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In the past, I was often asked why my participation on social media sites like facebook was scant to nonexistent. More recently, I hear this question less often, as the hidden costs of sites like Facebook have been uncovered in more detail by some media outlets. Several people have even deactivated their accounts outright after Facebook content caused real life problems.

You may or may not care about this topic, and as it would seem from the sheer number of registered Facebook users, most people do not. Regardless, it is my desire to raise awareness about the issues involved so that people may make better informed decisions about their use of social media technologies in general.

Simply put, TINSTAAFL. Facebook at its surface appears to be a free social media service. Yet it has hundreds of millions of users across the world, which equates to operational costs in the stratosphere. Where does Facebook's revenue come from to pay for all of these servers and bandwidth, not to mention employees, engineers and other overhead? Unsurprisingly most of it comes from advertising. Most people do not mind ad supported services, as they are rather ubiquitous in other media like TV, and is therefore a familiar tradeoff. What sets Facebook's advertisements apart however, is the fact that they are targeted based on your highly targeted personal information. And therein lies the rub.

Lured in by our desires to share and communicate with likeminded peers, Facebook users have unwillingly (or perhaps more accurately, unknowingly) divulged highly detailed personal information. This deluge of readily available personal information has unquestionably eroded the privacy of those who have participated, and in some cases caused harm in real life. While mainstream media may not cover these issues in great detail, other, more focused news sources do. One thing remains constant: Facebook sees the collection of your personal data as an opportunity to create revenue. The more information you submit, the more they stand to profit.

If there were any doubt as to Facebook's motivations, look no further than their EULA (End User License Agreement), specifically here:

You hereby grant Facebook an irrevocable, perpetual, non-exclusive, transferable, fully paid, worldwide license (with the right to sublicense) to (a) use, copy, publish, stream, store, retain, publicly perform or display, transmit, scan, reformat, modify, edit, frame, translate, excerpt, adapt, create derivative works and distribute (through multiple tiers), any User Content you (i) Post on or in connection with the Facebook Service or the promotion thereof subject only to your privacy settings or (ii) enable a user to Post, including by offering a Share Link on your website and (b) to use your name, likeness and image for any purpose, including commercial or advertising, each of (a) and (b) on or in connection with the Facebook Service or the promotion thereof.

Translation: anything you post to Facebook belongs to Facebook, to do whatever they please with, for all of time. This means your photos, your poetic ramblings, your mobile phone number, friends lists, family memberships and political views submitted to Facebook are now and forever owned solely by Facebook. You've granted them this right in your agreement to use the service. Facebook can sell your information to whomever they please, use it in targeted advertisements, give it to the authorities, and so on. Facebook is also under no legal obligation to tell you where the data goes. You granted them these rights when you agreed to use their "free" service.

While other free services like Google's Gmail also collect information from their users, they are usually less “possessive” with ownership clauses. Google's "Safe Harbor" approach to ownership not only protects Google from liability, but arguably gives the user more freedom and protection of their individual intellectual property rights.

Why does Facebook's business model leverage its user’s information in this way? There is a clear motivation in the form of a revenue stream. Most people grasp the idea that making money is an acceptable business goal. However there is also a somewhat surprising, if not subversive motivation by the creator of Facebook, Mark Zuckerberg. To him, privacy, as a concept, is dead. Zuckerberg proposes the notion that people no longer want nor deserve privacy - that we have "evolved" beyond the social norm of privacy. With so many people on Facebook posting every little detail of their personal lives seemingly without care, he appears to be right.

However I propose that privacy is not dead at all, and that people both want and need it to live happy and successful lives. While millions of Facebook users may be compromising their privacy, I contend that they are doing it unknowingly, due to the subversive nature of the Facebook business model. If more people knew what was really being done with their information, and how it could cause harm, they would not share the information they currently do. Unfortunately, we've have been persuaded by all of the compelling features of this “free social media service” - which is only really free if you ignore the hidden costs.

Let me know if you have any insight or questions about this controversial topic.

Update: Facebook has altered it’s EULA yet again. It no longer contains the word “perpetual” with regards to its ownership of content, among other changes. This may be a step in the right direction, but is too little, too late when it comes to privacy concerns.