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Facebook Scales Back Ads Amid Privacy Concerns

Posted on 11.29.2007
Facebook's latest advertising system raised many eyebrows and concerns when it was announced several weeks ago. Previoiusly, Facebook was seen as a haven for safe, fairly private social networking and preferred by many to the non-secure and spam-filled MySpace network. That changed when Facebook's advertising program, Beacon, began sharing what many considered private information in order to make some bucks on advertising. This mostly concerned the way that many websites tracked a Facebook users' shopping or website visitation habits and then alerted their friends where they had been and what they had bought. A petition circulated Facebook to make some changes - some 50,000 users signed it (in just 9 days) and now the social networking juggernaut is responding to user fears. This is mostly taking shape in the form of explicit opt-in procedures that users must complete in order for their information to be passed along, rather than the opt-out procedure that existed before. This will no doubt dampen the enthusiasm of advertisers and Facebook executives, as opt-in programs traditionally see significantly less particapation. It's a pretty big stumble for Facebook - the company is probably feeling significant pressure to make good on value projections of $15 billion based on Microsoft's 1.6 percent stake which they purchased for a cool $240 million not long ago.

In the wake of the uprising at Facebook and the revelation that information passed along spoiled some users' gifting plans, Paul Janzer released this statement, "We're sorry if we spoiled some of your holiday gift-giving plans. We are really trying to provide you with new meaningful ways, like Beacon, to help you connect and share information with your friends." It's unclear if Janzen is now referring to advertisers as "friends."
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