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Does Data Belong to Us?



Kirjoittanut: Xiaoqing Yang-Pyydysmäki - tiimistä FLIP Solutions.

Esseen tyyppi: Yksilöessee / 2 esseepistettä.
Esseen arvioitu lukuaika on 7 minuuttia.

From last year to now, this news keeps appearing in the headlines of the media.

  • “Facebook says Apple’s new privacy rules will hamper its ad service” (Published: August 27, 2020 CBS/AP)
  •  “Editorial: Tech must choose sides in Apple-Facebook privacy fight” (Published: By Mercury News& East Bay Times Editorial Boards, February 6, 2021)
  • What’s Behind the Apple-Facebook Feud? #englishheadline”(Published: By Englishheadline, April 27, 2021)

All of this news is actually talking about the one thing, Facebook is using user‘s data to make money, Apple is taking action to protect user privacy and prevent more user data from being obtained and used by third parties. What happened? Has our data been used without our permission? Isn’t the user’s data supposed to belong to the user? How big companies handle user’s data? As a startup company, what kind of impact we can get from this privacy war? Here I will specifically introduce how giant companies treat user’s data and follow what is their privacy policy.

Amazon

As mentioned in the essay AI Overview, Amazon is one of the biggest technology companies which is using a lot of AI technologies to process the collected user data. They are personalizing buyers’ experience based on their purchasing history, browsing history, and buying habits. The system would like to learn buyer’s data as much as possible to predict user’s behavior and provide the most relevant products or services. According to McKinsey’s estimates, about 35% of purchases on Amazon come from product recommendations (Faggella, 2017). For the seller, they are using ASIN (Amazon standard identification number) to track different types of purchasing keywords in Amazon search (Hufford,2021). It also provides the sales number, number of clicks, times of adding to the shopping cart, average price, and so on. Basically, all the user activities on Amazon will be recorded for further analysis. This helps the precise placement of ads, buyers are more likely to find their favorite ones from thousands of products, sellers adjust sales strategies in a timely manner based on buyer’s dynamics. But what’s hidden in this, is the data from users which relates to the user’s privacy and all online behaviors. Does it mean people are using the platform, so the data should belong to the platform? In fact, all of this has been decided from the moment you press the “Agree” button on the User Agreement and Privacy Policy. “You can choose not to provide certain information, but then you might not be able to take advantage of many of the Amazon Services.” (Amazon.com Privacy Notice, 2021)

Facebook

Facebook as the largest social media site in the world has more than 2,6 billion monthly users (Tankovska, 2021). Unlike Spotify or Netflix, Facebook requires no monthly fee nor in-app purchasing. Advertisement is the key to how Facebook makes money. In the year 2020, about 98 percent of Facebook revenue came from advertising. People are using Facebook to connect and communicate with family and friends. And they are mostly with real identities, therefore the platform can clearly know the real information of each user, user’s connections, and the trajectory of using the services. This is critical for the advertisers. For the traditional way of advertising, the advertiser generally has to spend lots of time and money on tracking users’ behaviors, preferences, and analyzing their gender, age, hobbies, consuming capacity, and shopping habits. But this information is already available for Facebook. They are mastering all their online users’ data which is mostly private data. Hence, Facebook could use users’ information which including location, gender, age, keywords, education level, work location, social status, and interest groups, etc. to accurately deliver the advertiser’s messages – ads directly to the target customer group. Facebook’s philosophy is about information sharing (Raynes-Goldie, 2010). The more you share, the more Facebook gets to know you and your data.

In the year 2018, Facebook was involved in a scandal. The media revealed that Cambridge Analytica, the data analysis company, obtained data from 50 million Facebook users and conducted misuse (Confessore, 2018). There ain’t no such thing as a free lunch, the price of free use of social media channels is to give up our data.

Google

Advertising is also the main income source for Google. About 81% of their revenue comes from it (Johnson, 2021). Google’s advertisement is according to the search keywords, and the ads are highly targeted. Sametime, Google is using AI (Machine Learning) to keep improving. The statistical information of their clicks on search results and advertisements can be used to improve the match between search and advertisement, making advertisements and search content more relevant, and the click-through rate will be higher.

Figure 1. Google’s “Why this ad” examples

“Why this ad” (see Figure 1, source: google.com) of Google provides the name of the advertiser that has been verified and reviewed, allowing users to see all the details of the ad, why the ad is displayed on this page, and the advertiser of the page. At the same time, users can also set the advertisement according to their own preferences, such as blocking and reporting this advertisement. This setting provides users with better information transparency and credibility, also gives users the freedom to choose to receive advertisements and enhances user experience.

The War between Apple and Facebook

The war between Apple and Facebook (Miller, 2021) stems from Apple’s system iOS14.5. A new privacy protection design of “App Tracking Transparency” is added to restrict mobile apps from collecting information that can be used for targeted advertising. And it will ask users if they allow the app to track information when they install new apps. Like Tim Cook claimed in his tweets that “We believe users should have the choice over the data that is being collected about them and how it’s used. Facebook can continue to track users across apps and websites as before. App tracking transparency in IOS14 will just require that they ask for your permission first.” If a developer is found to have violated the new regulations, Apple has the right to ask the other party to change it, otherwise, it will be removed from the App Store.

For companies that rely heavily on advertising like Facebook (98%), Google (81%), Facebook is the most opposed among the technology giants. Last year, Facebook warned that Apple’s privacy protections in the new system may cause a 50% drop in advertising revenue. They claimed that restricting customized advertising would cause a devastating hit to small businesses (Levy, 2020).

Dr. Know-it-all

Dr.Know-it-all is a professor from the University of Georgia that I interviewed when I was researching the topic of AI. When I asked him, that big data is so important for the companies, but to whom should the data belong? He gave an example of what happened to himself. When he applied for a loan from a bank earlier, the bank’s system asked the question like at what street he lived when he was a certain age, it’s something he cannot remember but seems the bank knows. That reminded him, how much of our data has been mastered by others, and they know our data better than us. He also explained the current situation is like the horse is left the barn which is too late that many big companies are already having our data. On the practical side, governmental oversight would be an idea in the future to control this phenomenon. The ideal state for him is that one day the data can be cut off from individuals, which means the data will be still available but stay anonymous.

Startups

Apple’s new system will close one of the marketing doors for business in the future. Facebook indicates that, if small and medium-sized enterprises (SMEs) do not have precise delivery technology, it will be difficult to find potential user groups. The efficiency of advertising will be greatly reduced. If there is no accurate delivery technology, the conversion effect of SMEs will lose 60% of their sales. (Levy, 2020) Is it possible for companies to collect data that is both valuable and does not connect to user privacy? There is an urgent need to find a balance between these two. At this point, there might be no good solution yet. But what Google did seem a promising start. Google’s “Why this ad” made advertising no longer be mysterious. Users can get clear information that why the ads appear at the time. Moreover, users can modify the ads settings to block it, or report it. This strategy not only wins the user’s consent but also obtains the data. At the same time, it also establishes possibly a better image in the eyes of users.

Conclusion

Data is the oil in the 21st century (Humby, 2006). The big technology companies and many more are using their customer base and an ecosystem approach to grow revenues and offer better products and services (Talin, 2021). When you enter this digital ecosystem, data is generated by your click, browse, enter, download on the Internet, and even use fingerprints on your mobile phone. All information enters the online ecosystem without exception.

From the users’ perspective, we may all applaud Apple’s justice. And hope the day Dr.Know-it-all wished comes sooner. We believe our data belongs to us. We need to ask ourselves every time when agreeing on the onUser Agreement and Privacy Policy, is the value of my data equivalent to the use of this service? We need to be aware of this reality as well as learning how to protect our personal data.

On the other hand, from the startup company’s side, we need data. Big data makes the algorithm more precise and can create massive additional value for the companies. We can learn customers better from big data, as it comes naturally from people’s daily life. The fact that hidden data collection is no longer valid. We need to be more innovative, creative to search the solutions and increase transparency to let people understand our attitudes and values.

References

CBS/AP, 2020, Facebook says Apple’s new privacy rules will hamper its ad service. Retrieved from https://www.cbsnews.com/news/facebook-ad-service-apple-privacy-rules/

Mercury News& East Bay Times Editorial Boards, 2021, Editorial: Tech must choose sides in Apple-Facebook privacy fight. Retrieved from https://www.mercurynews.com/2021/02/06/cook-apple-facebook-zuckerberg-privacy/

Englishheadline, 2021, What’s Behind the Apple-Facebook Feud? Retrieved from https://englishheadline.com/whats-behind-the-apple-facebook-feud-englishheadline/

Daniel Faggella, 2017, The ROI of recommendation engines for marketing. Retrieved fromhttps://martechtoday.com/roi-recommendation-engines-marketing-205787

Jillian Hufford, 2021, Amazon ASIN: What is an ASIN number? Retrieved from https://www.nchannel.com/blog/amazon-asin-what-is-an-asin-number/

Amazon.com Privacy Notice, 2021. Retrieved from https://www.amazon.com/gp/help/customer/display.html?nodeId=GX7NJQ4ZB8MHFRNJ

Clive Humby, 2006. Data is the new oil. Retrieved from https://en.wikipedia.org/wiki/Clive_Humby

Tankovska, 2021, Most popular social networks worldwide as of January 2021, ranked by number of active users. Retrieved from https://www.statista.com/statistics/272014/global-social-networks-ranked-by-number-of-users/

Kate Raynes-Goldie, 2010, The Philosophy of Facebook. Retrieved from http://www.k4t3.org/2010/12/02/the-philosophy-of-facebook/

Nicholas Confessore, 2018, Cambridge Analytica and Facebook: The Scandal and the Fallout So Far. Retrieved from https://www.nytimes.com/2018/04/04/us/politics/cambridge-analytica-scandal-fallout.html

Joseph Johnson, 2021, Google – Statistics & Facts. Retrieved from https://www.statista.com/topics/1001/google/#dossierSummary

Kirk Miller, 2021, Apple and Facebook’s Privacy War, Explained. Retrieved from https://www.insidehook.com/daily_brief/tech/apple-facebook-privacy-war

Dan Levy, 2020, Speaking Up for Small Businesses. Retrieved from https://www.facebook.com/business/news/ios-14-apple-privacy-update-impacts-small-business-ads

Benjamin Talin,2021, What is A Digital Ecosystem? – Understanding The Most Profitable Business Model. Retrieved from https://morethandigital.info/en/what-is-a-digital-ecosystem-understanding-the-most-profitable-business-model/#Digital_Ecosystem_Example_Amazon

 

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