The company has changed the personalized settings for roughly 6 million customers who signed up for eBay between April and November of last year after a bug in its registration system was discovered.
The bug changed the default answers from "yes" to "no" to many questions on the registration page, such as "Do you want to receive calls from telemarketers?" The questions should have all been pre-answered "yes."
Customers were notified of the change and were given 14 days to change the settings before they took effect, said eBay spokesman Kevin Pursglove.
The decision was made after the company consulted several privacy watchdog groups. Pursglove said it was impossible to tell which customers changed the answers from the default settings but that "a great majority of the customers who registered this year had their settings changed."
Several eBay faithful are angry, especially because the company decided to change its policy not to send marketing materials to customers or give telemarketers personal phone numbers.
"Someone has decided to arbitrarily unselect my preference to not get called by eBay telemarketers!" Daryl Banttari, an eBay customer, wrote in an email. "I can't find the words to describe how amazed I am at the boldness of the people responsible for this."
"It's an inconvenience, and we apologize for it," he said.
But one privacy company that initially signed off on the eBay decision, Truste, is now having second thoughts.
"It appeared to us as more of a customer service issue largely because it did not deal with the transfer of information to a third party," spokesman Dave Steer said. "But after hearing reports of what's going on and talking with folks, I think there are legitimate privacy concerns."
Truste was one of several groups that eBay briefed on the details before changing people's preferences.
"eBay's a role model to other Web sites. A problem like this is new, (and) eBay has to set the right example," he said.
The move adds another dimension to the debate about whether companies should let consumers decide for themselves what they want from a company or be automatically registered and then have to "opt out."
Automatic registration, or "opting out," is what usually happens when a customer registers on eBay. The company's registration page contains a list of questions including whether the consumer wants to get eBay emails about deals. The default is usually checked "yes," and it is up to the customers to change the box to "no."
While some people will want to receive information about eBay deals, the company's decision "stretches credibility," according to Richard Smith, chief technology officer of the Privacy Foundation in Denver, Colo.
"It's not a nice thing. I don't see how it's an error that they simply chose 'no' as a default," Smith said. "If there was an error, it was the company's."
America Online made a similar move last year, Smith said. The company let customers know that their choice not to receive AOL spam had to be renewed every year, and if AOL didn't receive a reply, the customer was automatically signed up to receive unwanted email.