When you join facebook you're joining a free to use data-silo, most of which is not open to the internet - the site is predicated on hiding your data from the world (and esp. google), and then selling it on to advertisers and other businesses, sometimes anonymised, sometimes not. Beacon is a perfect example of the sort of uses you can expect them to put your data to in future. All the data from like buttons, your social graph etc, is invaluable to them, and invaluable to advertisers and retailers.
The logical conclusion of that is they have absolutely no incentive to give you your data back, in fact they view that as their data, earned by offering you the service of sharing stuff with your friends, without having to set up your own website. That data is their crown jewels, so I am amazed that anyone would expect them to give it up, or be surprised at their reluctance - this is the very essence of Facebook, and they've done very well out of it.
That's not to say that you should never use Facebook, but just that if you do use a free service like Facebook, you should expect to give up some of your privacy and control over your data in return. If you don't want to do that, it would be better to use another service (which doesn't rely on selling your data as their business model).
If you are not in the USA (and maybe Canada) and you sign up to Facebook, you are signing an agreement with Facebook Ireland Ltd., a company registered in the EU and, hence, subject to EU law.
One part of EU law is that people have the right to access all personal data that a company holds on them. Here's an example of how to make such a request. http://europe-v-facebook.org/
You might claim "people voluntarily choose to join a free service, what right do you have to demand anything?" however that's not how laws work. Facebook is legally obliged to give non-US customers their data.
That's really interesting, I had no idea they were incorporated in Ireland too and hence sometimes subject to EU law (in theory at least). Thanks for the link. I'm not actually a member, but I'd be interested to see what they produce on other people just to see what sort of data they're holding.
I believe it's done as a tax dodge, so they can book some of their income in Ireland (which has low corporate taxes). May not have fully realized the privacy-law implications at the time they set that up. Either that or the savings are enough to be worth it.
In the crude sense of collecting all your posts and sending them all to an advertiser, of course not. In the sense of selling your interests, friends, social position, age etc to advertisers as a datapoint, yes they do; that's how they target ads and make money. They also tried to harvest purchasing habits from other sites like Amazon (with Beacon), and give broad access to developers, some of whom abuse the privilege and have been caught selling data on. I'd expect that sort of activity to increase post-IPO. They're not alone in this of course - gmail does the same, without the data lock-in.
No, they do not sell interests to advertisers. What they do is allow advertisers to show their ads to people with those specific ages, interests, and such. It's a subtle and important difference: with this method, advertisers only know that their ads are being shown to someone who matches their criteria, not who. Advertisers are not able to correlate your identity with ad targeting.
No, they sell services using it. Advertisers and others who give Facebook money do not see user information; they just pay to leverage it for effective targeting.
I think you're missing the point. Facebook doesn't have to hand out a text file with your name and a list of all your friends for it to be considered "selling your data".
It's considered "selling your data" when you go to an unrelated site and that site gives you customized content based on information you gave to Facebook.
That does not happen either; user data is not given to third parties. I do not work at Facebook; however, this has been clearly and repeatedly stated by them (including, I believe, in legal filings).
The logical conclusion of that is they have absolutely no incentive to give you your data back, in fact they view that as their data, earned by offering you the service of sharing stuff with your friends, without having to set up your own website. That data is their crown jewels, so I am amazed that anyone would expect them to give it up, or be surprised at their reluctance - this is the very essence of Facebook, and they've done very well out of it.
That's not to say that you should never use Facebook, but just that if you do use a free service like Facebook, you should expect to give up some of your privacy and control over your data in return. If you don't want to do that, it would be better to use another service (which doesn't rely on selling your data as their business model).