(The Money Programme, Friday 21 December 2007; BBC TWO 7pm)
For its 57 million users, including 7.5 million in the UK, Facebook is a great way to communicate with friends and share interesting snippets and photos with them. But how many are aware that these entries are mined by marketing companies compiling customer profiles from personal information for their clients and criminals looking for sensitive information that could be used to steal identities? Facehooked, the last episode of the current Money Programme series, will investigate whether the website is the future of the internet or a bubble that is about to burst.
Facebook is transforming big business. With a value of £7.5 billion, it is the biggest recent brand launched on the internet. Its success depends on people freely posting personal information, which means the potential for advertisers to target customers is phenomenal.
Dr Gabriel Reedy from the OU Business School said: “It's brilliant that it is free to use, but because there is no subscription doesn’t mean there is no cost to users. The website needs a lot of investment in computer servers, Internet bandwidth and staff salaries. The cost to the user is that the model is based on selling targeted advertisements, and that is how users’ personal information is used.”
Facebook Ad was launched in September 2007 and provides a marketing service targeted at users’ profile and activity data. This was bad news for many users, as the site’s low advertising was part of the appeal. One user remarked: “I log on to talk to my friends, not to buy things.”
But advertisers claim that users are naïve to think there should be no advertising, as the internet is there to make money and not for altruistic reasons. And there is no turning back, as Mark Zuckerberg, founder of Facebook, confirmed at the launch of Facebook Ad: “It is an ad supported business.”
Although users can activate privacy settings so that only their nominated friends can see their personal information, only one in five members do this. It means that millions of UK members have left themselves vulnerable to potential identity fraud. To be safe, security experts advise users to be careful what they post in the first place, as Facebook accounts can only be de-activated and not actually deleted.”
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All broadcast information is correct at time of issue.
Related articles and blogs by OU Business School academics, will be available on the Open2.net website from 21 December
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