The Facebook betrayal - users revolt over advertising sell-out

Networking site to put members' mugshots on ads

It used to be a great way to swap student party drinking stories. Office workers embraced it as a chance for a quick escape from the daily drudgery – until their bosses banned it. And 50-something parents marvelled at a virtual window on what their children were up to. That is the appeal of Facebook, which in little more than a year has exploded from an elite student-only club into a global social networking phenomenon with more than 54 million users.

But with Facebook's latest attempt to turn those users into dollars, the site that was started in 2004 as a way for one Harvard student, Mark Zuckerberg, to stay in touch with his classmates has grown up faster than a child who has just found out the truth about Father Christmas. Like that kid on Christmas Eve, the innocence of Facebook's users, including almost 11 million in the UK, has been shattered by the site's decision to fall into the clutches of the corporate world.

First Facebook, which is run by the 23-year-old Mr Zuckerberg, sold Microsoft a 1.6 per cent stake for $240m (valuing the site at a staggering $15bn) and then it announced plans to plaster users' mugshots on advertisements for products that they like. Its new strategy, dubbed "social advertising", is a twist on word-of-mouth marketing and will turn its users into cyber ambassadors for commercial brands, often unwittingly. Unwittingly, because all most Facebook

users know about the site's plans came via a brief blog posting when they logged on 11 days ago.

The new technology will also allow businesses to build custom-designed "pages" on the social networking site. Users can become "fans" of a company's page, which means any interaction with that brand will be broadcast to their Facebook friends.

Privacy campaigners are up in arms about Facebook's move, lambasting the company for selling out its users to the highest bidders – companies such as Coca-Cola, Sony, Verizon and Blockbuster.

Jeff Chester, executive director of the Centre for Digital Democracy in Washington, warned yesterday that Facebook has mounted a "massive invasion of user privacy". He added: "The authorities need to crack down on Facebook and MySpace to stop data collection and make sure people's privacy is respected." He wants regulators, including the European Commission's Privacy Authority, to investigate.

Deborah Pierce, who heads the lobby group Privacy Activism, said: "Users should be concerned. They have no idea who has access to information about them from the site."

In the US, legal experts, such as the University of Minnesota law professor William McGeveran, have queried whether Facebook's ad strategy is even legal. He believes that under a 100-year-old New York privacy law users may be able to sue for damages if their photos are used for advertising purposes without their consent. (Facebook's privacy officer, Chris Kelly, begged to differ.)

Mr Zuckerberg, who dropped out of Harvard to expand the site, has few doubts. "The next 100 years are going to be different for advertisers, starting from today. For the past 100 years, media has been pushed to people, but now marketers are going to be a part of the conversation," he said.

It is early days, but so far Facebook's online community is not impressed at being sold out. Discussion groups have sprung up attacking the new ad strategy. One, "My photos are MINE! NOT Facebook's! Change the Terms and Conditions", has almost 35,000 members, while around 12,000 people have signed up to "Facebook: Do not sell my private pictures! Change your terms of use, NOW!"

Contrast that with the feeble 600 so-called "fans" that Coke has on its Facebook page. And Blockbuster, that US movie lending giant, has a whopping two "fans".

Web 2.0 observers warn that the Great Facebook Betrayal could backfire. Nichols Carr, a prominent technology author, wrote on his blog: "In breaking the illusion [that people's activities are not being monitored] Facebook is taking a big risk. It may set off a rebellion among its users, who up until now have felt comfortable cavorting behind Facebook's walls."

Facebook is not alone in battling to make money out of virtual communities. Rupert Murdoch's MySpace is among 30-plus social networks to back a Google-led alliance working on its own ad strategy.

Even a Facebook spokesman admits that users will have to opt out of being used as cyber ambassadors for companies "on a per-site basis". And just one-quarter of Facebook's users takes advantage of its privacy features.

Arguably most of them neither know nor care that they are being exploited. An entire generation, which thinks nothing of posting personal information online, is sleepwalking its way into a Big Brother state where ID card debates will be yesterday's news.

For those who do mind, however, the changes afoot in the world's top cyber communities – the blatant commercialism, the selling out and the cosying up to big brands – could prove to be the straw that broke the camel's back. New research out from Henley Centre Highlight Vision, one of WPP's strategic consultancies, shows a backlash against the likes of Facebook is already under way in favour of what's being called "Analogue Living". Could it be bye-bye Facebook and hello face-to-face socialising?