Linden Lab, the makers of virtual world Second Life announced to their customers that its database, which includes customer names, addresses, passwords and credit card information had been hacked.

While Linden Lab’s CTO Cory Ondrejka advised users to “change their Second Life passwords immediately,” this security breach occurs after a string of events in the last week that have brought up the issue of privacy. Facebook’s Mark Zuckerberg issued an apology to Facebook users after a week of protests regarding a new feature that perhaps exposed to much information to other users about a person’s decision to make changes to their profile. Jason Fortuny’s prank of posing as a woman on Craiglist, and then posting the photos and identifying information points to the fact that people are far too open in sharing their personal information with complete strangers online.

Regardless, more privacy tools are needed online — and fast. Tools like Google Checkout, eBay’s PayPal, Bill Me Later and other alternatives to credit card payments have already made people more comfortable about shopping online. People may also want think twice before sharing their profiles, photos, email addresses and other sensitive data with others who they do not already have an established, trusted relationship.

With Microsoft’s recent purchase of Massive, lots of corporate sponsors are jumping into in-game advertising as a way to reach the younger demographic that is watching less and less TV. The problem is trying to figure out how to do it in a way where it makes sense and doesn’t offend the gamer. While many advertising agencies are scrambling to throw corporate dollars for product placement within existing games, game advertising company Play, a unit of Publicis’ new media consultancy, Denuo, is taking a slightly different approach.

First, as creators of Miller Beer Run, Play focused on creating an advergame that was specific to Miller Beer, but also paid homage to the TV spot created by Y&R taking an interesting storytelling approach where the narrative was played across multiple media platforms. Second, instead of hosting the game on Miller’s corporate website, Play worked with Yahoo and MSN to release the game on their game-specific portals, with the logic that the game would have a greater reach on those portals, rather than attempting to funnel visitors to Miller’s website via banner advertising. The result was successful from Play’s POV — with over 3MM game plays and 1.2MM unique players.