Popular social networking site Facebook is launching a new type of mobile advertising that targets consumers, according to what apps they use, giving companies better options to track what people do on their phones. Facebook is tracking apps through its popular Facebook Connect, which lets users log into websites and apps, as varied as Amazon.com and LinkedIn with their Facebook accounts. The company then uses that data to target ads, said people familiar with the company’s plans. Facebook may also track what users do on the apps, but that is yet to be decided by the company.

The new ads raise questions about privacy because Facebook is going a step further than mobile-ad networks, which track what ads people have clicked through on a phone’s Internet browser. These new mobile ads could potentially be highly lucrative for Facebook. They can charge advertisers every time an app is installed on a smartphone, one of the people familiar with the plans said. Facebook can charge significantly more for an app installation than it can for the traditional cost of every one thousand people who viewed an ad.

Big companies, like Apple and Google track user’s mobile apps, but they approach the targetting differently. Apple discloses in its privacy policy that it can target ads based on apps that the person has downloaded from the App Store and iTunes. Google doesn’t target ads based on data, though they theoretically could. Neither Google nor Apple track what people do in apps for ads. The ads, scheduled to be announced next month, will show up on mobile devices in Facebook’s news feed.

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An example of what a typical scenario could be like with the new ads, would be if someone plays a lot of Zynga’s “Words with Friends” game, ads for other Zynga games, like “Scramble with Friends” or “Farmville” would appear in that user’s news feed on their phone.

The new advertising is a departure for Facebook on many fronts. Up until now, the company has only pushed ads to people, if they have effectively allowed permission to see the ads because they have “liked” a brand or company on the website. With the new ads, Facebook will target ads without permission. Privacy advocates suggest Facebook should provide a way to opt out of the new ad targeting.

Director of the Center for Democracy and Technology Justin Brookman said Facebook would ideally allow people to log in via Facebook Connect and then not track what they do. But, “if they are going to do it, they should be transparent about it,” Brookman said. “Once you’re signed in, are you really expecting that Facebook is going to be watching you while you’re on there?

This may be a move by Facebook presumably in an attempt to ramp up its revenue, especially through mobile devices after the company went public in May, amidst much hype.

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