Essentially what happened is "LifeLog" was designed to covertly gather information without people's knowledge, then along comes MySpace and the birth of social netowrking and the government spooks realized for the first time that people would happily share their own personal information with a faceless organization as long as it was dressed up as a nice way to talk with friends. Bonus points when they realizes peer/media pressure might cause it to expand exponentially.

And THAT is when Facebook was born.