Facebook Retreats on Privacy

Facebook is close to a settlement with the U.S. government over charges that it misled users about its use of their personal information, the latest sign of widening public concern over privacy in the digital age.

According to people familiar with the talks, the settlement would require Facebook to obtain users' consent before making "material retroactive changes" to its privacy policies. That means that Facebook must get consent to share data in a way that is different from how the user originally agreed the data could be used. The pact—which awaits only final approval from the Federal Trade Commission—has the potential to reverberate widely. Myriad online services and companies are developing sophisticated tools for observing people's behavior online and profiting from the personal information they provide. In recent months, the FTC has been signaling that privacy is on the top of its enforcement agenda. The settlement stems from changes Facebook made to its privacy settings in December 2009 to make aspects of users' profiles—such as name, picture, city, gender, and friends list—public by default. At the time, Facebook founder Mark Zuckerberg described the changes as a "simpler model for privacy control." Users complained and several privacy advocates, led by the Electronic Privacy Information Center, filed a complaint with the FTC, alleging the changes were unfair and deceptive. Under the terms being discussed, the agreement would require Facebook to submit to independent privacy audits for 20 years