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More bad news for Facebook

The bad news continues to mount for Facebook as the company admits that the Beacon ad service tracks logged-off users, in contradiction to prior statements by company executives.

The bad news about Facebook's Beacon program, user tracking, and privacy concernsjust keeps piling up. Now Mark Zuckerberg and Facebook are under fire from consumers, journalists, activist and advocacy groups, and even its own advertising partners.

Today's biggest revelation, reported by PC World, is that "Facebook has confirmed findings of a CA security researcher [Stefan Berteau] that the social-networking site's Beacon ad service is more intrusive and stealthy than previously acknowledged, an admission that contradicts statements made previously by Facebook executives and representatives," including email correspondence between Berteau and Facebook's privacy department, as well as statements made by Facebook vice president Chamath Palihapitiya to The New York Times.

Facebook confirmed Stefan Berteau's specific allegation that Beacon tracks the off-Facebook activties of members even when they are logged out of the social-networking site.

The big question for users is whether there is anything Facebook can do to regain their trust. One of my frustrations with this story has been to see many media reports with headlines like "Facebook in privacy U-turn over Beacon" when the company had still refused to allow users to easily and permanently opt-out of Beacon.

Now as more revelations and discrepancies come to light, we're seeing more coverage like today's San Jose Mercury News editorial, "Facebook move doesn't clear up privacy fears."

The privacy groups EPIC and the Center for Digital Democracy are preparing to file FTC complaints against Facebook. In the meantime, advertisers including and Coca-Cola have dropped their connection with Beacon. As Henry Blodget observed in the Silicon Alley Insider blog, "Ouch. You can dismiss whiny 'pundits' all you want, but when major advertisers you touted as being charter members of the program decide you jerked them around, you had better start apologizing in a hurry."

I wish that consumer pressure were enough to turn this program around (or off!) but advertisers and regulatory agencies may be the ones to ultimately get Facebook's attention.