Tech giants--and massive data collectors such as Google and Facebook--may want to disclose to customers what their information is worth to the platform to improve transparency.
That nugget comes from a policy paper from U.S. Senator Mark Warner and may be one of the bigger data transparency suggestions to ponder going forward.
Axios posted Warner's white paper, which is designed to spur discussion about data privacy regulation, and the takeaways include some of the typical issues such as disinformation, data transparency and adopting a framework similar to Europe's GDPR regulation.
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The white paper may give some tech giants heartburn given that they are wrestling with GDPR. For instance, Facebook last week said its engagement fell in Europe and 1 million people opted out of its data collection efforts.
Facebook CEO Mark Zuckerberg said on the company's second quarter earnings conference call:
GDPR was an important moment for our industry. We did see a decline in monthly actives in Europe, down by about 1 million people as a result. And at the same time, it was encouraging to see the vast majority of people affirm that they want us to use context, including from websites they visit, to make their ads more relevant and improve their overall product experience.
Facebook also noted that GDPR will be one of the reasons why revenue growth is expected to decelerate. Google said it was too early to tell how GDPR affects the company, but the search giant did note that it has been planning for the regulation well ahead of its effective date.
Warner's take on data transparency and money is interesting because it poses the idea that there's a lifetime value of your data calculation to be had. Warner wrote:
Legislation could require companies to more granularly (and continuously) alert consumers to the ways in which their data is being used, counterparties it was being shared with, and (perhaps most importantly) what each user's data was worth to the platform. Requiring that 'free' platforms provide users with an annual estimate of what their data was worth to the platform would provide significant 'price' transparency.
No kidding. That disclosure would also enable customers to put a value on their data and what they received in return. I noted previously that Google's data collection efforts didn't spur the Facebook-esque backlash because consumers got more in return. Simply put, if my data is worth $200 a year to Facebook I'm going to want more than better ad targeting in return. That return calculation is one reason Facebook's core product is under fire: There's not much in it for the consumer.
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But why pick on Facebook and Google? What's my data profile worth to third party brokers, ad marketplaces and various parties I visit.
Carry this out and any regulation that forces tech titans to disclose the lifetime value of consumer data will have a big impact. I doubt that the industry and regulators can agree on a standard calculation, but man such data transparency will be fun to watch.
Adjust these Facebook privacy settings to protect your personal data