Home Facebook: Have Data, Will Travel? Rumored Ad Product for Third-Party Sites

Facebook: Have Data, Will Travel? Rumored Ad Product for Third-Party Sites

According to Lee Lorenzen, of Altura Ventures, and AllFacebook, the “Social Ads” advertising service Facebook is supposedly set to launch next week will take Facebook ads outside the social network.

The rumored technology would work like this: Facebook would place a cookie on your computer (the site already requires users to have cookies enabled to log in), every time you visit a third-party site that runs ads utilizing the “Social Ads” product, they would be targeted based on your social networking profile data. So, theoretically, if you’ve professed your love of Pepsi on your Facebook profile, you might see Pepsi ads while reading the news at MSN.

Ad networks like DoubleClick and aQuantive already use cookies to track user behavior, that could theoretically be used to build a profile of which sites you visit. That ability does not necessarily sit well with privacy advocates who are concerned that these companies have too much information about users. What Facebook is reportedly planning to unveil would go beyond tracking your web browsing behavior and building a profile on what you like based on the sites you visit, however. Instead Facebook would use explicit data about your interests to target ads across the web.

Would users be comfortable with the idea of their profile data following them around outside of Facebook in the form of potentially very personally targeted advertising? Though, in reality, it is probably not that different from using your data to deliver ads on Facebook (the data is available to advertisers either way), it may just feel creepy to users to have the information about their lives that they had thought they were sharing privately with friends being used to target advertising directly to them across the web.

If this does fly, it could be a big win for Microsoft, whose $240 million investment in Facebook is thought by many to be more about acquiring a stronger advertising relationship with the site than acquiring a stake in the company. A combination of Facebook’s immense, untapped user data set and Microsoft’s ad sales team could mean significantly higher CPMs for sites using Microsoft’s ad networks and higher revenue for Facebook and Microsoft.

What do you think? Is this a good idea for Facebook or will it just draw the ire of users? Would you continue you use a site that you knew was using your personal information to target ads to you on other web sites? Is Facebook’s rumored proposal crossing the line in terms of privacy?

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