Beware of Facebook!

Social Web site publicizes users' online purchases

Ellen Nakashima, Washington Post

Friday, November 30, 2007

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(11-30) 04:00 PST Washington --

Sean Lane's purchase was supposed to be a surprise for his wife. Then it appeared as a news headline - "Sean Lane bought 14k White Gold 1/5 ct Diamond Eternity Flower Ring from overstock.com" - last week on the social networking Web site Facebook.

Without Lane's knowledge, the headline was visible to everyone in his online network, including 500 classmates from Columbia University and 220 other friends, co-workers and acquaintances.

And his wife.

The wraps came off his Christmas gift, thanks to a new advertising feature called Beacon, which shares news of Facebook members' online purchases with their friends. The idea, according to the company, is to allow merchants to turn millions of Facebook users into a "word-of-mouth promotion" service.

Lane called it "Christmas ruined," and more than 50,000 other users signed a petition in recent days calling on Facebook to stop broadcasting people's transactions without their consent.

Thursday night, Facebook backed down and announced that the Beacon feature would no longer be active for any transaction unless users click "OK." Beacon is a core element of Facebook's attempt to parlay the personal and behavioral information it collects about its members into a more sophisticated advertising business, an effort to turn a user's preferences into an endorsement with commercial value.

The merging of social networking and online advertising combines two of the most powerful forces on the Internet today, and privacy advocates say it raises issues about the way personal data are disclosed for marketing purposes.

"Sites like Facebook are revolutionizing how we communicate with each other and organize around issues together in a 21st century democracy," said Adam Green, a spokesman for MoveOn.org, a liberal activist group that has launched the petition drive to pressure Facebook to stop broadcasting members' purchases and using their names as endorsements without explicit permission. "The question is: Will corporate advertisers get to write the rules of the Internet or will these new social networks protect our basic rights, like privacy?"

The site, which was started in a Harvard dorm room, has become a Silicon Valley powerhouse, recently valued at $15 billion. It allows its users to share messages, photos and updates on their lives.

Facebook launched Beacon as part of a wider social advertising campaign Nov. 6, with 44 announced partners, including Overstock, Travelocity, eBay, Fandango, Blockbuster and Zappos. The Beacon feature is not restricted to commerce. A person's high score on an online game might also be posted for friends to see.

Facebook puts a string of code called a cookie on a user's computer, which tracks the user on Beacon partner sites. In the version that Facebook launched, a person logged into Facebook who bought, say, a movie ticket, was alerted that the Web site was sending a "story" to his profile and had a chance to opt out - both at the merchant's site and on his own page, Facebook says.

But privacy advocates criticized the opt-out feature - a pop-up box - because it disappeared after a few seconds, and said Facebook should allow users to turn off Beacon and include an "opt in" feature for those who wish to receive the service. Thursday night, Facebook apparently added the "opt in" feature but still did not include a way to shut off the service permanently.

Thursday Facebook issued an apology on MoveOn's Facebook page: "We're sorry if we spoiled some of your holiday gift-giving plans."

In a news release Thursday night, Facebook said: "We appreciate feedback from all Facebook users and made some changes to Beacon in the past day. Users now have more control over stories that get published."

Marketers can target social ads on Facebook according to criteria such as age, sex, political views and taste in movies, Facebook founder and Chief Executive Officer Mark Zuckerberg told media and ad executives at the launch, according to Online Media Daily.

"What's unique about Facebook is it's really turning over personal profile data to advertisers," said Jeff Chester, executive director of the Center for Digital Democracy, a privacy advocacy group. "In essence, it's telling advertisers, we know exactly who your targets are, what their favorite entertainment is, the books they read, the kinds of social networks they have, what their political leanings are."

Beacon's risks go beyond ruining someone's Christmas, said Mike Rogers, editor and publisher of a gay-oriented Web site, PageOneQ.

"We teach young people to be very careful about what they post, and all of a sudden comes along an automated system like this. What happens if a kid is on a football team and he buys a ticket to 'Brokeback Mountain' (a gay-themed film)?" he said, alluding to the possibility that the youth could be outed and harassed as a result.

This article appeared on page A - 2 of the San Francisco Chronicle