Good-Bye to Privacy?

New Yorker Barry Hoggard draws a line in the sand when it comes to online privacy. In May he said farewell to 1251 Facebook friends by deleting his account of four years to protest what he calls the social network's eroding privacy policies.

"I'm sick of keeping track of my Facebook privacy settings and what boxes I have to check to protect myself," says Hoggard, a computer programmer. "I don't have a lot of illusions about online privacy, but Facebook has gone too far," he says of Facebook's recent privacy policy changes.

From Facebook to advertisers who may be putting your online identity up for sale to the highest bidder, and to strangers who could track you across town, new ways of using technology and the Internet are making privacy issues a flash point for controversy.

"Privacy today isn't what it was a year ago," says Jeffrey Chester, director of the Center for Digital Democracy, a nonprofit group that promotes online privacy and free speech. "It wasn't long ago we were worried about advertisers planting cookies on our PC," he says. With today's trends, keeping a handle on your privacy is going to become even harder a year from now, he adds.

What follows are several emerging privacy threats.

Social Networks

Do social networks herald the end of privacy? Lots of former Facebook users who recently ditched their accounts in protest think so. With 450 million users, many say, Facebook is a bellwether for other social networks on user privacy.

Swapping small talk and vacation photos made Facebook addictive for users. But over the years, they've watched as their private info became shared with a growing sphere of strangers--advertisers. And in May, Facebook made changes to its privacy policy that exposed more personal data to a wider range of marketers.

One change involved the Instant Personalization pilot program, which let selected Facebook partner Websites access your data and tailor content to your tastes. With Instant Personalization activated, your Facebook information can be accessed the moment you arrive on partner sites including Microsoft's Docs.com, Pandora, and Yelp. When the program launched in April, Facebook automatically activated it for all users. However, a privacy uproar forced the company to revise its policy. Instant Personalization is now optional for users.

Facebook has suffered privacy backlashes before. In 2007 it introduced Beacon, an ad system that tracked certain actions of Facebook users on 44 partner sites so as to report those actions back to users' Facebook friends network. But many users revolted, citing privacy concerns. Facebook CEO Mark Zuckerberg quickly apologized and made Beacon an optional feature.

"Facebook is literally turning down the Facebook privacy settings for its users," says Electronic Privacy Information Center director Marc Rotenberg. In early May, EPIC and 14 other consumer groups filed a complaint against Facebook with the Federal Trade Commission. The complaint accuses the site of following unfair and deceptive business practices, in part, for disclosing previously private details to the public.

Google Buzz (the search giant's social network) has also endured privacy issues. Buzz exposed a list of users' most frequently accessed e-mail contacts when it launched earlier this year.

Social networks have forced users to rethink what privacy is in a world where public sharing of private lives has become commonplace, observes Jeremy Mishkin, an attorney specializing in privacy law. "The real issue is how best to assure individuals they have control of their own information," Mishkin says.

Facebook declined interviews, but issued a statement: "It's important that Facebook and other sites provide [users] with clear control over what information they want to share, when they want to share it, and with whom. We're listening to feedback and evaluating the best way to respond to concerns."

Note: We have tips to help you negotiate the maze of Facebook's privacy settings.

Data Harvesting

Creating a digital profile on you gets a lot easier if you are on Facebook or Google Buzz and hanging a shingle on LinkedIn. That marketers use your interest in, say, Volkswagen cars to target-market you a new Jetta may be no surprise. But will your Facebook status ever be used by a credit agency, health care provider, or future employer to determine if you are a good bet?

Firms such as California-based Rapleaf say they are working with financial institutions to run their databases of e-mail addresses to assemble customer profiles based on information shared on social networks. Rapleaf's vice president of business development, Joel Jewitt, says it collaborates with company marketing departments, not credit-approval departments, to better target financial services to banking customers.

Rapleaf is merely one of many firms--ranging from Acxiom to Unbound Technology--that tap into social networks to marry your profiles, tweets, and LinkedIn information with your e-mail address. If a company wants to know more about you, it can just hire one of these outfits.

The firms bristle at the notion that your credit card interest rates could be jacked up based on a tweet that you just got laid off. But privacy experts say that this may be a reality in coming years (see related story: "Can Your Online Life Ruin Your Credit?").

To privacy activists, online advertisers have always been too smart for their own good. Now two emerging trends in advertising have privacy groups once more complaining that Madison Avenue has gone too far.