The Facebook Privacy Fallout Continues

For those just joining us, Facebook was overly aggressive with its Beacon tracking program, one of several new ad programs launched in early November. Beacon required users to opt-out or have their activity and transactions on Facebook partner sites broadcast to their networks back on Facebook. Discovering this, many people were frustrated and upset by what they felt was a lack of disclosure regarding the implications of the tracking.

Under pressure from users, the media, and privacy groups, Facebook modified Beacon’s opt-out policy on Friday, apparently making participation opt-in. But the fallout continues, with some critics not satisfied and some arguing that the company is still going too far in tracking user behavior off the site.

This report, published before the announced changes on Friday, makes the case that Facebook is tracking user behavior on third-party sites regardless of whether the user is signed in to Facebook or has opted out of Beacon.

From the New York Times blogs on Friday, Coca-Cola has reportedly opted out and said it’s not going to participate in Beacon — it had been one of the so-called “Landmark Partners” — for the time being:

“We have adopted a bit of a ‘wait and see’ as far as what we are going to do with Beacon because we are not sure how consumers are going to respond,” said Carol Kruse, Coke’s vice president of global interactive marketing, this morning. Coke had been one of Facebook’s “Landmark Partners” because it had made an especially large commitment to use the site’s new features. Other Landmark Partners included Blockbuster and Verizon.

And Silicon Alley Insider has more on Facebook “lying” to advertiser-partners about the nature of the Beacon program.

Eventually Facebook will probably create an acceptable policy around Beacon that will satisfy critics; it has faced similar uprisings and survived them in the past. The difference now is all the national media attention the company is receiving. Another question is whether consumers will cool to use of the site because of privacy fears. My guess is no, but we’ll have to see in a month or so.