When I (and all my friends from high school) signed up for Facebook, we were not expecting our lives to become public property. Even my "social graph" is really none of anyone's business.
Sure, there are many examples of people who have viewed FB as totally open, public, broadcast, the more the merrier. The issue is not that it's impossible to do both public and private, the issue is that it's a very muddled message that users get.
A much clearer message would be this: Facebook is private, Twitter is public.
What percentage of usage of the twitter platform is private? What percentage of accounts are private-only? What percentage of tweets are direct messages (DM's)? My guess is way less than 10%. With this data one could come up with a "degree of expectation of privacy" index. [Unfortunately, private accounts, although they may be encountered occasionally, do not seem succeptible to twitter API grazing - that's kinda my point.] Twitter knows.
Meanwhile, if FB users were polled on their "reasonable expectations of [degree of] privacy," my guess is that all those farmtown grandma's, etc. would rank it pretty highly.
It's none of anyone's business that I'm friends with Ben Horowitz, for example. Ok, so that one is ok w/ me to be public knowledge; not sure if it's ok w/ Ben.
On the other hand if I follow Ben on twitter, I do so understanding full well that this will be public information. Heck, I can even follow Ashton Kutcher or Justin Bieber if I want, (and on the former, I do; the latter I have to filter).
Twitter's growth rate is now faster than FB's. In part that's because FB has done such a good job, they're kinda saturated, while Twitter, for many, is still the next big thing. But it's deeper - twitter is simpler, cleaner, and one never has to worry about whether something will be private or public - they can simply assume that everything is public, forever (Library of Congress anyone?).
If someone built a poll for "How private do you expect Facebook|Twitter to be?," my guess is it would be Twitter 90% public, Facebook 90% private.
That's the last thing Mark Zuckerberg wants (and investors in the FB-verse) to hear. Sorry, but FB has painted itself into a privacy-corner.
Facebook competing with Twitter on completely-public data?