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It's scary that something like this does (and no doubt will) happen. As the saying goes: always follow the money.

What other companies do this?

I think you'd be surprised - these types of tactics seem to be the rule and not the exception these days based on the way that these sites are set up.
I'm surprised this doesn't bother more people. Especially because facebook, etc. are so open about their policies. Holiday claims this will make Facebook go by the way of Myspace, but I'm not as sure. I think too many people are too invested.