggering" that the US should try to push through additional legislation so soon after the defeated Sopa.
The Center for Democracy & Technology (CDT), an online privacy lobby group based in the US, is also issuing a stark warning concerning the country's continuing determination to police the internet. The CDT says that Cispa has a broad, virtually unlimited definition of the information that can be accessed. It warns that once the information is shared with the US authorities, it can be used for other purposes.
The Electronic Frontier Foundation, a privacy-rights group, also warns that the provisions of the bill could be stretched to include sharing data for crimes such as intellectual-rights piracy.
"It will allow existing privacy laws to be overridden using new laws that enable too great a range of possible intelligence-gathering activities, potentially allowing too great an imposition on the consumer," says Mark Little, an analyst at the research company Ovum.
Google and Facebook already appear to be giving their cooperation to the act. Google has been in discussion with the intelligence agencies for years over access to its ocean of consumer data, and Facebook supports the tough new legislation.
But these two internet giants and other organisations supporting Cispa may soon come to regret backing legislation that may enrage many of their users who expect that personal details will be treated as confidential.
However, once their histories, personal communications, banking records and other online information have been harvested, they will have no control over how that data is used. The US Internal Revenue Service could use software to sift through social networkers' online histories to identify and prosecute tax evaders.
"If and when the new legislation is adopted, companies such as Facebook and Google could face a massive marketing problem in convincing customers that their personal lives are free from prying eyes," says Mr Little.
But even Google and Facebook may feel they must comply with the US government's requests for information where national security is concerned. The Pentagon fears that a new generation of hackers and "cyber terrorists" is plotting to bring the US to its knees by disabling vital services such as the national power grid or even by attacking its defence systems. Given that this is how the stakes are perceived, some industry watchers believe that the legislation will go ahead.
"Governments have a responsibility to defend their citizens and national interests, which the internet has made too easy to undermine," says Mr Little. "The intelligence community will argue strongly and probably successfully that Cispa is key to improving America's cyber-defence capability. The Pentagon is likely to argue that the Cold War may be over but the 'soft war' has begun, and [that] they're already behind."
But the repercussions of the new digital "soft war" may stretch much farther than Facebook anticipates, particularly in the light of its forthcoming initial public offering.
"Cispa could damage trust in online services yet again, another blow that might finally dampen Americans' enthusiasm for the internet economy," says Mr Little.