CyberScout

Why privacy is more expensive than Google would have you know

Privacy law

The whole "Privacy is dead/Long live privacy" jam is alive and well, and increasingly consumers know whodunit. A quick look at recent stock values of Google, Facebook, and Amazon (among many others that offer "free" products and services for consumer data) tells the tale best. But there is another side of the story--one that involves small- to medium-size businesses and blue chip enterprises alike--that garners less attention.

The small yet growing segment of internet users calling foul are now a regular feature of the online media landscape--call it retail privacy, or the business to consumer version. Apple co-founder and tech folk hero Steve Wozniak has calledfor Facebook users to close their accounts over privacy concerns. Washington Post columnist Geoffrey Fowler similarly recommended switching from Chrome to Firefox, referring to Google's Web browser as "spy software" and to Google as "the Web's biggest snoop of all." Privacy-centric DuckDuckGo, an internet search engine that protects user privacy and doesn't personalize search results based on past searches, location data, and the like, has seen its traffic grow exponentially year after year (while it still pales next to Google's market share).

Although it's still way too early for privacy advocates to take a victory lap, it is important to bear in mind just how quickly the internet landscape can change, and just how long it takes for culture to catch up to new situations and learn how to avoid the snares they create.

Twenty years ago, Facebook didn't exist, Google was a perky dorm-based startup with the not-yet-ironic motto, "Don't be evil," Amazon was an online bookstore headquartered on the same street as a needle exchange, and Apple was a scrappy underdog in the shadow of Microsoft. Demand for a more privacy-centric internet isn't guaranteed, but it also shouldn't be ruled out as its next evolutionary step. Apple, for one, is betting heavily on it.

But while this seems to be the next phase of consumer entrapment for the leviathans of data sifting, businesses are not able to opt out and stay relevant.

Re-establishing privacy

The biggest challenge in resuscitating privacy isn't that it's difficult for consumers to opt out of invasive online services, it's that it's nearly impossible for businesses to do so (and I only say "nearly" here by way of a hedge). Case in point: Steve Wozniak's aforementioned recommendation to leave Facebook was initially posted to his own soon to be deactivated Facebook account. Despite his misgivings, it was the best platform to communicate with other Facebook users. Firefox may provide a compelling alternative to Chrome, but its parent company still receives a large part of its funding from Google itself as payment for making it the browser's default search engine. An online retailer may be able to carve out a niche separate from Amazon Marketplace, but would still most likely rely at least partially on Amazon's cloud services, which dominate the market.

But while businesses may be able to figure a way to do without Amazon or Facebook, Google is unavoidable. Starting off as a superior search engine, Google has gone on to not just corner several consumer markets (Android phones, Google Maps), but also to position itself in such a way as to make itself indispensable, and unavoidable, for businesses.

The first and perhaps most important area Google has conquered is search. By creating a superior search engine, Google was able to create the terms of engagement, letting businesses know (some but not all) of what needed to happen on their end to make themselves "visible" on Google searches. What they needed to have involved, among other things, a data taxonomy that was built to work best in the Google search environment, and as a result, Google got to know more about a company than was probably proper.

Likewise, Gmail and Gsuite offer a very robust mail tool with cheaper, better spam protection and significantly fewer security gaffes. However, this allows Google access to everything that passes through it--and anonymized or not, this is a privacy grab. Increasingly, small- to medium-size businesses use Gmail to power their communication. There is an opt-out, but it is costly, and many organizations are still willing to trade privacy for inexpensive services.

Chrome isn't actually "spyware," but it does collect a significant amount of data, and it has gained market share by simply being good, which brings us to analytic. Google Analytics provides companies with metrics to determine the relative success of their website performance against other companies. There really isn't anything analogous to it in terms of free, quick access to website data and performance, especially since it only requires a few lines of code. Meanwhile, it provides Google with a ton of data about companies using the service.

Let's not lose sight of why Google has access to this data: It offers the best tools and services out there. It typifies the "build it and they will come" approach to business success.

While there are privacy-minded alternatives for consumers, we need cost-effective solutions to be able to provide secure, non-invasive services to businesses, which probably means weaning the world off of "free."

The good news is, demand for privacy-for-pay seems to be growing. The bad news is that, until quality alternatives are able to compete with Google, businesses are going to find themselves paying dearly for their "free" services.

About Adam Levin   |   Chairman and Founder   |   CyberScout

Adam Levin Chairman and cofounder of Credit.com and CyberScout.com. Adam’s experience as former director of the New Jersey Division of Consumer Affairs gives him unique insight into consumer privacy, legislation and financial advocacy. He is a nationally recognized expert on identity theft and credit. Have a question for our experts? Email them at CreditExperts@Credit.com.