This blog post from the New York Times is an excellent summary of what has happened since Facebook launched their Beacon advertising service in November 2007.

Beacon is a programme that allows their advertising partner sites to prompt Facebook users on their website to post information about what they are doing back to their Facebook profile.

What happened when they launched was that this information was being sent by default, unless you specifically opted out of the service. The result was a massive campaign online to petition Facebook to change this to an opt-in service.

Facebook was accused of ruining Christmas as boyfriends inadvertently told their girlfriends, via the Facebook News Feed, what gift they had just purchased for them.

Anyway, read the post as it is an excellent synopsis.