Facebook made some key improvements to its privacy settings today that will help people manage their social networking identities by controlling access to who sees what on their profile pages with greater specificity than ever before.

It also represents a pretty wily business move on the part of the emerging Silicon Valley giant, Larry Ponemon, a privacy expert, told me today.

Here at CIO, we looked at this announcement with a lot of interest. We've had many discusssions and e-mail threads with our readers about the difficultly of managing your social networking identity for your personal and professional lives, first in a post I made to our advice and opinion section, and again in a feature article about how employees have dealt with the issue in the workplace.

Before this upgrade, Facebook users had the ability to control access to their profiles by allowing their chosen friends and networks (city, company, interest group, etc.) to view their entire profile or a "limited profile," which set controls around some (but not all) of the information people could see.

Anyone with access to your profile could also view the names of your entire friend list. So your boss, for instance, provided he or she friended you, would be able to essentially see a thumbnail picture of all the friends you might have dated or hang out with, and their names.

Not anymore.

Now, as Justin Smith wrote in Inside Facebook (which also has a great bullet point summary of the announcement), you can decide to share basic and personal information with all of your friends, some of them, one of them, or none of them at all. You can also shield your friend list from any or all of your friends and networks.

Dr. Larry Ponemon of the Ponemon Institute, a privacy and business ethics think tank, told me today that the improvements represent a new opportunity for Facebook users to control access, but wonders if they'll take advantage of it. "The privacy tool gives you more granularity in terms of who sees what," he says. "Despite all these features, however, people are fundamentally lazy. I think many will accept the default settings."

In addition, he says those who decide to control privacy closely might empower Facebook with unprecedented marketing and advertising opportunities. For instance, if you set access in such a way so two out of your 100 friends only have access to your most personal information, Facebook could provide clients with a place to serve up an amazingly targeted ad to those two friends (under the presumption they are the most like you).

For instance, if I set control so two of my friends had the greatest access to my profile information, an advertiser such as Amazon could analyze my specific interests (media, technology, Red Sox and golf) and offer books around those topics to my two closest friends.

According to a study Ponemon did recently of 900 people in the workplace aged 18-25, nearly 54 percent said they're likely to use a social network with enhanced privacy controls. If it wasn’t already (and, frankly, I suspect it was), Facebook will probably be their brand of choice.

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