In 1990s, I made a rather controversial and enduring proclamation: “You have zero privacy anyway. Get over it.” It wasn’t a moral recommendation on how businesses should treat their customers, or an invitation for brands to employ surveillance on consumers. It was a realistic and factual comment on the growing scope and capacity of internet technology, the just emerging smartphone access, and on how consumers were wielding that technology.
Back then, the social media platforms we all use today were yet to be conceived, banner ads were innovative and cool, and consumers were unaware of the wealth of data being collected on them.
Fast-forward 20 years, and we’re truly in the midst of a new age of privacy challenges. Digital consumers are more confused and suspicious than ever when it comes to the unconditional transfer of their personal data, and they are quickly becoming more interested in their rights under burgeoning privacy legislation sweeping the globe. The Cambridge Analytica scandal didn’t just make the tech press but unfolded on front pages the world over. And with every negative headline, consumer trust has eroded in organizations that use purchased data sets, cookies and click trails to power their marketing.
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You are not friends with Facebook and Mark Zuckerberg. You are their product.
The reality is that the technology and tools that businesses have employed to snoop on consumers is so sophisticated and stealthy that consumer education and, in many legislators’ minds, regulations are needed to stop the unauthorized collection, repackaging and reselling of this data.
The age of fast and loose data collection and redistribution must come to an end and be replaced by enhanced consumer privacy education and commitments, so therefore I am not surprised by Tim Cook’s unfortunate call for federal privacy regulations.
Personally, I would rather see businesses move more proactively and compete with other businesses on their own Customer Bill of Privacy Rights. And I would also rather see regulators spend more efforts to protect citizens from government abuse of personal data. The invisible hand of private markets will work if we educate ourselves, but it does not work on the government abuses. Only voting can fix that.
Consumers should know where their data are
Informed consumers should make sure they understand what the brands they purchase from are committing to with respect to their data. If business doesn’t act first, I fear that government will step in and regulate, creating confusion, bureaucracy, reduced choices and increased cost for consumers.
Hence, I do not support Cook’s suggestion that government should be the data clearinghouse for all our personal data. We don’t just need privacy protection as consumers, we need it as citizens as well. Government has access to even more sophisticated tools for snooping, collecting and storing data on us. And I would argue they have the capacity for much greater harm than businesses like Facebook, Cambridge Analytica or Acxiom.
You can always shut down your Facebook account, switch your phone carrier, or buy online from someone else who respects your data. It is very hard to control rogue government abuses and roll back bad legislation.
The files released by Edward Snowden revealed the National Security Agency was collecting huge amounts of data on millions of American citizens. From secret court orders forcing Verizon to hand over call records on millions of Americans daily, to the use of secret programs such as XKeyscore, an analytical tool that allows for collection of almost anything done on the internet, our privacy is constantly compromised without our knowing.
For many Americans, it was a shock that the government surveillance program was so extensive in its targeting of masses of ordinary U.S. citizens. Privacy rights and regulations is a discussion that should not just be constrained to consumers and businesses, but also citizens and governments. The past few years have shown us there is much work to do in both areas.
More important, the amount of data collected and the abuses (past, present and future) perpetrated by the government become ever more problematic as federal, state and local scope creep accelerates. When I was a child, we did not have a Department of Education, Obamacare, Fannie Mae, Freddie Mac, massive student loan programs, free phones, up to 40 million people on food stamps, massive regulation and the more than $2 trillion of federal redistribution annually. Government has become far too important in the lives of far too many of our citizens. Giving it unregulated access to our personal data is dangerous.
Rebuilding trust starts with openly sharing data
If businesses want to rebuild trust and build more meaningful connections with consumers, then it’s time to embrace the Zero-Party Data economy. “Zero-Party Data” was coined by Forrester’s principal analyst, Fatemeh Khatibloo. It describes a class of data intentionally and proactively shared directly with businesses by the consumer, such as preference insights and purchase intentions, often in return for some sort of value exchange like access to content, offers or competitions.
This is a much more transparent, honest and fair way to collect and use consumer data for personalized marketing. It contrasts heavily with the way marketing has developed over the past few years, championed by companies like Facebook, where marketers were encouraged to leverage a coterie of third-party data suppliers and data integrations, to target people with the right advertising at the right time.
Make no mistake, informed consumer consent was never gathered for the way these data have been repackaged and resold across the marketing supply chain. Brands should distance themselves from indulging in personalized marketing that relies on such data, or platforms that promote their use.
Personalization of marketing communications should be driven only from what is proactively shared by consumers with their consent. We should have the expectation as consumers to own our own data, and choose who can use it.
Data have the power to create huge monopolies, or even influence democracies. Transparency in these matters is essential for a healthy world, both as consumers and citizens.
Scott McNealy is the chairman and co-founder of Wayin, founder of Curriki and the former chairman and CEO of Sun Microsystems. Follow him on Twitter: @scottmcnealy