Internet privacy is a fallacy. This is a public place, but I think many people have trouble understanding the concept that while they're physically sitting in the privacy of their own homes, they are virtually putting themselves out there, amidst millions of others, like visiting a sort of global shopping mall.
This isn't to say you can't wear a disguise, or try to hide in virtual dark corners and alleyways, but just like doing so literally, it still isn't private. A part of you is out there, in digital form, in the digital open world. This means some of the expectations we have of privacy are a bit silly, and some of that paranoia about it being breached is a bit misguided.
This is not something anyone is doing to us, not the government, nor corporations - they may use the data trails we leave everywhere, but it's really not so different than the way they use real world data, in the ways we're more familiar with. From which shopping sales we take advantage of, to the fingerprints we leave behind. A lot of it is being used academically, as well. It's all just out there, as a natural result of how the internet works, and it only makes sense that people try to make use of it.
Now, if there were any evidence that we were being watched too closely, too specifically, sure, that could be scary - but much the same way it would be, if we found out they were tracking our physical world behavior too closely. Being stalked, audited, stopped and frisked, etc. We do have places like Facebook, that blur the lines, where they ambiguously give and take privacy, but it's like a restaurant, where diners don't seem to realize that they're patrons of a privately owned business. Where one person's breach of privacy can be just the exposure another person wants out of being there.
I think maybe the problem lies more in the common understanding of what sort of place this is, and really, what sorts of places we go, all over the internet. Which places are public, which are businesses, and where we draw the line between that and our presence there ..and I'm not sure some people even understand what the internet itself really is, and what it means, just to be logging into it.