New concerns about user privacy are being raised after a report surfaced that Facebook plans to eventually target consumers based on which apps they use.

The Wall Street Journal reported that Facebook’s new initiative in mobile advertising will push “the limits of how companies track what people do on their phones.”

“Presumably, people want to be able to browse the Web without having someone watching their every move,” commented TechZone360’s Oliver VanDervoort.

Under the reported approach, Facebook will track apps employed by users via the Facebook Connect feature, which lets users log into websites and apps via Facebook identities. Knowing that data, Facebook will then target ads, The Journal said.  

Facebook can also try to track what users do while using the apps.

With the new ads, Facebook goes beyond mobile-ad networks, which only track the ads users clicked on via a Web browser on a phone, according to WSJ.

One example is someone who plays Zynga's "Words with Friends" – and will be targeted with ads for more Zynga games, according to a report from Naked Security.

In contrast, Apple can now target ads based on apps which users download from the App Store and iTunes. Neither Google nor Apple now track what users do in apps to target ads, according to news reports.

With privacy concerns, Facebook is being urged to offer methods to opt out of the mobile ad targeting, WSK said. Justin Brookman, director of the Center for Democracy and Technology's project on consumer privacy, said Facebook should let users log in via Facebook Connect and not track what the users do, or if they do the company should be transparent.

In addition, Facebook would likely charge advertisers every time an app is installed on a users' smartphone. The social media site would charge more for an app installation than for the number of viewers who looked at an ad.

The new method is a way for Facebook to increase revenue via mobile devices – after its disappointed IPO in May.

“Mobile revenue has been a sore spot for the company for months,” reported GigaOM. “While Twitter has had success with its native mobile advertising (even reporting that mobile revenue outpaces desktop revenue), Facebook has been slower to make money from the 500 million users who access the social network from a phone…Facebook has little choice but to be as aggressive as it can be.”

U.S. mobile ad spending will increase some 80 percent to $2.61 billion during 2012, GigaOM added.

Facebook may begin to offer the new mobile ad product later this month, The Journal said.