By Rajat Singhania
Data Privacy, a new checkbox against every app that is being conceived and developed is going to lead the next phase of adoption and awareness regime for both the consumers and the developers. With consumers becoming more aware of the fact that data is private and valued, the entire conversation starts as soon as any app is downloaded. The debate gathered tail winds when one of the most used apps updated their privacy policy, and people felt that it verges on user surveillance and threatens India’s security. However, the question still remains, how much do the consumer and the user understand about data privacy? And do they also understand the cost related to privacy?
As technology make inroads into every sphere of life and more marketing access is generated based on the available data, in depth data analysis and its usage to identify and target the right consumers, data mining and interpretation will be one of the most valuable business propositions. This data is collected in numerous ways. While we have already seen instances how customer data has been leaked through banks, breaches at several others exposed hundreds of millions of records. However, it is important to note that the customer is himself or herself approving data sharing while they are installing the apps. There are numerous approvals requested when one app is installed and used. Very few people are aware of the implications for approving the questions that pops up on the screen during that time.
In a world based on artificial intelligence, we need to recognize the strength of the AI and it is necessary that common people get trained on how data is getting generated. While people do like free apps, one has to understand that there are no free lunches. If an app is offering free service, then it is definitely making money by either in-app advertisements, purchases and most importantly by data mining.
While overall knowledge of consumer privacy is on the rise, many consumers still don’t know how to protect themselves: for example, studies suggested that only 14 percent of internet users encrypt their online communications, and only a third change their passwords regularly. A worldwide study by Harvard Business Review showed that privacy activists were more comfortable with data trade-offs. Studies show that, when asked if individuals were willing to provide their purchase history in exchange for personalized products and services, 62% of privacy actives were comfortable with the trade-off versus 32% of non-privacy actives. When asked if individuals were willing to share information from smart home speakers in exchange for health and safety warnings for the entire family, 44% of privacy actives were comfortable versus only 17% of non-privacy actives. Across the board, privacy activists were twice as likely to be comfortable when faced with sharing their information in exchange for a personal or public benefit.
Consumers will need to understand the consequence of free apps and how they can protect their own data by choosing to pay for usage. Then only the developers and the marketers of the app will recognize the need or rather the demand of data privacy, acknowledge the changed mindset of the modern generation and limit the request for more information. However, at no point can this be a one-way traffic. The app developers will only react to the consumer wish, and it is the consumer, who will need to re-orient their own thoughts. When the pop-ups like “By using this site, you agree to our updated Privacy Policy and Terms of Use,” are accepted and approved, it is unclear to the average consumer, how much data the privacy policy affects. No one reads the small text and it can be covering anything from “We only use your data so our website responds more quickly to your requests” to “BEWARE! We track your every move and sell your data every chance we get.” A detailed privacy policy or terms of use page may be well-intentioned — but sorting it out is a lot of work, and may not be enough for these important customers.
The stakes are high for companies handling consumer data: even consumers who were not directly affected by these breaches paid attention to the way companies responded to them. The way start-ups and app designers handle consumer data and privacy can become a point of differentiation and even a source of competitive business advantage in the coming years. As smartphones become smarter, and the apps in it become ubiquitous with technology more accurate, an industry of gathering information while snooping on people’s daily habits will spread and grow more intrusive. It will become a separate business to teach and train the consumers of how much, how often and when technology is breaching privacy rather than helping him. And of course, someone will have to tell the users that they are receiving the services of the app for free because advertisers are helping monetize and pay for it, in return of user data.
(The author is the founder of SocioRAC. Views expressed are personal.)
