A little bit of sensationalism going on here, while they obviously did a very poor job at communicating it doesn't point to a lack of caring about users. It does point to a failure to communicate, something I am not surprised of from a young company, especially one currently sealing a funding round.

I'm not so sure. As far as I can see, they've still only fixed 1 of 3 security holes - which violate their own privacy policy - and yet have found the time to both push this funding through (not a small effort) and highly publicize it. Should they not be worrying more about their users' privacy than their PR? I know that these are different 'roles' in the company, so it's not as simple as pulling people off one thing and on to another, but it does feel a little slimy.

Most interesting part of the story for me was:

"Wired.com also asked the prominent angel investor Chris Dixon by Twitter..."

Is this a customary practice for journalists now?

No, but that's the only contact info listed for Dixon on his homepage or on Hunch. I say this as the author of the article.

I thought they put alcohol before privacy? Maybe that was before money. After Google?

Is this really all that surprising to anyone? I wouldn't trust any of these location services...even google Latitude. My location is just something way to central to my privacy, and my safety, to be left to a company like this. Money, emails, whatever else that can be stolen on the internet can be recovered. But not my privacy.