Facebook Retreats on Online Tracking - Via New York Times:

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 users’ 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 won’t let them.

Late yesterday the company made an important change, saying that it would not send messages about users’ 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.

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

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 users’ 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 users’ activities to their friends on the site. She says she did not see an opt-out box.

“Beacon crosses the line to being Big Brother,” she said, “It’s a very, very thin line.”

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 “based on getting into the conversations that are already happening between people,” Mr. Zuckerberg said when he introduced Beacon in New York on Nov. 6.

“Whenever 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,” said Chamath Palihapitiya, a vice president at Facebook. “After a while, they fall in love with them.”

(Read Original Article - Via New York Times.)