I don't get it.. so anyone with the priv.ly extension installed can view the content? Priv.ly is also open source?

So.. if say 10% of Facebook users started using Priv.ly.. wouldn't Facebook just put their own implementation directly into their site? This would give Facebook access to your content as well as make your content available in the Facebook mobile app's.

Sure, it abstracts away your content but if it can be viewed anonymously it doesn't protect it or prevent twitter etc from reading it.