Facebook announced Monday that the social networking site is shutting down its much-maligned Beacon marketing program, according to Associated Press.
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The program was launched nearly two years ago, receiving positive responses, but began to generate an onslaught of privacy complaints over tracking of user activities at partner Web sites.
Facebook agreed to end Beacon and create a foundation to promote online privacy, safety and security as part of a $9.5 million settlement in a lawsuit over the program. A federal judge in
Facebook thought the Beacon marketing program would help users keep their friends better informed about their interests while also serving as "trusted referrals" that would help drive more sales to the participating sites. In addition to status updates and photos, the program offered alerts on what items their friends had bought or reviewed.
However, the alerts began to be a nuisance to users who did not care to see every gift their friends purchased on Overstock (NASDAQ: OSTK) or movies purchased on Fandango.
After an uproar, Facebook ultimately let users turn Beacon off, and CEO Mark Zuckerberg publicly apologized for it. Facebook said late Friday it agreed to end it as part of the proposed settlement.
The lawsuit was filed in August 2008 on behalf of 19 users against Facebook, as well as Blockbuster Inc. (NYSE: BBI), Fandango, Overstock.com Inc. and other companies that used Beacon. It claimed the defendants disclosed users' personal information for advertising purposes, without their consent.
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