On one hand, I just don't see what the big deal is. People act like Facebook is taking away all their "rights" or possessions, which is just silly. They were just clarifying how information would be used. In one sense, I feel like saying 'Chill out. And if you don't like Facebook's policies, go use some other social networking site for God's sake!'
On the other hand, I appreciate the fact that some people are far more sensitive about these things and are seeking to collectively pressure Facebook to change its approach to information use and ownership, and I'm fine with that. In fact, like the Beacon hullabaloo, it's an example of what Berin Szoka and I have argued is the power of voluntary persuasion and social pressure to remedy privacy concerns before we call on government to adopt coercive, top-down, ham-handed, one-size-fits-all regulatory solutions. As we noted in our recent paper about the looming threat of online advertising regulation:
there are many indirect pressures and reputational incentives that provide an important check on the behavior of firms and the privacy policies they craft. Just as the Internet increases the ways advertisers can reach audiences, it increases the power audiences have to influence advertisers. For example, when Facebook introduced its Beacon program in 2007, which shared users' online purchases with their friends without sufficient warning about how the program worked and the ability to opt-out of the program, the response was swift and effective: Users "collectively raised their voices" and "the privacy pendulum [swung] back into equilibrium" [according to the Interactive Advertising Bureau.] Within two weeks of the Beacon program being first deployed, Facebook had created an opt-out procedure.
Again, markets work and self-adjust to satisfy consumer preferences. Finally, I can also respect the argument that Internet companies should be expected to live up to the terms of their privacy policies since they constitute a contract of sorts with users. Thus, I would never rule out legal action against companies that play games with their privacy policies and leave the consumer clueless about their end of the deal.
But, honestly, I still don't see what people are getting so worked up about. You realize that you voluntarily joined Facebook, right? And you know you can leave at any time, right? There are plenty of other places out there where you can network with others. Indeed, the more Facebook screws up, the more likely it is others will gain a toehold in this sector. Seriously, what's stopping a mass exodus to another SNS? I dumped Facebook long ago and moved all my stuff over to LinkedIn, but they're hardly the only option out there.