Facebook Settling Beacon Mistake For $9.5 Million

Posted Sep 21, 2009

When Facebook launched Beacon in 2007, there was a lot of controversy. There were a good number of class action privacy lawsuits. This lead to the recent shutting down of Beacon. The settlement cost Facebook quite a bit of money too. Facebook plans to donate $9.5 million to an organization that advocates online privacy.

Facebook Director of Policy Communications Barry Schnitt said that the situation around Beacon “underscored how critical it is to provide extensive user control over how information is shared.”

“We look forward to the creation of the foundation and its work to educate Internet users on how best to control their privacy; engage in safe social networking practices; and, generally, enjoy themselves more online by having knowledge that gives them a greater sense of control,” added Schnitt.

Facebook Beacon started in November 2007 as a marketing campaign for advertisers. Beacon would find out what types of items and services you are buying on e-commerce websites and report it to the Facebook homepage. The service was opt-out rather than opt-in which made it even more controversial. Mark Zuckerberg personally wrote an apology letter to the users in order to calm the mob. But it was too late. Now Facebook is really paying for it.