A Digital Bill of Rights By the People, For the People

This post was originally published under the same title on the Personal blog, A Personal Stand.

The Obama Administration unveiled today its long-awaited framework for online privacy, Consumer Data Privacy in a Networked World. The result is a bold and thoughtful step in the right direction, and it will make an impact, regardless of whether Congress acts. It’s another sign that power on the Internet is shifting toward individuals and away from companies.

There’s still much more to do:

1.  In talking about reform and creating a new model, we must put individuals firmly at the center of the framework. This means giving them the tools to drive demand for their valuable data resources to transform the current model into a “user-centric” one. With individuals truly in control – and looking out on the world from their perspective – every other principle and right about privacy falls into place.

2.  While the framework will require companies to re-evaluate their data practices and conform to new standards, what about our government’s obligations in handling our data? The Obama Administration has been impressively forward-looking in this arena – particularly with veterans, education and health record data – but it seems that individuals care as much about what the government knows about them as they do about companies.  We need rules for government, too.

3.  Actual citizens need a seat at the table alongside the privacy advocates, law enforcement representatives, companies and academics that will help establish codes of conduct.  If the framework is being constructed for the benefit of individuals, don’t we deserve a say in the matter, too? Perhaps the final say?

To make the last point a reality, we’re taking matters into our own hands.  In a few weeks at SXSW in Austin, Texas, I will join my friend, Anne Bezancon, founder and CEO of Placecast to create – with other SXSW attendees – a Bill of Rights “by the people, for the people” that we would expect both companies and the government to respect. If you will be attending the conference, please join us for our interactive Sunday afternoon session, We the People: Creating a Consumer’s Bill of Rights. Please also check out the session by our CTO, Tarik Kurspahic, on building a “privacy by design” company.

What is your personal data really worth?

This post was originally published under the same title on the Personal blog, A Personal Stand.

New York Times reporter Joshua Brustein provides a great introduction to the model that Personal and companies like us are developing in “Start-ups Aim to Help Users Put a Price on Their Data.” However, a central question remains unresolved: what is the true economic value of personal data?

No one knows the answer – yet – because no fair market exists for individual data.  The question raises the possibility that, if it’s not very much, people are unlikely to care enough to change their behavior. We believe there are a host of non-economic reasons that people will want to proactively manage their data (time savings, greater privacy, less friction, making better, faster decisions, etc.), but the question of determining economic value is critical.

New York Times photo of Personal team

The current model is built for companies, not people

Some look for clues to the average annual revenue per user for Google and Facebook. These “free” services, whose advertising revenue is based largely on personal data, earn $24 and $4 respectively per person every year. But is $28 enough to motivate people to change their behavior and do a lot of work? Maybe not.  But it is the wrong question. Properly used, we believe companies like Personal will be able to prove your data, when tied to a single purchase, can create 10-20x the value that Google or Facebook can over a year.

The current paradigm is entirely dysfunctional and inefficient from the perspective of the individual. For example, the Direct Marketing Association says over 97% of online advertising fails to reach the right person at the right time. The pennies from the 3% success rate may add up for companies exploiting data across millions of people, but it requires a number of unsustainable practices, such as the increasingly invasive and sometimes unethical tracking of people. It also requires that they co-opt your attention and time and resell that along with your data to others trying to reach you.

The emerging user-centric marketplace

What might a user-centric marketplace look like and how much economic value can a person realize in a year?

First, you need a marketplace that respects the sanctity of one’s data, time (time is money, after all), privacy and identity (anonymity is the default). The technologies, business rules, and legal and privacy protections must be created nearly from scratch to protect the individual. (Our CTO, Tarik Kurspahic, will present at SXSW on building a privacy-by-design platform).

Second, the marketplace would focus on commercially relevant data such as your brand, travel or clothing preferences, along with data about your intent to buy something (also known as purchase intent).  These two types of data alone can fundamentally change data economics when combined with a controlled marketplace to reach you when and how you want to be reached.

This last point is key. We do not support the idea of people “selling” personal data. Rather, we believe such data can be used in a safe environment to connect people with companies with highly relevant products, services and even content and information. Doc Searls and others have referred to this idea as Vendor Relationship Management (VRM). Companies that play by these new rules will have the most direct and positive channel ever created to reach people, including their existing customers.

People can realize thousands of dollars per year

Finally, we believe companies that earn your business (and those who don’t) will be willing to compensate individuals for having the chance to interact with qualified buyers of their particular good or service.  This far more efficient marketplace can easily add up to thousands of dollars annually as people realize the full benefit of their data, time and purchases. That should move the needle for just about anyone.

We appreciate the serious attention being focused on this emerging space by the New York Times, as well as The Wall Street Journal, The Economist, AdAge, AdWeek, Forrester Research, MIT Tech Review, The Washington Post, TechCrunch, Mashable, the Harvard Business Review and others. It is an idea that will ignite untold innovation and benefits for each of us.

A World Without Borders – Customer Data in Bankruptcy

Here is the link to my post in the Personal company blog on how customer data should be treated in bankruptcy: http://blog.personal.com/2011/09/a-world-without-borders-–-customer-data-in-bankruptcy

We don’t have this issue at Personal as individuals own their data from the start when using our data vault service (thus there would be no “customer data assets” for us to sell were the company to go out of business), but I expect it to become a bigger and bigger issue in the coming years.

The Data Wars Begin

In a week where President Obama and the White House announced their intention to enter the fray over consumer data and privacy, the most interesting recent news has actually been the rapid escalation between Google and Facebook over data ownership. Framing it in terms of a trade war, TechCrunch declared the beginning of true data protectionism, and has been highlighting the almost daily back and forth between the two biggest aggregators of consumer/Owner data in the world.

This fight over the right to export email and contact data from one service to the other is shining a bright light on the much larger and more important issue — how critically dependent they both are on owning and controlling your and my data. No matter their rhetoric, their actions cannot hide the fact that the they look at our data as theirs. Pretty hard to start a trade war if you don’t have some kind of good or service to withhold. In both cases, the only thing they have to hold hostage is our data. That’s it.

Most trade wars are bad for everyone involved. This one, however, might end up helping Owners. Unlike privacy, which has proven harder to understand and to motivate people, data ownership is far more tangible. Either you can do what you want with your data or you can’t. There is not much room for either of them to sit on the fence. If Google and Facebook continue to retaliate, which I’m betting they do, they will do more to show their true colors around data ownership than anything the White House or Wall Street Journal could do combined. Should be fun to watch.

S.

Owners, not Consumers or Users

Consumer — an individual who consumes something made by someone else, usually with some kind of direct and clear payment. The most common name used by companies to refer to individuals.

User — an individual who uses something made by someone else, usually with some kind of payment, although not frequently direct or clear. The most common name used by web and mobile companies to refer to individuals.

I’d like to propose a new word for the new media lexicon: Owners. Companies are very clear on who their “owners” are, and they go to work to pursue their interests every day. When it comes to our data and time, we should start thinking of ourselves as a little enterprise organized for the express benefit of ourselves. We have tools never before imaginable to build a far more favorable model for ourselves.

But what do we, as enterprises, do?

What product do we make? What service do we provide?

What marketplace are we in? What forms of payment do we accept?

How do we calculate our bottom line?

In the multi-hundred billion dollar industries funded by advertising, the first answer is quite simple: we make data. Data has become a new form of currency in the connected world (joining money and time), and we, as individuals, have an unfair advantage in creating, aggregating and owning the best data about ourselves as Owners.

We also provide the critical service of our time and attention and deciding to whom to give this finite resource. Our marketplace is one where we allow others we trust, companies or individuals, to find us or know us better through our data and to eliminate huge inefficiencies and costs in our lives — and theirs. This marketplace applies to any industry that uses data today — advertising, media, entertainment, retail, health, travel, etc. As payment, we accept cash, discounts, special personalized offers, time savings, mind blowing relevance and discovery, improved safety and security, and guarantees of privacy.

Our bottom line is the most interesting of all to consider. Given the many forms of payment, each of us can choose which of these benefits to emphasize. And unlike most businesses, we can decide on a case by case basis which is most important. Sometimes I might like to maximize my economic benefits (like most traditional companies), but at others, mind blowing relevance and discovery may be most important (such as my upcoming vacation with my family). In a rush, convenience and time savings are probably most important. None of the forms of payment are mutually exclusive, but trade offs will need to be made for the good of our enterprise — just as any great manager has to do.

I hope you will consider using Owner when referring to yourself in the context of using services that require your data or time. Names matter.

S.

Early Concerns about Being Defined by Others (1992)

I would probably be too embarrassed to mention my graduation speech at the University of Michigan in May 1992 had it been a glorious success. As it were, gathering storm clouds over Michigan Stadium forced school officials to rearrange the program, pushing commencement speaker Carole Simpson of ABC News and other dignitaries in front of my speech. In addition to being the opening band trying to follow the main act, I was further thrown off when the wind blew off my my graduation cap as I was about to stand up, putting an exclamation point on the fact that we were all soon to get soaked. I rushed through the speech amid cat calls and growing restlessness. I remember my international affairs professor, Raymond Tanter, telling me later that I had a hard lesson in the fact that timing is everything. Yes indeed.

I only recently realized how much the speech suggested themes of Personal after digging it out of a box in my basement. I was outraged at the time that the label “Generation X” had been so successfully tagged to us by the media and others. At best, we were “materialistic and apathetic”, as I wrote; at worst, we had no name whatsoever. The speech was titled “On Defining a Generation”, and was a call to arms to my peers to take control of their identities and not let others define them individually or as a group. Here are a few excerpts that are eerily relevant to how I believe we are being represented by others who capture our data and define us by it, as well as the value of your intent data (your future behavior) vs. your historical data:

“…Until now, we have been shaped and defined by our parents, our schools, and the media. Today, it is our time to bring together where we have been with where we want to go, and in so doing, to define ourselves.

“…It is a dangerous thing to let others tell you who you are. No one can understand the complexities that make up the mind and soul of another individual. Such attempts to define a person usually fall short; they limit rather than capture essence…Do such attempts to simplify our diverse character affect us?

“…These diverse experiences are all part of our generation, and they show the impossibility of arriving at singular conclusions about our character. We should not attempt to stereotype ourselves, rather, we must reflect on these shared experiences and begin to understand and thoughtfully define our generation.

“…[I]dentity is not simply a composite of the past. We can be identified as much by where we are going as where we have been. This may be the more important task in this process, because it is the part over which you and I have control. What problems are we committed to solving? Are there goals and ideals that the majority of us share that give us distinction from other generations? Or maybe the discipline, will power, and most importantly, the tolerance, to accomplish our goals is what will set us apart.

“I encourage you to be active and thoughtful in defining our generation. Because if we do not define ourselves, experience has shown us that someone else will.”

I was obviously referring to the traditional “media” at the time, and not Google, Facebook or any of the data and technology-driven media companies of today who are defining us digitally by capturing all that we do on their sites and others. Little did I know that one of the co-founders of Google, Larry Page, was just behind me at Michigan and was soon to envision one of the greatest data collection and organization tools in human history, or that the quality of our lives would be increasingly shaped by our identities and reputations in the online world.

In his far happier commencement speech at Michigan in 2009 (as the main act, not the student warm up band), Page shared one of his favorite quotes, which I had not heard but really like: “Always work hard on something uncomfortably exciting.” Amen.

I think this would qualify by his definition: Help people understand how incredibly limiting and inefficient it is to be defined by companies using data they surreptitiously capture about us, and instead provide individuals with the understanding, tools, transparency and incentives to take control and do it themselves.