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The Online Privacy Lie Is Unraveling
Posted Jun 6, 2015 by Natasha Lomas (@riptari)
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[8100415782_1e4870e67d_h.jpg?w=738]
A new report into U.S. consumers’ attitude to the collection of
personal data has highlighted the disconnect between commercial
claims that web users are happy to trade privacy in exchange for
‘benefits’ like discounts. On the contrary, it asserts that a large
majority of web users are not at all happy, but rather feel powerless
to stop their data being harvested and used by marketers.
The report authors’ argue it’s this sense of resignation that is
resulting in data tradeoffs taking place — rather than consumers
performing careful cost-benefit analysis to weigh up the pros and cons
of giving up their data (as marketers try to claim). They also
found that where consumers were most informed about marketing practices
they were also more likely to be resigned to not being able to do
anything to prevent their data being harvested.
“Rather than feeling able to make choices, Americans believe it is
futile to manage what companies can learn about them. Our study reveals
that more than half do not want to lose control over their information
but also believe this loss of control has already happened,” the
authors write.
Americans believe it is futile to manage what companies can learn
about them.
“By misrepresenting the American people and championing the tradeoff
argument, marketers give policymakers false justifications for allowing
the collection and use of all kinds of consumer data often in ways that
the public find objectionable. Moreover, the futility we found,
combined with a broad public fear about what companies can do with the
data, portends serious difficulties not just for individuals but also —
over time — for the institution of consumer commerce.”
“It is not difficult to predict widespread social tensions, and
concerns about democratic access to the marketplace, if
Americans continue to be resigned to a lack of control over how, when,
and what marketers learn about them,” they add.
The report, entitled The Tradeoff Fallacy: How marketers are
misrepresenting American consumers and opening them up to
exploitation, is authored by three academics from the University of
Pennsylvania, and is based on a representative national cell phone and
wireline phone survey of more than 1,500 Americans age 18 and older who
use the internet or email “at least occasionally”.
Key findings on American consumers include that —
* 91% disagree (77% of them strongly) that “If companies give me a
discount, it is a fair exchange for them to collect information
about me without my knowing”
* 71% disagree (53% of them strongly) that “It’s fair for an online
or physical store to monitor what I’m doing online when I’m there,
in exchange for letting me use the store’s wireless internet, or
Wi-Fi, without charge.”
* 55% disagree (38% of them strongly) that “It’s okay if a store
where I shop uses information it has about me to create a picture
of me that improves the services they provide for me.”
The authors go on to note that “only about 4% agree or agree strongly”
with all three of the above propositions. And even with a broader
definition of “a belief in tradeoffs” they found just a fifth (21%)
were comfortably accepting of the idea. So the survey found very much
a minority of consumers are happy with current data tradeoffs.
The report also flags up that large numbers (often a majority) of U.S.
consumers are unaware of how their purchase and usage data can be sold
on or shared with third parties without their permission or knowledge —
in many instances falsely believing they have greater data protection
rights than they are in fact afforded by law.
Examples the report notes include —
* 49% of American adults who use the Internet believe (incorrectly)
that by law a supermarket must obtain a person’s permission before
selling information about that person’s food purchases to
other companies.
* 69% do not know that a pharmacy does not legally need a person’s
permission to sell information about the over-the-counter drugs
that person buys.
* 65% do not know that the statement “When a website has a privacy
policy, it means the site will not share my information with other
websites and companies without my permission” is false.
* 55% do not know it is legal for an online store to charge different
people different prices at the same time of day.
* 62% do not know that price-comparison sites like Expedia or Orbitz
are not legally required to include the lowest travel prices.
Data-mining in the spotlight
One thing is clear: the great lie about online privacy is unraveling.
The obfuscated commercial collection of vast amounts of personal data
in exchange for ‘free’ services is gradually being revealed for what it
is: a heist of unprecedented scale. Behind the bland, intellectually
dishonest facade that claims there’s ‘nothing to see here’ gigantic
data-mining apparatus have been manoeuvered into place, atop vast
mountains of stolen personal data.
Stolen because it has never been made clear to consumers what is being
taken, and how that information is being used. How can you consent to
something you don’t know or understand? Informed consent requires
transparency and an ability to control what happens. Both of which
are systematically undermined by companies whose business models
require that vast amounts of personal data be shoveled ceaselessly
into their engines.
This is why regulators are increasingly focusing attention on the likes
of Google and Facebook. And why companies with different business
models, such as hardware maker Apple, are joining the chorus of
condemnation. Cloud-based technology companies large and small have
exploited and encouraged consumer ignorance, concealing their
data-mining algorithms and processes inside proprietary black boxes
labeled ‘commercially confidential’. The larger entities spend big
on pumping out a steady stream of marketing misdirection — distracting
their users with shiny new things, or proffering up hollow reassurances
about how they don’t sell your personal data.
Make no mistake: this is equivocation. Google sells access to
its surveillance intelligence on who users are via its ad-targeting
apparatus — so it doesn’t need to sell actual data. Its intelligence on
web users’ habits and routines and likes and dislikes is far more
lucrative than handing over the digits of anyone’s phone number. (The
company is also moving in the direction of becoming an online
marketplace in its own right — by adding a buy button directly to
mobile search results. So it’s intending to capture, process and
convert more transactions itself — directly
choreographing users’ commercial activity.)
These platforms also work to instill a feeling of impotence in users in
various subtle ways, burying privacy settings within labyrinthine
submenus. And technical information in unreadable terms and conditions.
Doing everything they can to fog rather than fess up to the reality of
the gigantic tradeoff lurking in the background. Yet slowly, but
slowly this sophisticated surveillance apparatus is being dragged into
the light.
The privacy costs involved for consumers who pay for ‘free’ services by
consenting to invasive surveillance of what they say, where they go,
who they know, what they like, what they watch, what they buy, have
never been made clear by the companies involved in big data mining. But
costs are becoming more apparent, as glimpses of the extent of
commercial tracking activities leak out.
And as more questions are asked the discrepancy between the claim that
there’s ‘nothing to see here’ vs the reality of sleepless surveillance
apparatus peering over your shoulder, logging your pulse rate, reading
your messages, noting what you look at, for how long and what you do
next — and doing so to optimize the lifting of money out of your wallet
— then the true consumer cost of ‘free’ becomes more visible than it
has ever been.
The tradeoff lie is unraveling, as the scale and implications of the
data heist are starting to be processed. One clear tipping point here
is NSA whistleblower Edward Snowden who, two years ago, risked life
and liberty to reveal how the U.S. government (and many other
governments) were involved in a massive, illegal logging of citizens’
digital communications. The documents he released also showed how
commercial technology platforms had been appropriated and drawn into
this secretive state surveillance complex. Once governments were
implicated, it was only a matter of time before the big Internet
platforms, with their mirror data-capturing apparatus, would
face questions.
Snowden’s revelations have had various reforming political implications
for surveillance in the U.S. and Europe. Tech companies have also been
forced to take public stances — either to loudly defend user privacy,
or be implicated by silence and inaction.
Another catalyst for increasing privacy concerns is the Internet of
Things. A physical network of connected objects blinking and pinging
notifications is itself a partial reveal of the extent of the digital
surveillance apparatus that has been developed behind commercially
closed doors. Modern consumer electronics are hermetically sealed black
boxes engineered to conceal complexity. But the complexities of hooking
all these ‘smart’ sensornet objects together, and placing so many
data-sucking tentacles on display, in increasingly personal places (the
home, the body) — starts to make surveillance infrastructure and its
implications uncomfortably visible.
Plus this time it’s manifestly personal. It’s in your home and on your
person — which adds to a growing feeling of being creeped out and spied
upon. And as more and more studies highlight consumer concern about how
personal data is being harvested and processed, regulators are also
taking notice — and turning up the heat.
One response to growing consumer concerns about personal data came this
week with Google launching a centralized dashboard for users to access
(some) privacy settings. It’s far from perfect, and contains plentiful
misdirection about the company’s motives, but it’s telling that this
ad-fueled behemoth feels the need to be more pro-active in its
presentation of its attitude and approach to user privacy.
Radical transparency
The Tradeoff report authors include a section at the end
with suggestions for improving transparency around marketing processes,
calling for “initiatives that will give members of the public the right
and ability to learn what companies know about them, how they profile
them, and what data lead to what personalized offers” — and for getting
consumers “excited about using that right and ability”.
Among their suggestions to boost transparency and corporate openness
are —
* Public interest organizations and government agencies developing
clear definitions of transparency that reflect consumer concerns,
and then systematically calling out companies regarding how well or
badly they are doing based on these values, in order to help
consumers ‘vote with their wallets’
* Activities to “dissect and report on the implications of privacy
policies” — perhaps aided by crowdsourced initiatives — so that
complex legalize is interpreted and implications explained for a
consumer audience, again allowing for good practice to be praised
(and vice versa)
* Advocating for consumers to gain access to the personal profiles
companies create on them in order for them to understand how
their data is being used
“As long as the algorithms companies implement to analyze and predict
the future behaviors of individuals are hidden from public view, the
potential for unwanted marketer exploitation of individuals’ data
remains high. We therefore ought to consider it an individual’s right
to access the profiles and scores companies use to create
every personalized message and discount the individual receives,” the
report adds.
“Companies will push back that giving out this information will expose
trade secrets. We argue there are ways to carry this out while keeping
their trade secrets intact.”
They’re not the only ones calling for algorithms to be pulled into view
either — back in April the French Senate backed calls for Google to
reveal the workings of its search ranking algorithms. In that instance
the focus is commercial competition to ensure a level playing field,
rather than user privacy per se, but it’s clear that more questions are
being asked about the power of proprietary algorithms and the hidden
hierarchies they create.
Startups should absolutely see the debunking of the myth that consumers
are happy to trade privacy for free services as a fresh opportunity for
disruption — to build services that stand out because they aren’t
predicated on the assumption that consumers can and should be tricked
into handing over data and having their privacy undermined on the sly.
Services that stand upon a futureproofed foundation where operational
transparency inculcates user trust — setting these businesses up for
bona fide data exchanges, rather than shadowy tradeoffs.
Featured Image: Marjan Lazarevski/Flickr UNDER A CC BY-ND 2.0 LICENSE
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