Why Privacy First Products will make business sense
Jules van den Berg
"In order to safe-guard your personal freedom, it is required that you have control over your personal information." I believe privacy is a right which is disappearing to leave room to convenience as they say it. Within the last years it became obvious that consumer data is increasingly collected, stored and processed for online as well as offline purposes.
Note: this guest post is a re-post of 2015, but it is still very relevant today.
"In order to safe-guard your personal freedom, it is required that you have control over your personal information." Walter Leibbrandt, CSIR
I believe privacy is a right which is disappearing to leave room to convenience as they say it. Within the last years it became obvious that consumer data is increasingly collected, stored and processed for online as well as offline purposes.
You probably witnessed it yourself.
Walking into the branch of your mobile operator to change plans, and receiving an offer for a new phone. This is not unusual. But is that phone not the exact one you looked at several times on the operator's website while being logged in?
Another simple test on privacy is looking at prices for flight tickets. Do you own an Apple device? Congratulations, you will receive higher prices for flights and hotels. Sometimes even if you look at a flight too many times, as your interest is qualified as higher. In the world of flight ticketing, everyone is used to price changes frequently so usually we do not consider this a privacy issue rather than an offer/demand issue.
I believe privacy should be protected, not for the sake of cheaper flight tickets, but from a "safe-guarding" personal freedom and choice. I don't know what I don't know, and online systems can get to the point where news delivery is profiled. I don't mind not finding a hotel that is far better and 20$ cheaper, but in its core this is access to information I am being denied.
I believe there are businesses that need or should have personal identifiable information about an internet users. Banks or Government need the basic of these information to operate for example. Do they collect too much sometimes? Yes, but from the two I know banks at least have good security and privacy systems to protect my identity. I doubt Google, Facebook or Target should have this information in the first place.
There are more sides to privacy: security of data, as well as use of personal information. I consider privacy the security of my information, in cases of identity theft for example, as well as what data is collected about me, where and how long is it stored, who is it shared with, how it is used.
For the first part, I make sure I am selective to whom I trust my valuable personal identifiable information (PII), and select companies that have a track record in securing access to information. The second the topic becomes more sensitive.
Privacy invasion is accepted because of convenience. I disagree. It is accepted because of lack of alternatives as well as unawareness. The general opinion is that benefits outweigh the drawbacks and if you have nothing to hide, you should not worry. That is now, but Internet of Everything coupled with Big Data and Cloud, will make data matching and automatic personal information extraction processes the next big thing.
And how about the golden "eye-balls" era of web and mobile products? The business model is based on user adoption, data collection, and data processing for a future promise of brand awareness advertisement, selling aggregated statistics, targeted & personalized advertisement, or upselling additional services.
As consumers, do we really need the convenience of a retailer forecasting and predicting before we do that our wife will be pregnant for example?
Privacy awareness is rising among internet users. In 2013 more than 86% of the internet users made steps towards removing some of the personal information available online due to privacy concerns.
Kevin Abosch, founder of KwikDesk projected the need of a new service: Human Rights as a Service, and the start of Privacy First Products as a movement to support it.
Privacy First Products
I believe Privacy First Products (PFP) have a chance of even making business sense in the consumer business, not only in a B2B scenario. The value for consumers can be built around one or more of the following pillars.
Reduce financial risk and identity theft risk
6% of the users lost money due to online fraud activities, and 11% had important personal identifiable information stolen. In a PFP product such information would not exist but even more, it would be almost impossible for scammers to segment and target users with phishing or social engineering attacks.
Offer true privacy and peace of mind
12% of internet users have been stalked or harassed online. PFP products could see the end of stalking and harassment as following users across PFP platforms would be too cumbersome to pursue.
Different social interactions
1% of internet users have lost a job opportunity or educational opportunity because of something they posted online or someone posted about them. 6% have had their reputation damaged because of something that happened online.
We should encourage people to become anonymous and not take responsibility. PFP products would allow users to control and truly remove if needed "features" as social tagging, and the sharing of personal related data by others (most common is photos).
Better user experience
"22.7% of web surfers are blocking ads, and use of ad blocking is growing." (PageFair)
PFP would be advertisement free, or at worst no targeted advertisement. As a simple example here for the added value, think of the following (exaggerated but true) example: Today, anyone can target anyone at individual level with social ads.
The innovative business model on PFP
The logical question is how could companies fill in the gap of advertising and Big Data revenue, and still be sustainable and profitable?
I doubt this question to be real. Have we really forgotten the traditional models and is the internet so "new model generation" frenzy that charging users for a privacy enabled service would not make sense?
The market for privacy concerned digital citizens exists. Services like RunBox show that it can be monetized and that users are willing to pay to ensure their data remains private against black hat hackers and internet companies.
To take it one step further, using digital currencies like Bitcoin would ensure the service is charging using as little PII as possible, I would even go there and say using a payment systems where the authentication is done at bank level as iDEAL and MyBank would provide better privacy than wallets and cards. They already have secure systems and have your data. Why share it with a third party?
Abine is monetizing two products in terms of privacy: Blur and DeleteMe. Both have a direct subscription model, and Blur even has a freemium touch. WhisperSystem is a non-commercial organization, based on the open source movement. For basic users they offer the community apps, free to use. But in the future this system can be monetized just like other open source solutions at enterprise level.
The basic need of a PFP business model is centering the product on the needs of, and ensuring it delivers value to, the user not third parties.
Can't we build user centric products anymore? And why not make them privacy enabled?
Statistical Data from Pew Research in 2013.