Big Data and Internet Privacy

A couple years ago, I was talking to a family friend of ours, and he summarized our online experiences very neatly in one sentence.  "If you are not paying for the product, then you are the product."  This really struck me at the time.  Often, we do not put much thought into what we do online and what data we make available to the websites where we generate and interact with content. The recent Facebook experiment was an interesting piece of this puzzle.  For me, the line that stood out the most in the New York Times article was that "doing psychological testing on people crosses the line."  Where exactly is the line between privacy and business?  Without acknowledging the consumer's role in internet and technology companies (especially web-based), one might conclude that these companies make money via black magic.  Google, for example, makes more money the more data it can gather, interpret and essentially, sell.  The more data they have, the better they can serve advertisements, and the more advertisers will pay to have more effective advertisements placed.  I also find the algorithmic complexity of Facebook to be really interesting.  I was aware of how Facebook filters the content that you see, but was not aware of how much actually goes on.  From 1500 potential items down to 300 is quite a reduction.  I do remember reading a little about the Facebook emotion study that this article talks about around when this happened.  They were discussing how people filter out their own newsfeed as much or more than Facebook's algorithms do. After all, if our newsfeeds were filled with content that we did not want to see or did not agree with, then why would we use Facebook and then how would Facebook get its revenue?