“Personal data is the new oil of the Internet and the new currency of the digital
world.” Meglena Kuneva, European Consumer Commissioner, March 2009
As we move towards a “Web of the world” in which mobile communications, social technologies and online connections are bringing people together into one interconnected network, personal data may soon emerge as “a new asset class,” according to a fascinating report recently released by Bain & Company, in collaboration with the World Economic Forum (WEF PersonalDataNewAsset_Report PDF).
Data, Data Everywhere
The amount of data generated by today’s digital society is astounding. Data is being collected on who we are, who we know, where we are, where we have been and where we plan to go. Mining and analyzing this data give us the ability to understand and even predict where humans focus their attention and activity at the individual, group and global level, the report observes.
This personal data – digital data created by and about people – is generating “a new wave of opportunity for economic and societal value creation,” says the WEF. The types, quantity and value of personal data being collected are vast, from our profiles to our bank accounts, from our medical records to our employment data, from our Web searches and sites visited to our likes and dislikes and purchase histories. Data from our tweets, texts, emails, phone calls, photos and videos, as well as the coordinates of our real-world locations are all being collected and analyzed. The list continues to grow.
A Hot Commodity
Collecting, aggregating, analyzing and monetizing using personal data – in an endless variety of ways – is big business. Companies collect and use this data to track product use and support their business models. Governments employ personal data to provide critical public services more efficiently and effectively. Researchers examine data to develop new drugs and treatment protocols. And, end users benefit from this activity through free, personalized consumer experiences such as Internet search, social networking or buying recommendations.
The largest social network, Facebook, is reportedly looking to cash in its mother lode of personal information by helping advertisers pinpoint exactly whom they want to reach. This is no idle boast. Facebook doesn’t have to guess who its users are or what they like. Facebook knows, because members volunteer this information freely – and frequently – in their profiles, status updates, wall posts, messages and “likes.” It’s now tracking this activity, shooting online ads to users based on their demographics, interests, even what they say to friends on the site – sometimes within minutes of them typing a key word or phrase.
Personal data is “becoming a new type of raw material that’s on par with capital and labor,” says Bain & Company. “Personal data will be the new ‘oil’ – a valuable resource of the 21st century.”
You Can’t Just Hit the ‘Pause’ Button
There is no question about the value of data as an asset.
But, the rapid rate of technological change and commercialization of personal data raise many concerns. The report maintains that current technologies and laws fall short of providing the legal and technical infrastructure needed to support a well-functioning digital economy. Fundamental questions about privacy, property, global governance, human rights – essentially around who should benefit from the products and services built upon personal data – all need to be addressed in order to tap into the real value of all that data.
Something to keep in mind each time we “click” away.