A lot of businesses on the Web seek control - for instance, the otherwise awesome Instructables, which normally gives you a sequence of steps in a how-to article. If you want to see every step at the same time, you get an idiotic and insulting pop-up:
As far as I can tell the only reason to see every step at the same time is to eliminate the tiresome busywork of clicking "next" a dozen times - in other words, to save time. If I take an action to save time, and you tell me the only way I can do that is by starting a whole separate task of user-registration busywork, so I can have a login I'll never use again in my life, and another password I won't remember - or more accurately, for most users, another place where the same password I use for my bank account will be stored, possibly in thief-friendly plaintext format - then I'm not going to be happy.
I'm not going to do it, either. Instead I'll give your Web site the finger and post it a rant about it a few days later when I'm feeling particularly grumpy, and I'll put the words "jackass bullshit" in a filename along with the name of your Web site, which means that if users google "instructables jackass bullshit" in Google Images a few days or hours or minutes after the blog post, they'll see exactly what I'm talking about.
You can't buy that kind of publicity.
ThinkGeek lost some business from me this way in October. I order a few hacker toys from ThinkGeek once every two or three years - usually at the holidays, usually for my dad, who, despite his years, has a real appreciation for USB-powered dart guns. I order from ThinkGeek frequently enough to have an order history, complete with redeemable geek points. In fact I recently got a free USB plasma ball with my geek points. That's cool. But I also order from ThinkGeek infrequently enough that practically every time I order anything from these guys, I have to have them e-mail my password to whatever my e-mail address was two or three years ago, and then see if I can still log in to that to retrieve my old ThinkGeek password. It's time-wasting bullshit, and in October it cost ThinkGeek money. It may have cost them money other times that I don't know about.
It's awesome. Buy it from ThinkGeek, if you have the patience.
Meanwhile, a site called Topix found that "registration keeps out good posters and attracts trolls." Removing the registration requirement on their forums improved the signal-to-noise ratio and dramatically increased the volume of posts. And a programmer who built a zero-registration free dating site to teach himself ASP.NET made $10 million with it in 2007. People like to skip registration, because it's an insulting waste of time. It's like when Radio Shack asks you your phone number before they'll sell you AA batteries.
Here you go, sir. Now all I need is a sample of your DNA. Please give me one of the hairs on your balls.
What's funny about this is that technology companies are making the same mistake they have laughed at entertainment companies for making every time entertainment tries to "embrace" new technology - overemphasizing control at the expense of profitability.
Overemphasizing control at the expense of profitability is insane for companies to do, yet companies are doing it all the time. For whatever reason, the culture of business makes certain assumptions about your relationship to your customers which just aren't true. You don't need control. It's bad for your business. Attempts at obtaining it fail, costing you money in the process. When you give up control, you make more money.
Always favor respecting privacy over asserting control. It's not just good usability. It's not just the right thing to do. It's not just a good business decision. It's all of the above.
Update: Control is a business disadvantage because one size does not fit all. Saying "they can have any color they want, as long as it's black" is perfectly okay as long as they can always go out and buy a can of paint and a brush.