In today’s society, most Australians are pretty comfortable with sharing personal information, with at least one major caveat – that we clearly know what our information is being used for.
Understanding how the information that organisations collect from us is used is the key guiding principle of our Privacy laws. Our privacy regime is consent-based – if you understand why private and personal information is being collected and consent to the purpose for which it is being collected then that information can be used for that purpose.
Social media and the more successful Internet business models fundamentally challenge this notion – because commercial success is often predicated on knowing as much as you can about your individual users and being less than upfront about how that information will be used.
However, this lack of transparency may start to erode confidence in the online environment and ultimately harm the development of the Digital Economy. The last national survey into privacy attitudes undertaken by the Office of the Privacy Commissioner in 2007 found that it may have already been having an impact.
Fifty percent of respondents were more concerned about providing information over the Internet than they had been when the previous survey was undertaken in 2004.
Many online services (like social media) can appear to be an altruistic public service – a way to find and share information, communicate and collaborate with friends. This view is supported by the sector. The less visible the business model - which in most instances is essentially monetising your personal information – the less concerned you are providing this information in the first place.
But will this lack of transparency start to undermine the future success of the Digital Economy?
Many online players fear that the more you know about their business models, the less likely you are to part with your valuable information.
Facebook has been the subject of some pretty heavy scrutiny of recent and has taken some steps to improve the controls around your private information.
At the end of the day, you ultimately control what information you put on your profile on Facebook, it’s very visible to you and those concerned about how it might be used can publish less about themselves.
Google however, is a different beast. Google has slowly built a business by profiling the online habits of the world’s population unbeknownst to most. Ads are served to you not just on that specific search term, but your history of searches. Google knows what you’re interested in.
This ability to segment the Internet user community according to their personal interests is a valuable commodity to marketers and advertisers - which is ultimately how Google makes money.
Google’s increasing breadth of offerings only increases the breadth of personal information that it has access to and can combine to profile its users:
• Google’s mobile phone platform, Android, has GPS location-based tracking software built into it which can be used by third party application developers for advertising;
• Nearly 200 million Gmail email accounts that Google automatically scans the text of emails for keywords to serve you targeted advertisements;
• Google Apps require you to sign up for an account, providing information such as your name and email address and potentially credit card data, which Google may combine with information from other Google services or third parties; and
• Google’s Streetview plus the Google Goggles application on Android will allow people to hold a phone camera up to a house and then get information about the location and potentially who lives there.
This is ultimately a clever strategy because for the consumer the majority of these services cost very little or are free. How Google makes money is often fairly invisible to the average consumer.
But there are increasingly questions about how Google uses that data. Google has already demonstrated a willingness to use contact data in Gmail for other purposes without user consent – including pre-populating the Google Buzz and Google Voice applications.
The revelation that cars taking photos for StreetView were also collecting information such as passwords and entire emails from unsecured Wi-Fi connections, demonstrates the increasing hunger that Google has for marketable data.
Reflecting a dismissive tone on these issues, Google CEO Eric Schmidt recently responded to privacy concerns around StreetView by stating: “Street View, we drive exactly once . . . So, you can just move, right?”
Most don’t realise what value they provide in return for using social media or online search, but nothing comes for free.
It’s about time the industry was more upfront and transparent on how it makes money and that your personal information is their valuable commodity. Or don’t they want anyone to know?
Eric Schmidt did also famously say: “If you have something that you don’t want anyone to know, maybe you shouldn’t be doing it in the first place.”
- David Masters is an adviser to the Initiative for a Competitive Online Marketplace (ICOMP) and a former Ministerial adviser on Information Economy issues.
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