Upcoming changes to Facebook’s privacy policies and practices will impact more than just the Facebook community. What the agreement means for other social networks, business marketing practices and people who don’t have a Facebook account.

If having an affect on 250 million users around the world weren’t enough, upcoming changes to Facebook Inc.’s privacy policies and practices are likely to spawn a chain reaction among all the other major social media sites, impact business marketing practices and address everyone who doesn't have a Facebook account.

In a press conference from the Office of the Privacy Commissioner of Canada (OPC) announcing that an agreement with Facebook had been reached, Privacy Commissioner Jennifer Stoddart thanked the company for its cooperation throughout the 14-month investigation.

“I am very pleased to be able to tell you that – following further discussions with Facebook – the company has now agreed to make several changes which address the issues uncovered during our investigation,” said Stoddart.

Facebook’s plans to adapt its privacy policies and practices to comply with Canadian federal privacy law are scheduled to take place over the next 12 months. “With these changes, Facebook could show other online companies that you can have an incredibly successful online company that’s responsible and respectful of privacy rights," said Stoddart.

The question-and-answer period that followed revealed another major social networking site may already be following suit. “I’m very happy to say that another major networking site has also contacted us and will be coming to our office to be meeting very soon to discuss compliance with Canadian law,” said Stoddart.

Facebook expects to set an example for other online companies. “We truly feel these improvements to the Facebook platform will bring a new privacy standard to the social Web, the interaction with social applications online and we’re confident our users and developers will see the benefits,” said Dave Morin, senior platform manager, in Facebook’s press conference following the one held by the OPC.

Meeting Canada’s requirements does well to satisfy the requirements of other countries, according to Facebook, as the laws resonate with those of Europe, Australia and New Zealand.

David Young, privacy lawyer and co-chair of the Privacy Law Group at Lang Michener LLP in Toronto, expects Facebook will eventually become the best practice standard for social networking sites globally. Facebook has already been “pushed, nudged and negotiated” along to provide what you could almost call a best practice model, he said.

Young doesn’t criticize the Palo Alto-based company for taking five years to adopt the intended model and believes they made “good faith attempts.” The U.S. doesn’t have a general privacy law, he pointed out. “We have a much deeper and somewhat granular approach to privacy because we have a law that has rules in it,” he said.

But the changes wouldn’t have happened in Canada either if the complaint wasn’t filed by the Canadian Internet Policy and Public Interest Clinic (CIPPIC), Young noted. “The federal Commissioner might investigate of her own volition, but in fact it took a complaint to launch the thing,” he said.

Independent technology industry analyst Carmi Levy expects to see fewer investigations over the long term as a result of the Facebook inquiry. The agreement is a “bellwether event in the evolution of social media,” he said. “I don’t think any provider of social media services like Facebook wants to be put in the position that Facebook has been in for the past number of months. Nobody wants to be on the wrong end of a firing squad."

Levy expects changes from major social media platforms like Twitter, Google, MySpace and Microsoft over the next few months. “[They] will all very concretely and very proactively be addressing their own privacy policy and will be introducing upgrades to their services to make it more transparent and controllable by the end user,” he said.

But the ultimate responsibility will continue to lie with the end users, Levy pointed out. “Companies and employees using these tools need to revisit their acceptable use policies to make sure they are reflecting that,” he suggested.

Tim Hickernell, lead analyst at Info-Tech Research Group Ltd., advises organizations not to jump the gun as the model may not be good for business. “I would wait to see what actually gets implemented by Facebook and that will likely be a final round of approval by the government. As a business leveraging public social networking, I would not make any strategy changes yet and would continue to follow all existing marketing laws and best practices,” he said.