"A common misconception from fearmongers is that your data is being sold. It is not."
I'm calling "Srawman" on this.
The correct conception is that it could be sold and the Market Economics Fairy has predicted that it will be sold as soon as a willing buyer and willing seller agree on a price. Indeed, if Facebook fails, all their data will almost certainly be sold along with the rest of their assets.
Likewise, Google has an increasingly strong incentive to sell user data as its perceived value increases and the cash flow per "unit" decreases. That Google sees this as a distinct probability is clear from their privacy policy which gives them the right to use user data "to develop new services." No one should be surprised by this because failing to reserve rights to a potential revenue stream would be irresponsible behavior by Google management.
If the thesis of the article is correct, sale of data is increasingly likely as the online advertising model pivots away from personalized advertising and the attractiveness of creating alternative revenue streams from the data increases.
Google wouldn't even consider selling that data unless they were losing money, and they'd probably consider a good many things before they'd resort to selling it even in that case.
Right now, Google has that data and nobody else on planet earth does. That's strategic. A couple million dollars isn't worth changing the game.
There are companies that sell browser data, it's anonymized, and it's much smaller than what Google or Facebook presumably has.
We just hold different opinions regarding under what conditions it is likely to occur. Google or Facebook's proprietary access to the data they have collected only makes strategic sense so long as there is strategic value in exclusivity. Given that there already are a variety of ordinary existing circumstances in which exclusivity is not strategic - e.g. subpoena - the argument that it is only in extraordinary business circumstances that the data might be sold needs a stronger case made in its favor.
We are not talking about a few million dollars, but several billion or more. Just look at patent portfolios for a parallel way in which the market may suddenly revalue intangible assets. Particularly consider the case of Nortel and if Facebook could experience a similar demise over the next twenty years. Even if Facebook stopped collecting data today, most of it would still shed light on living people.
I'm saying it's very low on the list of possibilities. Most of the data is of transient value (browser cookies last around 30 days on average). If Google is whittled down to a shell of its former self, to the point where they'd consider selling that data, presumably what data they have at that point isn't really that valuable.
On the one hand, I find it hard to believe that Google is not extracting data from cookies and looking at it over the long term.
On the other hand, I know that much of the data which Facebook is collecting will be pertinent twenty, thirty and forty years from now...e.g. my cousin will still be gay in 2036.
Finally, the notion of Google selling their data only seems remote given the current state of affairs. If Facebook starts selling direct access to their data, it makes Google far more likely to follow suit not only based on a need to stay competitive but also because the standard of acceptable behavior has been lowered and a new status quo has been created.
One need only look at the speed at which telephony has changed over the last five years or the music industry over the last ten to realize that business models of established companies can change rapidly.
>On the other hand, I know that much of the data which Facebook is collecting will be pertinent twenty, thirty and forty years from now...e.g. my cousin will still be gay in 2036.
I think Google could probably guess most gay people are gay from their searches, and the pages they visit.
>The correct conception is that it could be sold and the Market Economics Fairy has predicted that it will be sold as soon as a willing buyer and willing seller agree on a price.
Mmmmm... unfortunately, I think YOU'RE the one with the strawman argument here. The misconception that he's talking about is the notion that "the purpose of collecting your personal data is to sell it to the highest bidder". That IS a misconception. The purpose of collecting user data is to rent out the aggregate value of it to advertisers. The fact that the collector might someday be forced into receivership and the user data may end up on the auction block as part of their assets is not actually relevant, because a purchaser of such is ALSO not interested in selling the data for profit, but rather collecting rent on the aggregate value of the data from advertisers.
My premise is that once Facebook's assessment of the net present value of exclusive use of its data is less than a willing buyer's assessment, the likelihood of a sale is significant (it is also a premise that this also holds for Google).
A second premise is that companies which own data may have that data acquired through dissolution, merger, or acquisition; and that in such circumstances the asset may be monetized differently than it is currently.
This may be pessimistic, but betting on the benevolence of corporations is not supported by history.
I'm calling "Srawman" on this.
The correct conception is that it could be sold and the Market Economics Fairy has predicted that it will be sold as soon as a willing buyer and willing seller agree on a price. Indeed, if Facebook fails, all their data will almost certainly be sold along with the rest of their assets.
Likewise, Google has an increasingly strong incentive to sell user data as its perceived value increases and the cash flow per "unit" decreases. That Google sees this as a distinct probability is clear from their privacy policy which gives them the right to use user data "to develop new services." No one should be surprised by this because failing to reserve rights to a potential revenue stream would be irresponsible behavior by Google management.
If the thesis of the article is correct, sale of data is increasingly likely as the online advertising model pivots away from personalized advertising and the attractiveness of creating alternative revenue streams from the data increases.