[Infowarrior] - Facebook Retreats on Online Tracking

[Richard Forno]

November 30, 2007
Facebook Retreats on Online Tracking
By LOUISE STORY and BRAD STONE

http://www.nytimes.com/2007/11/30/technology/30face.html?_r=1&hp=&pagewanted
=print&oref=slogin

Faced with its second mass protest by members in its short life span,
Facebook, the enormously popular social networking Web site, is reining in
some aspects of a controversial new advertising program.

Within the last 10 days, more than 50,000 Facebook members have signed a
petition objecting to the new program, which sends messages to users¹
friends about what they are buying on Web sites like Travelocity.com,
TheKnot.com and Fandango. The members want to be able to opt out of the
program completely with one click, but Facebook won¹t let them.

Late yesterday the company made an important change, saying that it would
not send messages about users¹ Internet activities without getting explicit
approval each time.

MoveOn.org Civic Action, the political group that set up the online
petition, said the move was a positive one.

³Before, if you ignored their warning, they assumed they had your
permission² to share information, said Adam Green, a spokesman for the
group. ³If Facebook were to implement a policy whereby no private purchases
on other Web sites were displayed publicly on Facebook without a user¹s
explicit permission, that would be a step in the right direction.²

Facebook, which is run by Mark Zuckerberg, 23, who created it while an
undergraduate at Harvard, has built a highly successful service that is free
to its more than 50 million active members. But now the company is trying to
figure out how to translate this popularity into profit. Like so many
Internet ventures, it is counting heavily on advertising revenue.

The system Facebook introduced this month, called Beacon, is viewed as an
important test of online tracking, a popular advertising tactic that usually
takes place behind the scenes, where consumers do not notice it. Companies
like Google, AOL and Microsoft routinely track where people are going online
and send them ads based on the sites they have visited and the searches they
have conducted.

But Facebook is taking a far more transparent and personal approach, sending
news alerts to users¹ friends about the goods and services they buy and view
online.

Charlene Li, an analyst at Forrester Research, said she was surprised to
find that her purchase of a table on Overstock.com was added to her News
Feed, a Facebook feature that broadcasts users¹ activities to their friends
on the site. She says she did not see an opt-out box.

³Beacon crosses the line to being Big Brother,² she said, ³It¹s a very, very
thin line.²

Facebook executives say the people who are complaining are a marginal
minority. With time, Facebook says, users will accept Beacon, which Facebook
views as an extension of the type of book and movie recommendations that
members routinely volunteer on their profile pages. The Beacon notices are
³based on getting into the conversations that are already happening between
people,² Mr. Zuckerberg said when he introduced Beacon in New York on Nov.
6.

³Whenever we innovate and create great new experiences and new features, if
they are not well understood at the outset, one thing we need to do is give
people an opportunity to interact with them,² said Chamath Palihapitiya, a
vice president at Facebook. ³After a while, they fall in love with them.²

Mr. Palihapitiya was referring to Facebook¹s controversial introduction of
the News Feed feature last year. More than 700,000 people protested that
feature, and Mr. Zuckerberg publicly apologized for aspects of it. However,
Facebook did not remove the feature, and eventually users came to like it,
Mr. Palihapitiya said. He said Facebook would not add a universal opt-out to
Beacon, as many members have requested.

MoveOn.org started the anti-Beacon petition on Nov. 20, and as of last night
more than 50,000 Facebook users had signed it. Other groups fighting Beacon
have about 10,000 members in total. Facebook, they say, should not be
following them around the Web, especially without their permission.

The complaints may seem paradoxical, given that the so-called Facebook
generation is known for its willingness to divulge personal details on the
Internet. But even some high school and college-age users of the site, who
freely write about their love lives and drunken escapades, are protesting.

³We know we don¹t have a right to privacy, but there still should be a
certain morality here, a certain level of what is private in our lives,²
said Tricia Bushnell, a 25-year-old in Los Angeles, who has used Facebook
since her college days at Bucknell. ³Just because I belong to Facebook, do I
now have to be careful about everything else I do on the Internet?²

Two privacy groups said this week that they were preparing to file privacy
complaints about the system with the Federal Trade Commission. Among online
merchants, Overstock.com has decided to stop running Facebook¹s Beacon
program on its site until it becomes an opt-in program. And as the
MoveOn.org campaign has grown over the past week, some ad executives have
poked fun at Facebook users.

³Isn¹t this community getting a little hypocritical?² said Chad Stoller,
director of emerging platforms at Organic, a digital advertising agency.
³Now, all of a sudden, they don¹t want to share something?²

Facebook users each get a home page where they can volunteer information
like their age, hometown, college and religion. People can post photos and
write messages on their pages and on their friends¹ pages.

Under Beacon, when Facebook members purchase movie tickets on Fandango.com,
for example, Facebook sends a notice about what movie they are seeing in the
News Feed on all of their friends¹ pages. If a user saves a recipe on
Epicurious.com or rates travel venues on NYTimes.com, friends are also
notified. There is an opt-out box that appears for a few seconds, but users
complain that it is hard to find. Mr. Palihapitiya said Facebook is making
the boxes larger and holding them on the Web pages longer.

Mr. Green of MoveOn.org said that his group would be tracking the effects of
the latest changes before deciding if it would still push for a universal
opt-out.

The whole purpose of Beacon is to allow advertisers to run ads next to these
purchase messages. A message about someone¹s purchase on Travelocity might
run alongside an airline or hotel ad, for example. Mr. Zuckerberg has
heralded the new ads as being like a ³recommendation from a trusted friend.²

But Facebook users say they do not want to endorse products.

³Just because I use a Web site, doesn¹t mean I want to tell my friends about
it,² said Annie Kadala, a 23-year old student at the University of North
Carolina at Chapel Hill. ³Maybe I used that Web site because it was
cheaper.²

Ms. Kadala found out about Beacon on Thanksgiving day when her News Feed
told her that her sister had purchased the Harry Potter ³Scene It?² game.

³I said, ŒSusan, did you buy me this game for Christmas?¹² Ms. Kadala
recalled. ³I don¹t want to know what people are getting me for Christmas.²