It’s been an eventful week for Facebook’s execs and legal team. Two weeks after the company released an updated Terms of Service, the company has decided to temporarily revert its Terms of Service to the previous version after complaints from some users and privacy advocates while a new document is drafted.

Writing in the Facebook blog again today, CEO Mark Zuckerberg said,

Many of us at Facebook spent most of today discussing how best to move forward. One approach would have been to quickly amend the new terms with new language to clarify our positions further. Another approach was simply to revert to our old terms while we begin working on our next version. As we thought through this, we reached out to respected organizations to get their input.

Going forward, we’ve decided to take a new approach towards developing our terms. We concluded that returning to our previous terms was the right thing for now. As I said yesterday, we think that a lot of the language in our terms is overly formal and protective so we don’t plan to leave it there for long.

More than 175 million people use Facebook. If it were a country, it would be the sixth most populated country in the world. Our terms aren’t just a document that protect our rights; it’s the governing document for how the service is used by everyone across the world. Given its importance, we need to make sure the terms reflect the principles and values of the people using the service.

Our next version will be a substantial revision from where we are now. It will reflect the principles I described yesterday around how people share and control their information, and it will be written clearly in language everyone can understand. Since this will be the governing document that we’ll all live by, Facebook users will have a lot of input in crafting these terms.

Facebook has created the Facebook group Facebook Bill of Rights and Responsibilities for users to give input about the site’s terms.

Concerns about the updated terms of service have largely revolved around the “Licenses” section, which gave Facebook a broad set of rights regarding content users publish to the service – even if they delete their account.  It read:

You are solely responsible for the User Content that you Post on or through the Facebook Service. You hereby grant Facebook an irrevocable, perpetual, non-exclusive, transferable, fully paid, worldwide license (with the right to sublicense) to (a) use, copy, publish, stream, store, retain, publicly perform or display, transmit, scan, reformat, modify, edit, frame, translate, excerpt, adapt, create derivative works and distribute (through multiple tiers), any User Content you (i) Post on or in connection with the Facebook Service or the promotion thereof subject only to your privacy settings or (ii) enable a user to Post, including by offering a Share Link on your website and (b) to use your name, likeness and image for any purpose, including commercial or advertising, each of (a) and (b) on or in connection with the Facebook Service or the promotion thereof.

As a result of these concerns, the Electronic Privacy Information Center yesterday announced it was going to file a complaint with the FTC requesting Facebook revert its terms of service. In addition, almost 70,000 Facebook users joined a Facebook group called People Against the New Terms of Service.

For now, Facebook’s ToS is back to the version it had published before the February 4th change – “which was what most people asked us for and was the recommendation of the outside experts we consulted,” Zuckerberg says. In the meantime, Facebook will be working through the complex challenges of reflecting the “principles and values” of its 175 million global members – as well as its corporate counsel – in one document.

According to IDC, Internet users spend an average of 32.7 hours online each week. That’s nearly half the time they spent with any media (70.6 hours), more than twice the time they spent with TV (16.4 hours) and eight times as much time as they spent reading magazines and newspapers (3.9 hours). Attention is clearly shifting online, and more and more it’s shifting to “social media” properties (Facebook, MySpace, Wikipedia, Blogs, YouTube). Despite a slowdown, the ad dollars are following.

The question has become how to invest those dollars. Up until now, online ad spending has meant search and display (2008 est. $10.7 and $4.6 billion respectively). The fastest growing categories, however, are video (81%), social networking (33%), and social media overall.

New Media, Old Metrics

But marketers are having a hard time wrapping their head around the ROI from these new media campaigns. There’s currently a metrics vacuum in the social media space and it’s being filled with traditional metrics pulled from search and display. The only problem is that these metrics don’t make sense for brand campaigns in social media.

Branding campaigns don’t have a conversion event, like search advertising. Click through rates and impression volume used to gauge display campaigns are radically different on social media properties. Blogs average a little over one page view per visit, while social networking properties average in the tens or hundreds. It’s not apples to apples. While impressions do adjust behavior, clicks and conversions also carry a whole different meaning within social media. People click to send messages, make friends, comment, and share.

Perhaps it’s been the past five years of Google AdWords and AdSense, but the focus on clicks and impressions has driven a rather myopic view of ROI in covering social media campaigns. Most recently, it’s been the coverage of P&G’s Crest Whitestrips campaign with Facebook.

The article highlighted a 2006 campaign with P&G that drove 14,000 fans to their fan page. In the article’s words this was really 14,000 clicks because “Becoming a “fan” required nothing more than a single click“. However, the more accurate way to look at it is that P&G found 14,000 people who were interested enough in Crest Whitestrips to stand and be counted. These people are a resource P&G could tap with early product releases or product input.

In marketing terms, the analysis focuses on the reach of the campaign and not the depth of engagement. Display and search don’t have the power to have an ongoing conversation with their audience. Consequently the campaign is under-utilizing the social networking medium.

Where’s the Beef?

When brands and journalists are asking “Where’s the beef” in social media, but measuring by clicks, they’re selling themselves short. Optimizing a brand campaign around clicks is like paying a pianist by the note. You end up with no message, just noise.

More intelligent social media campaigns have to balance reach and engagement. Messages must be appealing and integrated as to drive reach, while at the same time being meaningful enough to build brand equity through engagement. At SocialMedia, our recommendation is a unique blend of both, which we call “positive word of mouth” campaigns. Companies like Context Optional and BuddyMedia approach the problem through social applications. Each have their own metrics for success.

The real “beef” from these campaigns will come when marketing reports come out over the next few months. Then we’ll see how these campaigns deliver on lifting brand recall, loyalty, and adjust purchasing behavior.

This is a guest post by Nick Gonzalez of SocialMedia. You can also find Nick on his blog.

Offerpal Media, one of the leading “managed offer” monetization platforms for social app developers, has just announced the close of a $15 million Series B financing lead by D. E. Shaw Ventures. Existing investors InterWest Partners and North Bridge Venture Partners participated in the round.

Offerpal has gained notoriety amongst social app developers for the very high eCPMs it is able to generate in many apps, sometimes in the $100′s of dollars.

The company said it will use the growth financing to expand its managed offer platform in 3 primary ways:

• Extending the offering on to new platforms, like mobile (it recently launched on the iPhone).
• Internationalizing the service – specifically into Asia and Europe, where game developers are making a killing.
• Creating new monetization products for publishers (the company would not comment on any specifics).

New investor D. E. Shaw is betting on the continued growth of social apps and games and Offerpal’s incentivized offer strategy.

“Offerpal’s approach of blending targeted, relevant advertising offers with virtual currency has really caught on with publishers and advertisers alike, and with the company’s strong leadership team, sophisticated technology platform and expansive network of publishers, we believe Offerpal is well positioned as a leader in the space,” said D. E. Shaw’s Michael Banks.

Offerpal would not disclose valuation, but anecdotal evidence from top app developers says the company is doing very well.

Note: Offerpal is a sponsor of this blog.

Two weeks ago, Facebook announced that it had updated its terms of service, consolidating its various documents into one. Today, CEO Mark Zuckerberg responded to concerns some have expressed about changes to the way Facebook treats ownership of user data.

Zuckerberg writes,

Our philosophy is that people own their information and control who they share it with. When a person shares information on Facebook, they first need to grant Facebook a license to use that information so that we can show it to the other people they’ve asked us to share it with. Without this license, we couldn’t help people share that information.

One of the questions about our new terms of use is whether Facebook can use this information forever. When a person shares something like a message with a friend, two copies of that information are created—one in the person’s sent messages box and the other in their friend’s inbox. Even if the person deactivates their account, their friend still has a copy of that message. We think this is the right way for Facebook to work, and it is consistent with how other services like email work. One of the reasons we updated our terms was to make this more clear.

In reality, we wouldn’t share your information in a way you wouldn’t want. The trust you place in us as a safe place to share information is the most important part of what makes Facebook work. Our goal is to build great products and to communicate clearly to help people share more information in this trusted environment.

We still have work to do to communicate more clearly about these issues, and our terms are one example of this. Our philosophy that people own their information and control who they share it with has remained constant. A lot of the language in our terms is overly formal and protective of the rights we need to provide this service to you. Over time we will continue to clarify our positions and make the terms simpler.

In particular, the section of the TOS which has elicited the most response is Facebook’s updated “Licenses” section, which states:

You are solely responsible for the User Content that you Post on or through the Facebook Service. You hereby grant Facebook an irrevocable, perpetual, non-exclusive, transferable, fully paid, worldwide license (with the right to sublicense) to (a) use, copy, publish, stream, store, retain, publicly perform or display, transmit, scan, reformat, modify, edit, frame, translate, excerpt, adapt, create derivative works and distribute (through multiple tiers), any User Content you (i) Post on or in connection with the Facebook Service or the promotion thereof subject only to your privacy settings or (ii) enable a user to Post, including by offering a Share Link on your website and (b) to use your name, likeness and image for any purpose, including commercial or advertising, each of (a) and (b) on or in connection with the Facebook Service or the promotion thereof.

In other words, by using Facebook, you’re (legally) giving Facebook a broad set of rights regarding any content you publish to the service – even if you delete your account.

As is the case with most websites, most users are unlikely to be terribly concerned with changes to the Terms of Service unless something bad were to actually happen. While the theoretical and legal debates around privacy certainly abound, ultimately, the operative word in this discussion is “trust.” And Facebook is certainly deeply aware that its continued success significantly depends on its ability to maintain increasing trust with its ever growing user base (now 175 million people around the world).

Facebook is at the forefront of many complex privacy issues facing large consumer web companies. Not only does it face complex challenges of balancing revenue-generating priorities with user privacy, but it also faces complex challenges of balancing user desires for complete control of their information with user desires to grant others some control over certain parts of their information as well.

As Zuckerberg writes,

People want full ownership and control of their information so they can turn off access to it at any time. At the same time, people also want to be able to bring the information others have shared with them—like email addresses, phone numbers, photos and so on—to other services and grant those services access to those people’s information. These two positions are at odds with each other. There is no system today that enables me to share my email address with you and then simultaneously lets me control who you share it with and also lets you control what services you share it with.

We’re at an interesting point in the development of the open online world where these issues are being worked out. It’s difficult terrain to navigate and we’re going to make some missteps, but as the leading service for sharing information we take these issues and our responsibility to help resolve them very seriously. This is a big focus for us this year, and I’ll post some more thoughts on openness and these other issues soon.

We’ll continue following Facebook’s approach to user control and ownership of information – as well as the way Facebook handles related issues for businesses and developers operating on the Facebook Platform and through Facebook Connect.

Last fall, Facebook launched a major site redesign that primarily impacted the profile page, home page, and application developers. With the redesign, the Facebook profile page changed from a “box-oriented” design to a “Wall and tabs” design to make sharing more prominent and viral. Now, Facebook is preparing advertisers and brand managers for a similar redesign to its Pages product for businesses that could launch as soon as sometime in the next few weeks.

With the Pages redesign, business Pages will now look much more like Facebook profile pages. According to information provided to advertisers, Facebook is moving Pages to a “Wall and tabs” design:

• The Wall tab, containing all the latest updates and Wall posts, will become front and center.
• Most static information will live on an “Info” tab, and most Photos will now live on a “Photos” tab.
• Most custom content and application boxes will be moved to a “Boxes” tab, though some narrow boxes can remain on the “Wall” tab.
• Page admins can add more application tabs to their Page if they so choose.

In addition, Page admins can now share Status Updates on their page like regular Facebook users can on their own profile.

Full screenshots and details on all the changes, including the steps that Page managers need to take to migrate and optimize their Pages to the new design, are below.

Above: New design of Facebook Pages (from Facebook newsletter)

The New Wall Tab – Making Pages More Dynamic and Viral

Like the redesigned Facebook profile pages, Facebook Pages for business will now be focused on the “Wall.” This means that Notes, Photos, and other information shared by businesses, celebrities, and musicians – along with content shared by Fans as well if the Page admin desires – will appear front and center. This design will make Pages feel much more dynamic and active.

In addition, content posted on the new Wall will show up in Fans’ News Feeds more often. Just like information shared by your Facebook friends shows up in your News Feed, information shared by Pages you’re a fan of will now show up more. This means posting updates to your Facebook Page is now a lot more viral, as more News Feed distribution could drive significant traffic to your Page.

Finally, Page admins will be able to choose default settings for a) who can post to the Page’s wall, and b) what the default view of Wall posts is. Admins can either allow only other admins to post content to the wall, OR allow Fans to post to the Wall too. However, even if Fans are allowed to post, Page admins can still set the default view of the Wall to “Posts by Admin.”

Status Updates – Now for Pages, Too

In addition to being able to share photos, videos, and notes on Pages, Page admins will now have a powerful tool previously only on Facebook profile pages – Status Updates. With Status Updates, Page admins can now post short blurbs that Fans might find really interesting and engaging. Status Updates have the potential to become a very powerful tool for brand managers.

Application Boxes – Changing Places

With the Pages redesign, application boxes, which appeared on the old Page anywhere below the core info modules, can show up in one of two places: 1) narrow boxes can show up in the left column of the Wall tab, much like they can on Facebook profile pages, or 2) on the new “Boxes” tab. This means that there are now more constraints on where custom content and application boxes can appear on Pages.

For those Page owners who have added custom content or application boxes to your Pages, your boxes may not appear in the same arrangement on the Boxes tab as they did before. You’ll need to check your Page’s admin settings when the redesign launches to make sure your boxes are in the desired location.

Tab Management – Choosing a Landing Page

Now that Facebook Pages have multiple tabs, Page admins can choose which tab to show non-Fans when they land on the Page.

Which tab should Page owners choose for non-Fans to land on? For most, the Wall or Info tabs will likely be the best choice. However, Page admins who have developed custom content might also want to choose the Boxes tab or a custom application tab (application tabs can now be added to Pages, just like they can on Facebook profile pages). The Boxes tab should look a lot like the old Facebook Pages for those who added custom modules.

No matter which tab admins choose, both Fans and non-Fans can be driven to any specific tab through ads. And Fans who arrive at the Page organically will always be taken to the Wall tab.

Choosing a Profile Picture

Finally, Page admins should make sure that a profile picture is selected for the Page. Previously, Pages could have FBML, Flash, or iFrame boxes set as their profile picture, but with the Pages redesign, all Pages will need a standard image.

Conclusion

In summary, updates to the design of Pages should make Pages more dynamic and viral, and a more powerful overall product for brand managers, artists, celebrities, and small business owners. Increased distribution in the News Feed should provide great incentive to Page owners to update their Pages regularly and drive more traffic to their Pages through ads.

While no specific timetable for these changes have been confirmed, Page admins should be aware of the upcoming changes and be prepared to both 1) get the most out of the updated Pages product, and 2) ensure that they do everything they need to do to migrate and optimize their current Pages. Key steps that current Page owners should take when the new Pages launch are:

1. Ensuring that a profile picture for the Page is set.
2. Configuring tab settings – both choosing the “landing tab” for non-Fans and choosing who can write on the Wall.
3. Rearranging boxes on the Boxes tab, if necessary.

Ultimately, Facebook’s goal in making business Pages more powerful is to increase the ROI businesses get when promoting Pages through Facebook Ads. From what we can tell, these changes should do just that.

While “business pages” in other social networks often have a very spammy feel, the updated Pages design still preserves the authenticity of Fan endorsement. The new Facebook Pages have the potential to become much more lively and engaging touch points for reaching your customers in a very authentic, powerful, and extremely targeted way.

Facebook declined to comment further at this time.

Check out the latest news & insights this week from Inside Social Games:

• Mobile Payments on Social Platforms: Q&A with Zong’s Hill Ferguson
  – Mobile payment services are exploding on Facebook and other social networks as an easy way for app users and game players to buy virtual currency. Read more in our interview with Hill Ferguson of Zong, one of the leading providers of mobile payment solutions to social app developers.
• Ten Reasons that Social Games May Eat the Casual Market – Casual Games haven’t become the all-encompassing juggernaut that some people were predicting  they would be a few years ago. Meanwhile, Social Games are quickly expanding into exactly the same market. So are Social Platform Games just casual plus plus, or are they the new bigger better thing?
• New Sports Themed Social Games Are Coming Soon – A lot of buzz around the watercooler these days seems to be about virtual worlds focused on sports. Two companies in particular, GamesCampus and Cybersports, are building products in this space.
• SGN Launches Mafia: Respect and Retaliation for the iPhone – With the Mob Wars legal saga behind it, SGN has just launched a new mob-based title called Mafia: Respect and Retaliation for the iPhone.
• How Social Games Saved the PC Gaming Market – Although there have been good times and bad times, the PC gaming market has always been a bit of a lurching monster. How are social games saving this huge market?
• Action AllStars Reaches 100k Registrations – Action AllStars has hit 100,000 registered users since the beta launched in December. Read on to learn more about this new sports-themed virtual world.
• iGames Summit Coming to San Francisco March 19 – The iGames Summit, a half-day conference focused on the emerging iPhone games space, is coming to San Francisco on March.

Last November, CNN and Facebook partnered to create a very successful Facebook Connect integration on CNN.com/Live during President Obama’s inauguration. Now, Facebook and CNN parent Turner Broadcasting are partnering again to create similar Facebook Connect integrations for the NBA All-Star Game this weekend and President Obama’s national address (not officially a State of the Union address) next week.

NBA All Star Game / TNT Integration

The NBA All Star Game integration works very similarly to the CNN inauguration integration. Facebook users can authenticate through Facebook Connect and publish status updates directly from TNT’s website while watching live.

CNN.com Live Integration During Obama’s Address to the Nation

Similarly, during President Obama’s address to the nation next Tuesday, February 24, CNN.com/Live will allow users to watch Obama’s address and share status updates through Facebook Connect just like on inauguration day.

These integrations are great examples of the way Facebook Connect can help media companies increase audience engagement during live broadcasts. Publishing status updates through Facebook Connect gives audiences a powerful opportunity to share content and events they’re passionate about with hundreds of friends.

We’re all well aware of the many web tools that exist to help us make ourselves more social, efficient, effective, etc — Facebook being one of the many. Some of us use so many that managing the tools themselves often requires another utility. It’s becoming increasingly complicated, and as a solution, Inside Facebook recently discussed syncing Twitter and Facebook status updates for all those who want to sync their updates on both sites.

Well, for those out there who use Google and Facebook to manage events and calendaring, here’s another how-to that might not only make your busy lives a little less complicated, but will relieve you of the pain of having to keep up between multiple calendars.

How to Sync Facebook Events with Google Calendar

1) After you log into Facebook, click on “Events” in the right-hand panel.

2) Then click on “Export Events” and copy the URL (which you will use later). Make sure you keep the address of the URL to yourself, lest everyone have access to your Facebook events…

3) Log into Google Calendar and choose “Add” under “Other calendars.” Then choose “Add by URL”

4) Paste the URL you copied from Facebook and click “Add”

Voila, you’re done! Your Google calendar will now update automatically every time you accept or decline an event in Facebook.

Enjoy being even more organized!

Facebook has hit the 175,000,000 active user mark, just 5 weeks after it hit 150 million users in January. At this rate, Facebook has been growing by well over 600,000 users per day over the last several weeks, continuing the company’s torrid growth pace.

If Facebook were a country, it would now be the 6th most populous in the world.

Where is all the growth coming from? As we’ve been tracking closely, Facebook has been growing very rapidly amongst women and people over 30 in the US, and it has been absolutely exploding internationally (January highlights).

• 45% of Facebook’s US audience is now 26 years old or older.
• The fastest growing segment in the US: Women over 55, up 175.3% in the last 120 days. Facebook growing faster with women than men in almost every age group.
• The number of people on Facebook grew by over 10% monthly in 52 countries in January. It grew by over 20% monthly in January in 13 countries.
• Facebook’s monthly growth accelerated by at least 25% in 30 countries in January vs. December 2008.

Clearly, Facebook’s population is changing. It’s becoming much more diverse demographically, and it’s becoming a LOT bigger. Marketers and developers still evaluating whether to participate in the Facebook ecosystem have millions more reasons to get involved literally every week. Inside Facebook is here to help.

Back in November, Facebook announced an update to its platform terms of service with respect to alcohol advertising that allowed developers to place ads for alcoholic beverages for the first time – as long as they used Facebook’s Demographic Restrictions functionality to prevent access to alcohol related ads by anyone under 21.

At the same time, Facebook announced that starting early this year it would require that “all content related to alcoholic beverages — including unbranded, generic drink images — be available only under Demographic Restriction.” This meant that developers allowing users to do things like “sending a drink” or other kinds of alcoholic themed virtual goods would now need to use Demographic Restrictions as well.

While the deadline for developers to implement these restrictions was originally set for early January, that date was pushed back while Facebook finalized the policy and APIs, taking developer feedback from early beta tests into account. Facebook recently announced that the new deadline has been set for March 6th.

Full details on alcohol content policies can be found on the Facebook Developer Wiki here.