Risky strategy
That's where Facebook is going drastically wrong. I'll be fair and assume its "deploy first, apologize later" strategy is based on the social networking axiom that value increases with mass usage. After all, Facebook's advertisers and website partners aren't going to be impressed with Instant Personalization unless the initial user base is, well, everyone on Facebook.
But making the advertisers happy at the expense of user satisfaction is at best risky and at worst stupid. Maybe Facebook is banking on the likelihood that its subscriber base won't suffer as a result. But the bad publicity could hurt future subscriber growth and encourage existing users to simply delete as much public info as possible, which devalues the entire proposition.
Ironically, the idea of, say, Pandora or other music services using your Facebook profile to automatically tailor your playlist is a good one that would probably go over well with music fans. Facebook undoubtedly feels people will appreciate what they're proposing more if they experience it for themselves first.
But the reality is that it's not just what you offer, but how you do it. And in an age where many people are learning the hard way that what you post online can get you in big trouble (and can be stolen and used against you), leveraging personal data requires more than just forcing a feature on people and saying, "Trust me, you'll love it."
However it plays out, the Facebook debacle should serve as a cautionary tale to any and all service providers hoping to leverage customer data to roll out personalized services: above all else, trust matters, and trust is earned.