Facebook's privacy pullback isn't just outrageous; it's a landmark turning point for the social network. Facebook has blundered before, but the latest changes are far more calculated. The company has, in short, turned evil.

Its new privacy policy have turned the social network inside out: millions of people have signed up because Facebook offers a sense of safety. For the last five years — as long as you're relatively careful about who you accept as your friends — what you do and say on Facebook for the most part stays on Facebook. Katie Couric's daughter first posted pictures of her famous mom dancing silly in 2006, but it took three years for them to leak to us. (Thank you tipsters!) But virtually overnight and without a clear warning, Facebook has completely reversed those user expectations. Their new privacy settings amount to making anything you post on Facebook to be public, unless you go to great lengths to keep your info private.

The most insidious part of Facebook's scheme to expose user data has been how the company framed them, claiming to want to enhance privacy. In an open letter to his 350 million+ users, CEO Mark Zuckerberg claimed he believed the old privacy framework was "no longer the best way for you to control your privacy," and that the new system would give people "even more control of their information." It would be "simpler" and finer-grained.

But when the system came out a week later, it actually gave less, not more, control over information. Gone was the ability to hide your friends list, profile pictures, fan pages and network membership from all strangers; Facebook's new, formal privacy policy explicitly made this information public (despite the ability to keep some of it, like the friends list, off your profile page).

Meanwhile, the social network is pushing users hard to share their personal content with strangers. Users are being forced to update their privacy settings, with most default choices set to "Everyone" in the world or "friends of friends."

Facebook's business rationale here is clear. Rival Silicon Valley startup Twitter has grown extremely quickly in the last few years, almost entirely on the back of public content — from celebrities, people's friends and users' professional colleagues. That has brought traffic, money from search engines and a $1 billion valuation.

Facebook wants in on that kind of growth, and more public content means more traffic. But Facebook has historically been one of the most private of the social networks, functioning as a sort of safe alcove amid the chaos of MySpace and Friendster. "Privacy is a big reason Facebook users are so loyal," BusinessWeek's Sarah Lacy wrote in 2006 (via Big Money).

So Facebook needed to give users a big shove to put its business plan into play. As startup founder Jason Calacanis puts it,

Facebook is trying to dupe hundreds of millions of users they've spent years attracting into exposing their data for Facebook's personal gain: pageviews. Yes, Facebook is tricking us into exposing all our items so that those personal items get indexed in search engines–including Facebook's–in order to drive more traffic to Facebook.

But it's not just that Facebook is tricking its users; it's betraying them. It did so when it literally communalized private friend lists that people spent years accumulating, without which their accounts would be useless. It did so when it mislead them by saying it wanted to enhance their privacy, when the real goal was growth and profit. And it continues to do so every day it does not respond to the loud fedback of its users (and the implicit feedback of its own CEO).

And people increasingly know they've been betrayed. This past weekend, journalist Dan Gillmor publicly deleted his Facebook account. Heidi Moore at Slate's Big Money temporarily deactivated her account as a "conscientious objection." And look at the big-name tech journalists weighing in on all the shock and outrage on Facebook critic Calacanis' "Wall" (click to enlarge):



Facebook has been through embarrassing privacy snafus before, like the intrusive "Beacon" advertising system, which the company eventually abandoned. But this one was so pre-meditated, so pre-processed and so condescendingly hyped and spun in advance. It's obvious that Facebook is making a calculation, one that, for users, involved a lot more subtraction than addition. Barring mass defections, the difference will drop straight to Facebook's bottom line.

UPDATE: Our other coverage:
The Facebook Privacy Settings You've Lost Forever, Dec. 16
The Valleywag Guide to Restoring Your Privacy on Facebook, Dec. 15
Facebook CEO's Private Photos Exposed by the New 'Open' Facebook, Dec. 11

(Top pic: Zuckerberg, by Josh Lowensohn)