With So Many Business Opportunities, Why Is Facebook Dead Set On Pushing Limits Of Privacy?

Facebook appears to have crossed user privacy boundaries for the second time in under three years with their latest program, “Instant Personalization”. The service, which immediately customizes a site based on a user’s Facebook data the moment they visit the site, has drawn the attention of a number of Senators, not just users. While the debate between Facebook and public officials continues to rage on, one has to wonder: why is Facebook so intent on pushing the limits of our privacy?

The Senators Question Facebook

Yesterday we wrote about a number of Senators who had begun questioning some of Facebook’s latest actions, most importantly, demanding that Facebook make their new “instant personalization” service an opt-in one. While there’s no guarantee that Facebook will be proactive about making a change to the service, the senators are considering asking the FTC to define privacy rules that online companies must follow when managing and sharing user data.

Yesterday I had the opportunity to chat with some of the people at CNN about the new feature, which during testing, required a number of steps in order to opt-out of the new service. The “instant personalization” service is something we wouldn’t have been aware of had we not stumbled across one of Facebook’s partner sites or followed Facebook so closely.

Anti-Privacy Claims Surface

Earlier today New York Times writer Nick Bilton tweeted that a Facebook employee told him that Mark Zuckerberg does not believe in privacy. A dialogue ensued about whether or not Bilton should have posted the tweet since he told his source it was “off the record”. Considering Facebook’s history of providing granular privacy tools, it seems somewhat out of character for Mark Zuckerberg to ever state that he “doesn’t believe in privacy”.

While Zuckerberg has suggested that there is an ongoing trend toward openness, the company has attempted to enable users to control what information is public and what is private. While there is still some question about how much users are aware of what is being shared about them, it’s pretty clear that Facebook wants to do good for the most part. However on occasion, the company crosses an invisible line.

Why Must They Test The Limits Of Privacy?

The first time Facebook crossed the line was when they launched Beacon, back in November of 2007. The service enabled Facebook users’ activity to be tracked around the web. Stories would then be published about that activity after the user took some type of action on the site they were visiting. The service was eventually shut down following a massive community backlash and countless lawsuits, one of which which eventually resulted in a pretty large, $9.5 million settlement.

At the time, the greatest point of contention was that the service was opt-out, not opt-in. However, years later, Facebook has tried to force users to accept another opt-out service. Did the company not learn their lesson the first time around? And more importantly, why on earth does Facebook continue to test the limits of privacy?

I Would Have Opted In

As I previously mentioned, Facebook Beacon was not a bad idea, the only problem was how it was implemented. Had the service been opt-in, I would have used it, yet Facebook probably thinks that most users wouldn’t have. The latest service, “Instant Personalization”, has some great features. As I explained to the CNN correspondent yesterday, I actually like the new “Instant Personalization”, as I enjoy seeing what my friends have been up to on other sites.

The only problem with it, is that Facebook forced it upon all users. If the users like the service, there’s no doubt that other people will begin to opt-in to the service as they share the feature with their friends. Unfortunately though, Facebook has crossed the line once again and is now forcing users to opt-out.

Privacy And Innovation Can Go Together

One of the fundamental philosophies that appears to be spreading around the internet startup world is that innovation and privacy are not complimentary. Twitter, for example, let’s you publish any information you want to the public. While the service has a private option, most users make their information totally public on Twitter. Blippy, a service that has faced increasing scrutiny over the past week, lets users publish information about every purchase they’re making.

Foursquare, one of the most buzzed about startups right now, let’s you post your location for all to see. Does this mean that this is the way the world is going? Or does it simply mean this is the way that internet startups have chosen to “innovate”? I’d argue that it’s the latter and ultimately, Facebook will win when users have complete control of all their information.

While sharing information has become an integral component of our daily communication, who we share that information with differs from person to person. With close to 450 million users, Facebook has plenty of opportunities to make money while simultaneously releasing new innovative technologies. None of this need to violate users’ privacy.

Despite this, Facebook continues to release products that violate the users’ trust and ultimately, that’s going to be more damaging to the company than anything else. Rather than publicly debate the issue with the Senators and the general public, Facebook should spend their time innovating in areas that don’t intend to abuse users’ privacy. While the “instant personalization” service may have been launched with good intentions, it’s only damaging Facebook’s reputation at this point.

Do you see any benefit to Facebook’s continued test of user privacy limits? Do you support Facebook’s opt-out services?