by Doug Kreitzberg | Dec 23, 2020 | Business Continuity, Facebook, Privacy, small business
Ever since Apple announced new privacy features included in the release of OS 14, Facebook has waged a war against the company, arguing that these new features will adversely effect small businesses and their ability to advertise online. What makes these attacks so “laughable” is not just Facebook’s disingenuous posturing as the protector of small businesses, but that their campaign against Apple suggests privacy and business are fundamentally opposed to each other. This is just plain wrong. We’ve said it before and we’ll say is again: Privacy is good for business.
In June, Apple announced that their new mobile operating system, OS 14, would include a feature called “AppTrackingTransparency” that requires apps to seek permission from users before tracking activity between others apps and websites. This feature is a big step towards prioritizing user control of data and the right to privacy. However, in the months following Apple’s announcement, Facebook has waged a campaign against Apple and their new privacy feature. In a blog post earlier this month, Faceboook claims that “Apple’s policy will make it much harder for small businesses to reach their target audience, which will limit their growth and their ability to compete with big companies.”
And Facebook didn’t stop there. They even took out full-page ads in the New York Times, Wall Street Journal and Washington Post to make their point.
Given the fact that Facebook is currently being sued by more than 40 states for antitrust violations, there is some pretty heavy irony in the company’s stance as the protector of small business. Yet, this is only scratches the surface of what Facebook gets wrong in their attacks against Apple’s privacy features.
While targeted online adverting has been heralded as a more effective way for business to reach new audiences and start turning a profit, the groups that benefit the most from these highly-targeted ad practices are in reality gigantic data brokers. In response to Facebook’s attacks, Apple released a letter, saying that “the current data arms race primarily benefits big businesses with big data sets.”
The privacy advocacy non-profit, Electronic Frontier Foundation, reenforced Apple’s point and called Facebook’s claims “laughable.” Start ups and small business, used to be able to support themselves by running ads on their website or app. Now, however, nearly the entire online advertising ecosystem is controlled by companies like Facebook and Google, who not only distribute ads across platforms and services, but also collect, analyze and sell the data gained through these ads. Because these companies have a strangle hold on the market, they also rake in the majority of the profits. A study by The Association of National Advertisers found that publishers only get back between 30 and 40 cents of every dollar spent on ads. The rest, the EFF says, “goes to third-party data brokers [like Facebook and Google] who keep the lights on by exploiting your information, and not to small businesses trying to work within a broken system to reach their customers.”
Because tech giants such as Facebook have overwhelming control on online advertising practices, small businesses that want to run ads have no choice but to use highly-invasive targeting methods that end up benefitting Facebook more than these small businesses. Facebook’s claim that their crusade against Apple’s new privacy features is meant to help small businesses just simply doesn’t hold water. Instead, Facebook has a vested interest in maintaining the idea that privacy and business are fundamentally opposed to one another because that position suits their business model.
At the end of the day, the problem facing small business is not about privacy. The problem is the fundamental imbalance between a handful of gigantic tech companies and everyone else. The move by Apple to ensure all apps are playing by the same rules and protecting the privacy of their users is a good step towards leveling the playing field and thereby actually helping small business grow.
This also shows the potential benefits of a federal, baseline privacy regulation. Currently, U.S. privacy regulations are enacted and enforced on the state level, which, while a step in the right direction, can end up staggering business growth as organizations attempt to navigate various regulations with different levels of requirements. In fact, last year CEOs sent a letter to congress urging the government to put in place federal privacy regulations, saying that “as the regulatory landscape becomes increasingly fragmented and more complex, U.S. innovation and global competitiveness in the digital economy are threatened” and that “innovation thrives under clearly defined and consistently applied rules.”
Lastly, we recently wrote about how consumers are more willing to pay more for services that don’t collect excessive amounts of data on their users.This suggests that surveillance advertising and predatory tracking do not build customers, they build transactions. Apple’s new privacy features open up a space for business to use privacy-by-design principles in their advertising and services, providing a channel for those customers that place a value on their privacy.
Privacy is not bad for business, it’s only bad for business models like Facebook’s. By leveling the playing field and providing a space for new, privacy-minded business models to proliferate, we may start to see more organizations realize that privacy and business are actually quite compatible.
by Doug Kreitzberg | Mar 26, 2019 | Facebook, Privacy
Two weeks ago, Mark Zuckerberg penned an essay detailing Facebook’s shift towards a more privacy-focused platform. “As I think about the future of the internet,” he writes, “I believe a privacy-focused communications platform will become even more important than today’s open platforms.” For Zuckerberg, this predominantly means focusing efforts more on his private messaging services (Facebook Messenger, Instagram Direct, and Whatsapp) by including end-to-end encryption across all platforms.
But given mirad privacy scandals plaguing Facebook over the past few years, it is important to look critically at what Zuckerberg is outlining. Many of the critiques of Zuckerberg that have been written focus primarily on the monopolistic power-grab that he introduces under the term “interoperability.” For Zuckerberg, this means integrating private communications across all of Facebook’s messaging platforms. From a security perspective, the idea is to be able to standardize end-to-end encryption across a diversity of messaging platforms (including SMS), but, as the MIT Technology Review points out, this amounts to little more than a heavy-handed centralization of power: “If his plan succeeds, it would mean that private communication between two individuals will be possible when Mark Zuckerberg decides that it ought to be, and impossible when he decides it ought not to be.”
However, without downplaying this critique, what seems just as if not more concerning is concept of privacy that Zuckerberg is advocating for. In the essay, he speaks about his turn towards messaging platforms as a shift from the town square to the “digital equivalent of a living room,” in which our interactions are more personal and intimate. Coupled with end-to-end encryption, the idea is that Facebook will create a space in which our communications are kept private.
But they won’t, because Zuckerberg fundamentally misrepresents how privacy works. Today, the content of what you say is perhaps the least important aspect of your digital identity. Instead, it is all about the metadata. In terms of communication, the who, the when, and the where can tell someone more about you then simply the what. Digital identities are constructed less by what we think and say about ourselves, and far more through a complex network of information that moves and interacts with other elements within that network. Zuckerberg says that “one great property of messaging services is that even as your contacts list grows, your individual threads and groups remain private,” but who, for example, has access to our contact lists? These are the type of questions that Zuckerberg sidesteps in his essay, but are the ones that show how privacy actually functions today.
Like a living room, we can concede that end-to-end encryption will give users more confidence that their messages will only be seen by the person or people within that space. But digital privacy does not function on a “public vs. private sphere” model. If it is a living room, it has the equivalent of a surveillance team stationed outside, recording who enters, how long they stay there for, how that room is accessed, etc. For all his failings, we would be wrong to assume that Zuckerberg is ignorant of the importance of metadata. In large part he has built is fortune on it. What we see in his essay, then, is little more than a not-so-subtle misdirect.
by Doug Kreitzberg | Oct 25, 2018 | California Privacy Act, Facebook, GDPR, Google, Privacy, Regulations
Just a few months after Facebook’s highly-publicized data breach California passed the strongest regulations on the collection and sale of personal information that the U.S. has ever seen. Around the same time, the EU passed the General Data Protection Regulation (GDPR) that even surpass the new regulations in California. Then, late last month, Google admitted to a breach of information on their Google+ platform that potentially affected over 500,000 users.
What businesses now need to realize is that such high-profile scandals will likely have direct impacts not simply in Silicon Valley, but on a national and even global scale.
In fact, on October 22, Google, Facebook, Apple and Microsoft are endorsing a federal privacy law based upon a framework developed by the Information Technology Industry Council.
To help businesses better understand the impact privacy regulation may have for them, we have put together the top three implications these new regulations could have on businesses in the coming months.
Consumers will play an active role in how companies collect and use personal information
Perhaps the strictest aspect of California’s new regulations is the central role consumers will now play in deciding how (or if at all) their information is used. Consumers now have the right to request from companies not only what information is being collected (even allowing the consumer to request an accessible copy of that data), but also for what purpose. Moreover the law allows consumers to request that companies deleted their personal information and can even opt-out of the sale of such information.
A broader definition of protected private data.
The California Privacy Act substantially broadens what is considered ‘personal information’ and therefore increases the scope of regulations beyond what we generally consider tech companies. Under the new regulations, ‘personal information’ now includes the consumers’ internet activity, biometric data, education and employment information, as well as information on the consumer’s purchases and personal property. Broadening the definition of personal information therefore implicates far more businesses than the likes of Facebook and Google. Now, any company that collects or uses such consumer data will be subject to regulation.
Targeted advertising will become less effective
The effectiveness of targeted online advertising campaigns relies on the extreme specificity enabled by access to consumer data. As Dipayan Ghosh of the Harvard Business Review points out, these regulations will have any impact on any business that makes use of online advertising. Targeted campaigns will become less precise and may therefore “significantly cut into the profits [ ] firms currently enjoy, or force adjustments to [ ] revenue-growth strategies.”
Any business that has customers in California need to be seriously considering how they will now comply will these new regulations. What’s more, discussions of putting in place federal regulations are well underway and it is possible that California’s new private information laws could form the basis of such regulations. It is therefore in the best interest of any business that makes use of consumer data to seriously consider what impact such regulations could have in the coming months and years.
What should businesses be doing now, even if they don’t fall into under California or GDPR privacy regulations?
- Know what data you are capturing and where it is stored. Review your data flows in your customer, accounting, employee and other databases so you know what you are capturing, the reason you are capturing it and where you are storing it. Keeping an accurate data inventory is critical. And, it makes good sense.
- Be Transparent to your users with what you are doing with their data. Review your privacy policies. Make sure they are free of legalese and clearly explains what you will doing with the data, who (if any) will you share the data with and what rights the user has if they want to have the data changed or removed. Try not to think of this as a compliance exercise. Think of it as customer engagement. By doing so, you can create a better relationship with your customers because you show that you respect them and their information.
- Ask before you Capture — Where possible, get the user’s consent prior to capturing the data. You will have better customers if they opt in to the relationship rather than finding themselves in one.
Privacy does not have to be viewed as compliance or even a restriction on doing business. In fact, successful businesses going forward will use privacy as a tool for increased customer engagement.
