Facebook's CEO, Mark Zuckerberg, later apologized for the service overstepping its users' privacy. He offered users an opt-out function on their profiles from such advertising methods, and months later took steps to allow people to control their privacy with greater specificity than before.

But that's just Facebook. The number of social networks and other Web-based communities to track is nearly impossible for a person to do on his own.

The idea of creating a tool to manage your identity across the Web is nothing new. claimID, for instance, provides users with a free service to keep a link resume - a list of approved sites that the user verifies they actually engage in or manage.

Larry Ponemon, founder of the Ponemon Institute, a privacy and business ethics think tank, says that while it's encouraging to see the technology industry take an active interest in the issue, the allocated amount of money might not be enough to really address the problem fully. "A small consortium of organizations with a budget of 10 million Euros appears to me as too little too late," he says.

But Ponemon emphasizes that he likes how the service will track users over their entire lifetime, not just for a brief snapshot in time. "It pursues a life-cycle approach for managing privacy by individuals," he says. "In my opinion, promoting individual responsibility and accountability with enabling technologies is real genius."