I read _Brave New World_ this weekend. I think Huxley's vision of dystopia is closer to the bone than Orwell's - we see in facebook that people (including me!) want to join what would in the wrong hands be a very effective police-state tool. "Tell us who your friends are."
The article seems to imply Google has backed off from ad targeting. I don't think so. An email I got about the death of someone's mother caused gmail to put an ad in the sidebar about grief counseling in his city.
People accept google's targeted ads because the info isn't passed back to advertisers; the system shows a relevant ad based on text and then (as far as I know) forgets it. If Facebook eventually works the same way, I think objections will subside.