Following the furor over the new Facebook Beacon product, the company has decided to back-off and offer a complete opt-out to the product. Mark Zuckerberg explains on the Facebook blog:

Facebook has succeeded so far in part because it gives people control over what and how they share information. This is what makes Facebook a good utility, and in order to be a good feature, Beacon also needs to do the same. People need to be able to explicitly choose what they share, and they need to be able to turn Beacon off completely if they don’t want to use it.

This has been the philosophy behind our recent changes. Last week we changed Beacon to be an opt-in system, and today we’re releasing a privacy control to turn off Beacon completely. You can find it here. If you select that you don’t want to share some Beacon actions or if you turn off Beacon, then Facebook won’t store those actions even when partners send them to Facebook.

What it means: as Scoble said yesterday, this is a perfect example of a badly handled PR situation.  Facebook should have come out sooner to solve this obvious privacy issue. “Do the press conference. Admit you screwed up. Take your shots. Look into the camera and say you’re sorry.” said Scoble.  I think the last straw was the fact that, even though you declined to share your information on Facebook, the info was still sent to Facebook from third-party web sites.  This move should reassure most people but make sure you opt-out if you’re still worried.