Facebook knows who all of your closest friends and family are. When you backpacked across Europe last summer, they went along on the trip. Remember that break up two years ago? Yeah, they were there. The breakfast you ate this morning? They probably have a picture of it. They're even right under your own feet.
Since Facebook already has access to the majority of your life, it only makes sense that they know where you are at all times too, right?
Facebook's Location 'Feature'
When you download Facebook for Android, there's a receiver built into the application that captures your location... more