All Things Digital

For those who missed it, here is the entire video of the piece CBS’ “60 Minutes” aired on Facebook last night, helmed by veteran correspondent Lesley Stahl.

It is not exactly the big wet kiss I was expecting the hot social-networking company would get, but it was also definitely not an ouch-that-hurts piece that could have been done.

For those who don’t know the tale, it hits all the high (and low) points of the Facebook saga, with a button-pushing efficiency that television does so well. Thus, a synopsis:

Web Wunderkind Mark Zuckerberg, who seems genetically unable to smile (unlike, say, his deeply charming sister). Harvard. Ratty hoodies and flip-flops. Mark makes a Facebook profile for Lesley (how much do we love that she blocked her boss Les Moonves?).

Next stop: Silicon Valley! Dropping out and venture funding. Toddler CEO (that one was coined by BoomTown). Crazy HQ with kooky-looking employees, one of whom you know was forced to ride a unicycle through the office by Lesley.

Big growth. Is Mark Google’s Larry and Sergey rolled into one? Inexplicably, ZERO mention of its bigger rival, MySpace, even once. Worth $15 billion?–an insane number Lesley does not question nearly enough.

Oops, Privacy! Oops, Beacon! BoomTown tsks tsks that stalkerish advertising idiocy and is asked about Mark’s qualifications as CEO (although no one cares what BoomTown thinks). Mark retorts: Hey, we need to make money. Lesley, so give the Wunderkind a break!

But here is the entire segment for your viewing enjoyment:

CBS’s “60 Minutes” will air its Facebook piece on Sunday, and BoomTown is curious to see what take the iconic new magazine show will have on the hot and hyped social network and its founder, Mark Zuckerberg.

In clips it has released, Zuckerberg tells veteran correspondent Lesley Stahl that its stalkerish ad product Beacon–a half-baked ad scheme Facebook cooked up that sends information about your purchases on partner Web sites back to your profile on the service–needs work.

Really? I had no idea! Oh, wait, I did.

Zuckerberg goes on to assure Stahl and the viewing public that Beacon will be a good tool someday. “It might take some work for us to get this exactly right,” said Zuckerberg in the interview. “This is something we think is going to be a really good thing.”

Since the 23-year-old is no Martha Stewart, we would like to take his word for it, but will not for now.

Zuckerberg also tells Stahl not to expect an IPO in 2008–well, I was not expecting one, but thanks for the confirmation–meaning that Facebook would have to make do with the $300 million it recently got from Microsoft and Chinese rich man Li Ka-shing for small stakes in the company.

The investments, as faithful BoomTown readers know, gave Facebook an insane $15 billion valuation. Despite the start-up’s fast growth and impressive record of building a pretty good service, I hope Stahl gives that wacky number her patented dubious eyebrow raise she always throws at various and sundry midrange dictators talking democracy.

We’re also interested in seeing the piece for you’re-so-vain reasons, because I was also interviewed by Stahl for the segment.

No surprise, Stahl asked if I was biased because of my partner, the Google exec (see my voluminous disclosure about that and more here), and because Rupert Murdoch now owned both Facebook rival MySpace and Dow Jones (owner of this site).

Well, no to both, since I was slapping around Facebook long before Google declared Open Social war on it and also before News Corp. was our corporate pooh-bah (also, the idea of me doing Rupe’s social-networking dirty work is laughable).

But most of the interview was about the many challenging issues I and others have raised about Facebook. In her lean-forward style, Stahl asked me a range of questions, mostly having to do with my many pieces on the start-up and Zuckerberg.

An old pro at the shake-up game, she noted at the start that some had called me “nasty” and “mean” for my sharpish reporting on Facebook.

I confess! I confess! It’s all true!

That is, if by mean, Stahl meant my thinking the valuation was undeserved thus far, raising questions about the need for a magic business plan to support that valuation and, of course, my wondering if Zuckerberg was experienced enough to be Facebook’s CEO.

Then, of course you can call me Cruella De Poke.

How I wish CBS–paging Quincy Smith!–would allow embedding of its videos, but here is a link to one clip from the interview where Zuckerberg talks about Beacon. And here is another about Zuckerberg’s wacky days as a hacker at Harvard.

The show airs at 7 p.m.

It is easy to make light of the constant swirl of twittery online activity that surrounds well-known blogger Robert Scoble.

But Facebook’s disabling of his account yesterday–because he was apparently using a script to access and pull data from his own profile there to move it to other social graphs of his choice–is not going to turn out well for the social-networking company.

In fact, it seems to me that the company is about to shoot itself in the foot once again. And–let’s be honest–Facebook certainly doesn’t have any bullet-free feet to aim at after its recent debacles with its stalkerish Beacon ad product and its ill-advised legal action against a magazine that published embarrassing information about Founder and CEO Mark Zuckerberg.

As goofy as it seems, it looks like Scoble has aimed perfectly at the Achilles’ heel of Facebook–the testy issue of data portability and how much control you should have over your own information online.

In this case, as Scoble wrote in a blog post today, the fight with Facebook is over an effort he has been making with DataPortability.org, which notes on its Web site that “our identity, photos, videos and other forms of personal data should be discoverable by, and shared between, our chosen tools or vendors.”

Such activity–which Facebook characterizes as “scraping”–is not allowed under its Terms of Use.

More to the point, such an ability would be damaging to Facebook’s business plan around building a robust ad business. The success of that squarely relies on people staying and actively using the service because they have committed time and effort in putting up scads of information, photos and videos about themselves on the service, as well as establishing a complex and personally valuable network of friends.

For example, Scoble has said he has about 5,000 friends on Facebook alone–the upper limit on the service.

That’s some digital Rolodex you don’t want to lose, and Facebook knows this.

Thus, it has zero interest in allowing people to escape easily if they want to, even though THE INFORMATION ON FACEBOOK IS THEIRS AND NOT FACEBOOK’S.

Sorry for the caps, but I wanted to be as clear as I could: All that information on Facebook is Robert Scoble’s. So, he should–even if he agreed to give away his rights to move it to use the service in the first place (he had no other choice if he wanted to join)–be allowed to move it wherever he wants.

Still, in an email to him, Facebook customer service wrote: “Our systems indicate that you’ve been highly active on Facebook lately and viewing pages at a quick enough rate that we suspect you may be running an automated script. This kind of activity would be a violation of our Terms of Use and potentially of federal and state laws.

“As a result, your account has been disabled. Please reply to this email with a description of your recent activity on Facebook. In addition, please confirm with us that in the future you will not scrape or otherwise attempt to obtain in any manner information from our Web site except as permitted by our Terms of Use, and that you will immediately delete and not use in any manner any such information you may have previously obtained.”

Scary! Of course, because it is Facebook, there is already a group formed to urge he be reinstated.

In other words, Facebook is about to get Scobleized and it is not going to be pretty.

Just because it is the holiday season and BoomTown is feeling all holly and jolly and merry, it doesn’t mean we’re going to back down on the fiasco that was, is and will always be Facebook’s Beacon.

In fact, we’re hopping mad all over again after a talk we had last week with a very smart exec at a company that Facebook does a lot of business with, who posited the right way the social-networking phenomenon could have rolled out the now radioactive ad system.

It did not have to be that way, as the exec I was talking to noted, if Facebook had first launched the Beacon service–which can track your purchases on some external sites and send the information back to your Facebook profile’s news feed–as a noncommercial tool for users, focusing on things they had posted on a range of external Web sites that they actually might like being broadcast back to friends at Facebook.

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Yesterday, Facebook Founder and CEO Mark Zuckerberg posted a major mea culpa blog post about the controversy around its Beacon ad product, which can track your purchases on some external sites and send the information back to your profile’s news feed.

As usual, BoomTown asked for the obligatory on-the-record interview with Zuckerberg (pictured above), but he still has not invited us over to get social at his social-networking HQ in Palo Alto, Calif. So while we’re waiting by the phone, we need to get busy.

Thus, we continue our thankless quest to decode all memos from Internet moguls (BoomTown speaks fluent Web 2.0 double talk).

(In October, we did this for Randy Falco’s memo about the AOL layoffs. And, back in late August, we also translated a memo from Yahoo President Sue Decker about its reorganization of management.)

So here’s my take on Mark’s take:

Mark wrote: Thoughts on Beacon

Translation: Facebook PR head Brandee Barker’s thoughts on Beacon, so Valleywag’s Owen Thomas will stop pestering her.

Mark wrote: About a month ago, we released a new feature called Beacon to try to help people share information with their friends about things they do on the Web. We’ve made a lot of mistakes building this feature, but we’ve made even more with how we’ve handled them. We simply did a bad job with this release, and I apologize for it. While I am disappointed with our mistakes, we appreciate all the feedback we have received from our users. I’d like to discuss what we have learned and how we have improved Beacon.

Translation: I thought I was the CEO…b#*t#*, as my business card used to read, but it turns out maybe not so much. I would surely like to zombie-bite those annoying reporters, the whiny privacy advocates and those cut-and-run advertisers, who obviously don’t understand my $15 billion worth of genius. I wonder if I could find a way to blame the Winklevosses, who have the audacity to sue me for stealing their original social networking idea at Harvard!

Mark wrote: When we first thought of Beacon, our goal was to build a simple product to let people share information across sites with their friends. It had to be lightweight so it wouldn’t get in people’s way as they browsed the Web, but also clear enough so people would be able to easily control what they shared. We were excited about Beacon because we believe a lot of information people want to share isn’t on Facebook, and if we found the right balance, Beacon would give people an easy and controlled way to share more of that information with their friends.

Translation: When we first thought of Beacon, we thought it would make bank to backfill that kooky valuation, so Steve Ballmer would stop texting me “Where’s the beef, dude?” hourly. By lightweight, we meant we were actually thinking of a sneaky way of tricking users into becoming digital billboards without realizing it. By easy and controlled, we meant an easy way to control their brains into thinking this was a good thing.

Mark wrote: But we missed the right balance. At first we tried to make it very lightweight so people wouldn’t have to touch it for it to work. The problem with our initial approach of making it an opt-out system instead of opt-in was that if someone forgot to decline to share something, Beacon still went ahead and shared it with their friends. It took us too long after people started contacting us to change the product so that users had to explicitly approve what they wanted to share. Instead of acting quickly, we took too long to decide on the right solution. I’m not proud of the way we’ve handled this situation and I know we can do better.

Translation: But we lost our balance sitting on the big pile of money we got from Microsoft and that richer-than-rich Asian billionaire. To repeat: Lightweight=sneaky. Since most of our users are too busy popping each others zits or sending digital teddy bears or being cartoonified, we were shocked that they were actually paying attention to our efforts to milk their interests in, say, mountain biking or spelunking, as if they were cows and we were Old MacDonald. E-I-E-I-Oops.

Mark wrote: Facebook has succeeded so far in part because it gives people control over what and how they share information. This is what makes Facebook a good utility, and in order to be a good feature, Beacon also needs to do the same. People need to be able to explicitly choose what they share, and they need to be able to turn Beacon off completely if they don’t want to use it.

Translation: Facebook has succeeded so far, in part because people are simultaneously natural stalkers and shameless exhibitionists. So we thought they’d jump at the chance to tell all their friends they had bought, say, a year’s supply of Viagra or downloaded songs from Air Supply or ordered several pairs of Spanx.

Mark wrote: This has been the philosophy behind our recent changes. Last week we changed Beacon to be an opt-in system, and today we’re releasing a privacy control to turn off Beacon completely. You can find it here. If you select that you don’t want to share some Beacon actions or if you turn off Beacon, then Facebook won’t store those actions even when partners send them to Facebook.

Translation: Philosophy? All those Harvard philosophy majors now work for me in customer service. Opt-in, opt-out. If we say it fast over and over again, users will hopefully get really dazed and confused and just lay down and accept their ultimate fate as target practice for marketers. More to the point, I just said we will still receive information on all your purchases and I hope you did not notice that. Opt-in-opt-out-opt-in-opt-out-opt-in-opt-out. Are you getting sleepy yet?

Mark wrote: On behalf of everyone working at Facebook, I want to thank you for your feedback on Beacon over the past several weeks and hope that this new privacy control addresses any remaining issues we’ve heard about from you.

Translation: And we have made it extra special confusing to change your Beacon settings, because of all the whining from you teeny brains, which is really annoying to us big brains here at Facebook. To get back at you, we’re hard at work thinking up all sorts of new privacy violations you’ll never be able to understand!

Mark wrote: Thanks for taking the time to read this.

Translation: You may return to your regularly scheduled SuperPoking.

Mark wrote: Mark

Translation: Beacon fiasco aside, I’m still the CEO b#*#*, no matter how many times Swisher mocks my flip-flops.

So, Mark Zuckerberg apologized.

Yes, he took too long to do it. Yes, he was dumb to release a product, Beacon, without thinking through the potential privacy implications. Yes, it was a big black eye for the Facebook founder.

But good for him.

While some are arguing that no one but the press and privacy advocates cared about the whole controversy around the ad system that can track your purchases on some external sites and send the information back to your Facebook profile’s news feed, it was only bound to get uglier out there.

So Zuckerberg, as he had before on news feeds, correctly calculated that it was time to eat crow. “I’m not proud of the way we’ve handled this situation and I know we can do better,” he wrote in a blog post today on the topic.

We knew that was coming, didn’t we?

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As inevitable as air, Silicon Valley likes to build them up and then tear them down.

Thus, the bell now tolls for Facebook Founder Mark Zuckerberg.

We at BoomTown have been consistent and persistent in voicing our various worries about the young entrepreneur, from one of our very first posts, questioning (we think fairly) the unproven business underpinnings of the hot social network, the juvenile nature of its much vaunted third-party widgets, the insanity of its $15 billion valuation, its inane legal fights and the problems with its worrisome ad efforts.

We’ve also taken (we think probably unfairly) shots at those flip-flops he wears. And we did call him a toddler CEO, also a low blow, we have to admit.

But now, it seems, a mob is forming, sparked by the issues around Facebook’s controversial Beacon ad program, which can track your purchases on some external sites and send the information back to your Facebook profile’s news feed.

While it made some changes in Beacon last week, Facebook has not given users a global opt-out of the controversial marketing system in which the social network is seeking to link behavior and advertising more tightly for supposedly bigger payoffs.

The mainstream media and blogosphere, which recently were feting him, have now turned and ire has been growing over Beacon, which seems to be focusing everyone on the inexperience of Zuckerberg and the challenges facing Facebook.

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It should come as no surprise, of course, given it was essentially a legal temper tantrum on the part of Facebook founder Mark Zuckerberg.

But a judge in Massachusetts wisely denied an inane request by the Palo Alto, Calif.-based social-networking start-up to take down confidential court documents that 02138 magazine had made available for downloading on its Web site.

The documents were part of a hard-hitting piece called “Poking Facebook” by free-lancer Luke O’Brien, which 02138 recently published, about the origins of Facebook at Harvard University.

“This is a victory not only for 02138, but for the First Amendment as well. We felt we had an important responsibility to report the story and we hope that we were able to promote greater public understanding of the origins of a powerful and influential Web site,” said 02138 President and Founder Bom Kim in a statement. “The judge concluded that the article was an example of ‘core journalism’ and that the original documents on 02138mag.com increased transparency, offering readers unfiltered access to more information on which to evaluate the story.”

Facebook had no comment.

But how could its execs, really, given the appalling nature of their efforts to quash documents that should not have been, especially because they were already loose on the Web?

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[UPDATED with more information.]

So exactly why did Facebook unleash such a massive legal fury on 02138 magazine yesterday over documents the publication posted online?

Because, said sources, those documents–including an application to Harvard University–contained Facebook founder Mark Zuckerberg’s Social Security number, the full name of his girlfriend and the address of his parent’s house in New York.

Now, apparently, the Beacon’s on the other foot.

The independent magazine, which is aimed at Harvard alumni, put up a series of court documents in a downloadable format here it obtained from a court in Massachusetts related to a hard-hitting story it recently published about the origins of Facebook at Harvard, and had inadvertently not redacted that sensitive personal information in all places at first.

It has since removed those references, but many online readers had already downloaded the PDF files.

“It was a regrettable error and we have fixed it,” said Richard Bradley, executive editor of the magazine.

Wrote the magazine’s spokesperson in a statement to BoomTown: “1) It was an oversight and as soon as 02138 was alerted they took it down. 2) The parents’ address is listed in the white pages and they are the only Zuckerbergs in Dobbs Ferry. 02138 nonetheless took it down as a courtesy. 3) This was not brought to 02138’s attention by Facebook.”

Harsh!

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