Facebook backlash: Alternative social networking sites see an opportunity

By Sarah Klein

As you've undoubtedly heard, Facebook  has come under fire lately for changes to its privacy policies that encourage and enable the sharing of members' personal information with third parties without their consent.

While some savvy users were able to log on and block the third party apps, bloggers, journalists and other Facebook users were up in arms at how difficult the opt-out process had become. Last week, Facebook attempted to appease the angry mob by simplifying the privacy control settings and promising not to make the same mistakes again.

But to some extent, the damage had already been done. In recent weeks, a smattering of new networking sites have sprung up, hoping to take advantage of the growing dissatisfaction with Facebook and prize away some of its 400 million plus members.

One of the first to receive major press coverage is Diaspora, set to be released in full in September. Dubbed "the anti-Facebook" by the BBC, Diaspora is aimed at users who are more cautious about what they post online and how it could be used outside of their control. "When you give up that data," 22-year-old co-creator Max Salzberg told the New York Times, "you're giving it up forever."

In a video on their site, the founders explain how each user will be personally responsible for their own "node" within the Diaspora network. This way, the team argues, sharing and privacy don't have to be mutually exclusive.

The race is on to between Diaspora and a handful of similarly privacy-minded startups. One such service, Pip.io, already had 20,000 registered users before being featured in the New York Times. (The exposure reportedly doubled registrations overnight.) Co-founder Leo Shimizu describes the site as a social operating system; a platform for Facebook, Twitter, and YouTube, similar to how Windows allows you to alternate between Word, Excel and numerous other programs.

Or there's Bebo, an AOL service based in San Francisco that's popular in other countries but just beginning to spark interest stateside. Bebo's features are similar to those on Facebook, but settings default to the most private, a welcome change for those who feel too exposed on Facebook.

Google's own social network, Orkut, has also grown in popularity overseas but doesn't have many fans in the U.S. It requires a Gmail account to register and is simpler to use than Facebook, but has great privacy settings, including the ability to block users and report all sorts of misuse.

Many other startups, like OneSocialWeb, Crabgrass, and AllMyBiz are also vying for attention. Some older networking sites, like LiveJournal or Friendster, might even stage a comeback.

With its army of followers, Facebook isn't going away any time soon, but the increased competition can't do any harm. Companies that face healthy competition have a habit of becoming much better listeners!