Meshing digital for cash
- Summary:
- Being able to make use of people’s personal information is intrinsic to most visions of a digital future. But are consumers really getting their money’s worth?
Take market researcher Gartner’s forecasts around the emergence of a world based on a so-called “digital mesh” or digital ecosystem, the foundations of which are already in place today. This concept is built on the idea of everyone being surrounded by lots of devices – or “device meshes” - whether at home, at work or in their car.
These devices, which all have their own IP address and include everything from wearable technology to machine-to-machine-enabled fridges connected to the Internet of Things, will each be equipped with sensors – 30 billion of them by 2020 apparently.
The sensors will in turn, transmit data - dubbed “Information of Everything” - about us, our movements (via geo-location software), our health and our shopping habits to artificial intelligence (AI) systems to analyse. Mike Walker, a research director at Gartner, explains:
To move from being a bunch of things out there talking and not providing much meaning, we need systems such as deep learning and artificial intelligence to provide intelligent insight. All of the sensors are picking up data, but in order to create new and compelling experiences, it needs to be combined with information about your personal context.
Such personal context will, for instance, enable the system to distinguish whether you as an individual are undertaking regular exercise or whether you are simply running for a bus as a one-off.
But ultimately the idea is that organisations will take this personal and contextual information, aggregate it and analyse it to help them create amazing new products, services, and even companies. Walker says:
It’s about moving from a deterministic to a probabilistic approach, where you ask question A to get answer B, but the engine tells you to think about C, which could lead to the creation of something entirely new. So to create compelling experiences, it’s all about insights.
But this vision of the future is, of course, entirely predicated on personal data and whether people are willing to part with it. It also raises the issue of what such data is actually worth and whether people are getting a fair exchange when companies are making significant amounts of money on the back of it.
Richard Hollis, director of information security consultancy the Risk Factory, thinks not. He says:
Data equals cash and all data has intrinsic value whether it’s about your credit card or shopping habits. From a privacy standpoint, there are two types of data that we give up – one is passive data, for example, geo-location information, where my phone tracks me as I walk down the street. The other is covered by data protection legislation such as my medical records. People understand that information such as their blood type might have a value, although they’re not sure to whom. But they don’t understand that passive data also has an intrinsic value and that companies are making millions of dollars from it.
While there is as yet no formal mechanism to calculate what personal data is worth, one rough means of doing so, for information covered by legislation at least, is to go onto hacker marketplaces and see its value on the open black market. So 10 years ago, for instance, credit card information was worth £50 ($74.50) per data set.
But due to the huge number of security breaches at high profile organisations over recent years, including the theft of more than 21 million personnel records from the US government’s Office of Personnel Management in the summer, this figure has now plummeted to a mere 10 pence ($0.67 cents).
A survey of 5,000 UK consumers by digital storage company Western Digital, on the other hand, found that the average consumer felt that such data was worth more like £3,241 ($4,830).
Whatever its value, however, Hollis believes that most consumers are more than happy to “trade privacy for convenience”. He explains:
Passive personal data is like a currency that we can’t cash in. But when you line things up against big data and AI, your privacy is gone. So information about the shampoo I use is monetised and bought and sold without my permission. We’re talking about a lot of money, but we haven’t objected to the situation so far so how do you go about pulling that money back? You can’t – it’s too late. Once a carnivore gets a taste of blood, you can’t turn it back to being a vegetarian.
Data equals cash
But the core issue is that the “commercial world now owns our personal data”. Hollis continues:
We were all worried about governments, but we’ve drifted into this situation as data equals cash and it’s become a commodity. We were worried about Big Brother, but it turned out to be commercial companies that we should have been worrying about. So we were defending the wrong front.
But he believes that a tipping point will come, leading to some kind of action. This scenario is likely to occur once organisations start packaging up people’s personal data in order to try and sell it back to them, a scenario Hollis feels is inevitable.
But Tim Watson, director of the Cyber Security Centre at the University of Warwick, is not so sure. He believes that, although some products and services do not act as a good trade-off for valuable personal data, others are mutually beneficial.
Moreover, he reckons that while many people are happy to part with their personal data often without thinking about it, others are beginning to “wake up” and want to take control.
To this end, he points to the little-known vendor relationship management initiative. This is the brainchild of Harvard University’s Doc Searls and is intended to flip the idea of customer relationship management on its head. The goal is to give people rights over what happens to their information, and also to manage who has access to it and under what circumstances.
The University of Warwick is currently running a development project called the hubofallthings.com based on such ideas and has just moved its HAT platform into alpha testing stage.
Another organisation working in the field is UK start-up CitizenMe. It’s working on a mobile phone app, which is due to launch next March, that can pull all of your personal digital footprint information into one place.
The firm is also offering to hook people up with market research organisations to anonymously share pre-defined information in return for cash plus a copy of the data handed over. Over time if users so desire, CitizenMe will also analyse such information to provide personal insights into their personality and how they compare with others. Founder and chief executive Stjohn Deakins concludes:
There’s increasingly large amounts of data about individuals starting to reside on unknown and third party databases, and there are huge risks involved if they don’t have personal agency or control over the visibility of that data. People have to be able to make choices because if not there are just too many dystopian possibilities.
My Take
Finding ways to give people more control over their own personal data and what they do with it has to be a positive thing – even if not everyone is aware how and why they might benefit from it as yet. But as such information becomes an increasingly valuable commodity, initiatives such as vendor relationship management, which started as long ago as 2006, may well finally find their niche.