Paying the piper for privacy

March 15, 2013

Three privacy stories caught my attention in the past week:

1. Google is paying a token $7 million fine for sniffing out private information as its roving Google Maps cars gathered images for Street View.

2. A new study has found that seemingly innocent disclosures on Facebook can be used to form highly accurate predictions about whether you are a genius, drug user or gay.

3. If you use certain porta-potties at the Austin, Texas, tech confab South By Southwest, passersby know if you are … standing or sitting inside, and for how long.

Is all of that what we signed up for?

Privacy is a huge issue — too huge for a single, brief column. But I’m going to make a prediction. I don’t know when or how it will happen, but before too long there will be a jarring, transformational event that will cause us to question our online behavior. Some horrendous breach of privacy, well within the parameters of some service’s Terms of Service, will spark mainstream outrage and cause companies to scramble with damage control.

It doesn’t have to be that way.

We’ve had plenty of warning. Facebook’s business model is entirely based on members expressing preferences on just about everything – it was in part the volume of information that allowed the researchers to find the correlations I mentioned earlier. Google’s business model is arguably less invasive but is also based on the relinquishment of online privacy to one degree or another.

So far, most people are content with the deal they have struck with nearly every Internet service – or just blithely unaware of it. Even the ubiquitous Web-browser cookies provide sites with information about where you’ve been — and, marketers hope, may want to go. Ever see an ad for something you looked at on one site on another? You haven’t opted out of a Google tracking option.

Google makes it easier than (say) Facebook to trim your online exposure — every Google account has a dashboard that clearly shows all the data associated with it, and simple ways to control it. But the Internet still imposes a growing burden on each of us to do just that. We have been conditioned to expect “free” services, but everything has a cost. It’s become a truism: If you aren’t paying for it, you are the product.

Here’s an idea. Let’s stop with the “free” service nonsense.

When Instagram alienated users last December, The Atlantic‘s Alexis Madrigal made an important point about making money. In a piece headlined “Why You Should Want to Pay for Software, Instagram Edition,” he noted that the company would gross $100 million a year if only 1/5 of its users agreed to pay $5 a month — not a bad revenue stream for a company that sold itself to Facebook for about $700 million — and still needs to make money.

I’m aspiring to change the balance of power and the compact we have with the most important business relationships in our lives. Trying to “reform” Google and Facebook isn’t the point. But how nice would it have been if Google had decided not to kill its Reader RSS service and ask us to pay something for it instead? What would the reaction be if Facebook offered a “premium” service that made it easier not to be seen, but to still see just as well? 

Big changes can come from small initiatives. Culture can be changed just because we want it to change.

So here’s a call for startups, and for the rest of us. 

For entrepreneurs: Avoid doing a deal with the devil. Consider the possibility of — horrors — charging for your service. Try to work with angels and VCs who share your vision and won’t push you to make the big, quick score. Follow the thinking behind 37Signals’ David Heinemeier Hansson, who counsels to find peace and contentment in a life that nets you a few hundred thousand bucks a year. 

For the rest of us: Lobby for paid versions, or premium accounts. Know what you’re getting into, and say “no thanks” every now and then. For years companies like Flickr, Simplenote and XMarks have been suppressing ads or offering premium services for small payments.

We need to reset our relationship with Internet companies, and it won’t happen overnight. But common sense now will avoid — or at least mitigate — the privacy train wreck I’m sure is in our future otherwise.

PHOTO: Google Street View cars are parked in Riga August 26, 2011. REUTERS/Ints Kalnins

4 comments

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privacy has become a popular boogeyman to warn about. unfortunately, the increased attention brings a lot of sloppy thinking.

for instance, has the author read the detailed report on exactly what information Google captured? it’s the stuff you’re already broadcasting in the clear – the stuff you don’t care enough about to encrypt. you might as well just paint this stuff in big letters on the front of your house, taking care to make it visible from the street where a car with a camera just driving by will be sure to see it…

privacy IS an interesting issue, one we need to spend time thinking about. but this kind of article DOES NOT HELP. we need careful, thoughtful, in-depth, researched work on the topic, not journalistic drive-by shootings.

Posted by markhahn | Report as abusive

What needs to happen is that the public needs to stop being so stupid about for-profit corporations and the internet. Such organizations provide nothing for nothing.

The Open Software movement is different. The computer people who expanded and essentially created the “web” are different. The goal there is making the world a better place through doing good. Corporations are in business to make money. If you do not know the difference between the two, you have far too little knowledge of the world to complain. To quote P.T. Barnum, “There is a sucker born every minute!”

Posted by usagadfly | Report as abusive

“It’s become a truism: If you aren’t paying for it, you are the product.”

Only in the Internet world is that true, but that’s because that’s how companies like Facebook and Google exist at all. If they charged users they wouldn’t be Facebook scale or even noticeable at all, and they know it, and also they know their market wouldn’t use them.

If you don’t have a reason to buy the information and can’t justify the subscription as part of your business, or if the service is something you can’t really live without, there isn’t much reason to use most of it.

Television and radio advertising paid for free services in the past and the consumer wasn’t the product. The advertised products and the shows were the product.

Premiums won’t necessarily guard user activity either. They will simply watch fewer subscribers’ activities and try to peddle that data to their advertisers. Newspapers and Magazines were doing that for years. Magazines like the New Yorker sometimes send out user profile questionnaires. They always want to know your yearly income range and your level of education among a lot of other things.

“Paying the piper” will kill off a lot of the pipers.

Posted by paintcan | Report as abusive

The problem is that a fundamental aspect of the whole concept of privacy is: The Assumption of Privacy. Users shouldn’t have to read through long legalese to determine that the service provider starts with an assumption that essentially nothing is private.

The arrogance of these providers adds to the frustration and outright anger on the part of many users.

Most users aren’t aware of or concerned with the problem?! Speak for yourself. Most people I communicate with are very concerned about their security and privacy and often write and speak about it.

One of the reasons why Microsoft’s Passport was an abysmal failure was that most people don’t trust providers to maintain privacy. Oddly, Microsoft was mystified – stating publicly that they couldn’t understand the public’s demand for privacy.

One of the reasons why there haven’t been numerous public outcrys regarding privacy failures is that there is little practical recourse against the humongous providers who wave small-print legalese as protection against class-action lawsuits.

If this big, predicted event, after numerous privacy and security breaches over the years, occurs, what will happen to the botched service provider(s) after they state, “Oops!”?

Posted by ptiffany | Report as abusive