Privacy vs. Data: How to build consumer trust?

By Gary Schwartz

The way we define the term privacy is subjective. In the United States, we police privacy based on a very broad definition under Section 5 of the Federal Trade Commission Act that prohibits “unfair or deceptive acts or practices in or affecting commerce.” The devil is in the policy details.

If the news headlines over the past few months are any indication, we are mighty confused with what to call private and what to call public, what to sanction and what not to sanction. How can we start to solve small-screen privacy when we have not solved our digital angst on the desktop?

Jules Polonetsky, director of the Future of Privacy Forum, says that when the browser invariably crashes it pops up a commiserating dialogue box asking you permission to send the diagnostic report to the browser company anonymously to help them fix bugs and build a better browser.

Faced with this privacy brief, only 3 percent of users click “Yes.”

Digital natives

Is it because we are digital immigrates? Our children happily offer data everyday about personal activity without hesitation.

Is the challenge simplifying the legal narrative to allow consumers to make an informed decision without interrupting their next click on the small screen? It seems an improbable feat.

In March, the Federal Trade Commission issued a report on best practices for businesses collecting personal data called “Protecting Consumer Privacy in an Era of Rapid Change: Recommendations For Businesses and Policymakers.”

The FTC, which is taking a proactive lead on privacy in the beltway, seems cognizant that it needs to create a flexible framework to best interpret what is unfair or deceptive in Section 5 of the Federal Trade Commission Act.

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The cost of the digital consumer: Instagram vs. YouTube

At $33 per user is Instagram a bargain?  YouTube was purchased at $1.65 billion with undeclared but estimated low revenues. The cost-per-user was just north of $50.
However, we know that Google bought YouTube to develop a niche video portal. (A portal that in 2006 was demonstrating an average user time spend of fifteen minutes each day.) Online video was the new frontier and Google made YouTube one of the pillars of its advertising empire and matured the property slowly. Presently YouTube direct content and the YouTube partnership network supports the lions share on online video time spent in North America.

Instagram provides eyeballs – 30 million; however, is the application indispensable, sticky and can Facebook grow the property slowly to extract the value?  Instagram’s global user base spend their time cropping and filter images to make them look upload worthy.

Acquisitions for eyeballs has not been a big win for many buyers. What is the long term content play for Facebook. Is Instagram a mature building block for Facebook or is it a pre-IPO market postioning story?

Girls Around Me: An issue of privacy and trust!

By Gary Schwartz

Why the shock and awe of a mobile application that helps guys find girls around them – an app which uses publicly available data from Facebook and foursquare’s APIs, data which is completely permission-based?

Well, the “GirlsAround.Me” app, understandably, riled the press. The Cult of Mac blog’s headline reads: “This Creepy App Isn’t Just Stalking Women Without Their Knowledge, It’s A Wake-Up Call About Facebook Privacy”. CNET’s op-ed reads: “Girls Around Me and the end of Internet innocence.”

However, the “Girls Around Me” app is simply another in a long list of controversial services that use information that is floating about the digital commons.

The Russian company, i-Free, that developed the app cannot understand the kerfuffle, claiming that it has been used as a “scapegoat” for the privacy debates whirling about Washington. Honestly, it has every right to be confused.

The industry itself is confused and responding to privacy in reactive knee jerks instead of thoughtful best practices. The problem is the complexity and sensitivity of social data. Combining location check-in with social graph is a potent privacy cocktail.

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Smartphones let retailers target deals to shoppers (CNN)

Los Angeles (CNN) — Your smartphone might help retailers to be smarter about your purchasing habits and even let them send you targeted discounts while you shop.

Mobile marketing is an essential tool for the retailer in the next two years, said Gary Schwartz, the CEO of Impact Mobile, a mobile-tech firm. He said nearly half of all cell phones in use today are smartphones, the kind necessary for mobile marketing. In two years, that figure will jump to 70%, he said.

You can register with a retailer and sign up for alerts, text messages or other notifications about special offers and sales. The retailer then can keep tabs on your shopping and spending habits and lure you into their stores.

Schwartz said it’s quite possible that smartphones will help boost sales and in doing so, help lift the economy.

“If they’re used in a smart way, it will absolutely drive sales,” he said.

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