Chill out Apple, we know what you’re doing…
Ahhhh, at last, Data Privacy Day……
As an international Holiday, January 28th provides a time to celebrate and acknowledge how far we’ve come in personal data protection and privacy. And since no other city celebrates better than Las Vegas, let’s recap some of the highlights of the 2020 CES Conference that just ended in Sin City. For you non-techies, the CES show is considered by many to be “The Show” for consumer technology enthusiasts.
CES started back in 1967 and has grown to see this year’s conference hosting over 157,000 people, 4,500 exhibiting companies, and over 1,000 expert speaker workshops.
And this year the focus got even better……
For the first time since 1992 Apple participated in the conference, but NOT to promote a product but rather to participate in a session titled “Chief Privacy Officer Roundtable: What do Consumers Want?”.
A little fun fact: Did you know that while Apple vets the apps in its store, it does not make them comply with their own “What happens on our iPhone stays on your iPhone” mantra?
Google also choose the CES Conference platform to announce its new Google Assistant features that allows the user to say things like “Hey, Google, that wasn’t for you”. These voice commands will delete whatever you just said or can delete entire time periods of conversations. Now let’s be honest, how much is that really going to resolve? I agree that the concept is beneficial and much needed, but how do we know that what we “deleted” wasn’t just deleted from our device and is still stored in another cloud file?
Facebook was at CES, of course, and announced a new version of its “Privacy Checkup” tool to help users control who can see what they share and how they can boost their account security.
In case you forgot, on July 24th, 2019 Facebook was fined $5 BILLION dollars for violating consumers privacy. And for what its’ worth: when Facebook launched its 2012 IPO, it valued its aggregated user data on its balance sheet at nearly $6.6 BILLON dollars.
I think this headline from The Washington Post says it all:
“At CES, Apple, Facebook and Amazon are preaching privacy. Don’t believe the hype.” – Washington Post
What does all of this say about the value of our personal data? Let’s take this a step further…..
20% of large UK firms have started accounting for the value of their data and listing it on the company balance sheet as an asset. As far back as 2011, AT&T valued their customer relationships at almost $2.7 BILLION on their balance sheet.
Unlike hard assets a company might “own”, collected data actually appreciates in value over time, especially as it gets pulled into complicated algorithms that assist in monetizing this data. This makes data a very intriguing “investment”.
A piece of personal data, once collected, can have multiple revenue streams.
1. My data can be used to sell to companies that want to advertise to me (do I get a commission on that?)
2. My data can be sold to other data collection companies (do I get a commission on that?)
3. My data can be sold to companies to assist them in deciding what new widgets or services to build and create (do I get any royalties on those new products & services?)
4. My data can be used for entirely different reasons than originally intended and I GET NOTHING FOR IT! Take the recent “new” business model of 23andMe (over 10 MILLION DNA testing kits sold at $99) that used client data to develop a drug that it just sold to a large pharmaceutical company.
Based on the amount of money a company like 23andMe is likely to make off of its clients data going forward, would you recalculate how much your personal data is worth?
Personal data is a great asset for any business to own because multiple revenue streams are ideal for exponential growth and creating shareholder value.
Data is the new version of money but better. It’s easy to create new forms or definitions of data. As data becomes more and more valuable, theft of that data, as we are already experiencing, becomes more widespread, more creative, and more expensive to protect. OUR DATA is producing an economic bubble that is getting ready explode, and not in a good way. Oh wait, I forgot that the Cyber-Security industry is there to protect our data. Let’s see…..
Everything we do these days seems to be in the cloud, supposedly because it’s cheaper, easier, and faster to store our data there. It’s also easier, and usually mandatory, for us to give our data to any company if we want to use their products or services. We could just go back to the good old days when we had to personally interact and hand over some actual cash to buy something, but that will never happen again….. So, in order to make purchases virtually, we have to make sure we purchase security software to protect our personal data. We might even buy additional insurance, in case the security software we use doesn’t work. In addition, the companies we make these purchases from have to spend crazy amounts of time and money to put in security systems and protocols on their end. And then, when our data is eventually hacked or stolen, we have to spend more money and time to either get it back or re-create it.
But back to the data. Many companies have captured our personal data (not free), or purchased our personal data (not free), but still have to figure out how to monetize that data. Don’t worry, I think I know a few “consultants” that can help them do that, and their hourly rates are still under 4 digits, at least for now.
I’m so glad we live in the cloud and on the internet now. It’s really made things so much cheaper, faster, and better…..
Before I sign off this week, here’s one more example of what OUR DATA has created in Economic Growth, from a company very few people would define as a Technology Company.
According to The Wall Street Journal, Kroger, a GROCERY STORE CHAIN, makes $100 MILLION dollars per year by selling its customer data to other companies like Proctor & Gamble and Nestle’.
Now that’s what I call a little “icing on the cake”.