Because internet.org's proxy server gives Facebook monopsonic control over the internet.

Even ignoring the massive man-in-the-middle attack problems from running old phones on a proxy, Facebook is positioning themselves to control exclusive access to large number of users for websites.

You could argue that Google already does this - but Google has competitors that users could switch to in a heartbeat. Internet.org users don't have options, and websites need to pander to Facebook to be in that walled garden. It also makes it easier for third world countries to censor the internet.

In the end, this is damaging to the open internet ecosystem. Facebook could have just implemented a rate-limited or data capped system like other ISPs, but they opted to create a more restrictive system that gives them more power.