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> This update does not expand our ability to share data with Facebook.

But does it expand their ability to share data with Instagram or some other system? It's not clear to me.

> Facebook Chief Executive Officer Mark Zuckerberg has made private messaging a top priority moving forward

Why? Because private messaging has business potential? Is Facebook planning to monetize private messaging? How?

I'll guess that Zuckerberg's definition of "private" is not at all the same as yours or mine. Personally I'd define "private messaging" to mean a way of talking with other people (via tech, obvs) such that nobody else knows anything about it - neither content nor metadata/network. But there's another possible definition, much looser, along the lines of "Having a conversation with somebody else" with no significant restrictions on eavesdropping or metadata collection - something closer to having a "private" conversation in an airport lounge: it's not intended to be heard by anyone other than the participants, but who knows who's listening in.
For most people email is private enough. I think nowadays the smtp to smtp communication is encrypted (mostly?) but it used to be in plain text.