Facebook has agreed to let its users turn off its controversial Beacon advertising system, the latest back-pedal from a company seeking to generate more revenues through social advertising.
Facebook CEO Mark Zuckerberg, in a contrite blog post Dec. 5, said his company missed the right balance between making the Beacon system "lightweight" enough to not disrupt users' browsing experiences while making it easy for users to control what was being shared.
The about-face comes nearly a week after Facebook changed the Beacon system from opt-out to opt-in, a change made in response to an online petition signed by more than 50,000 users who were angry that their online activities were broadcast to friends in their social network.
This is the latest egg on Facebook's proud face; the company can't seem to get privacy issues right. It's also the second such contrite statement Zuckerberg has had to make since launching Facebook. Last year, more than 700,000 people signed a petition flaming Facebook for the News Feeds section.
Is this how it's going to be from now on? What will it take for the company to recognize that it can't just trot something out that tramples peoples' privacy without testing it adequately enough?
If the company had employed some real-life focus groups, this spectacular PR mess might have been avoided. But don't be fooled.
Facebook didn't step down for the users' sake, no matter what Zuckerberg said. Facebook capitulated because partners such as Coca-Cola, Overstock.com and Bluefly.com were stepping back until the social network did something.
Somewhere, Google's privacy guru Peter Fleischer and the company's other bigwigs are enjoying a private laugh over Facebook's foibles, but in the next breath, they are already working out how they would step around such a trap.
Social ad networking, for better or worse, is quickly proving to be a trickier game than your straitlaced pay-per-click model.
With the Facebook issue becoming a major headache for that major network, you can bet rivals will avoid the danger zone by testing new ad models and listening to the feedback instead of throwing them up to see what sticks.