Facebook beats a hasty retreat

On February 4, (the day after its 5th birthday) Facebook stirred up a hornet's nest of opposition with a new policy that members interpreted as “what’s mine is mine and what’s yours is mine.” The controversy even made the local TV Monday night.

Much of the controversy was over what happened to your content if you decided to delete your account (e.g. if you realize you’ve shared too much information and you want to disappear from the scene). An oft-linked summary of the issues is found on the Consumerist.

Because the Web 2.0 is a viral networking site, its members angry with its new policy have been blogging, linking each other, and even forming Facebook groups to oppose the change. More seriously a self-appointed privacy watchdog was filing a complaint with the FTC to force Facebook to revert its privacy policy to its old version.

On Monday, founder Mark Zuckerberg tried to calm the waters with a posting to his blog claiming the change was no big deal. Apparently that didn’t work.

However, Facebook users who logged in last night saw this announcement:

Terms of Use Update
Over the past few days, we have received a lot of feedback about the new terms we posted two weeks ago. Because of this response, we have decided to return to our previous Terms of Use while we resolve the issues that people have raised.

(I haven’t been using Facebook much, but I’m heading a social networking task force for our local MIT alumni club, so I happened to be checking things out last night).

This morning, the website says

Terms of Use Update
Over the past few days, we have received a lot of feedback about the new terms we posted two weeks ago. Because of this response, we have decided to return to our previous Terms of Use while we resolve the issues that people have raised. For more information, visit the Facebook Blog.

If you want to share your thoughts on what should be in the new terms, check out our group Facebook Bill of Rights and Responsibilities.

On Tuesday night, Zuckerberg posted to his blog at 10:17pm (EST?) announcing the retreat.

Customer relations for any company with 175 million customers is going to be tricky. However, it appears that Facebook has less ability (or willingness) to impose unilateral privacy changes than (say) eBay has to impose unilateral price increases.

I’m not exactly sure why. Is it because it has competitors? Is it because the site has no purpose other than to engender a sense of belonging (which requires trust)? Is it because it provides the tools for its members to organize opposition?

It could also be that the young, hip Facebooksters listen better than do the eBay types, or that in this case, they care less about having their way than eBay does about increasing income.