In an out-of-court settlement, Facebook has agreed to shutdown Beacon, as well as, fund a foundation to promote online privacy.
Beacon is a Facebook marketing program. The program was based on “trusted referrals”. A Facebook members’ friends would be notified of purchases made through Beacon. The problem was… Facebook members did not know they were part of the Beacon program. They were automatically opted-in.
There was trouble with the program right from the start. Members complained about holiday gifts they were giving and receiving. In 2008, a lawsuit was filed on behalf of 19 members against Facebook, as well as, Blockbuster, Fandango, Overstock.com, and other companies that were in the Beacon network. To settle the suit, Facebook has agreed to stop Beacon and start a foundation to promote online privacy, safety and security by funding $9.5 million.