This is why I quit -- I already have an everything-public social network that I like (Twitter), I don't need a second. People migrated to Facebook from MySpace because of privacy/clique thing, I imagine they'll go elsewhere eventually. FB will live on, but it'll be different.
People keep saying this, but the point is that Facebook got traction to begin with because it was highly private (only open to a small number of Ivy League colleges), and even later had strict privacy settings. Many people who joined never intended to sign up for a public service at all, and many still don't realize that the privacy level has shifted gradually from a kind of gated community all the way to Twitter.
If they had started the service today advertising the settings they have now, I think they would have trouble getting users.
Even if they kept the privacy settings intact, I think my point would still be true because of basic network effects.
In the beginning, only other college students were on. Now that FB has spread out to the world at large, my FB social network is pretty close to my actual social network. A friend of mine has account, but hardly uses it pointing out, "What am I going to say on Facebook? I'm friends with my mother-in-law." I'm not as restricted a user, but I still don't say much.
Now if you'll all excuse me, I'm off to update my status to "I'm a team-oriented go-getter who is passionate about delivering value to my employer".