Digging deeper on telco data

Telcos possess a treasure trove of customer internet usage and location data at their fingertips. So far they haven't really had the motivation to exploit it, but that may be about to change.

For many, the revelations around the PRISM and the NSA's data mining activities didn't come as a surprise.

You have to admire Edward Snowden's bravery in blowing the whistle on his former employer's activities, but, in all honesty, many probably assumed that the US government would be keeping an ever watchful eye on the internet after September 11.

So, if that incident didn't scare you into donning a tin hat, chances are you won't be too fussed about the fact that your local telco is collecting and storing just as much information about your digital footprint.

Internet use, location data, communications with others; all of this information is at the fingertips of the telcos.

So far they haven't really had the motivation to want to use it, but that may be about to change.

Each year, at its international InTouch conference, telco customer experience company Amdocs offers guidance to its clients as to where the industry is going. Last year, they rightly predicted that 4G would reshape the telco sector. This year, they're saying that 'Big Data' will completely transform the industry.

Amdocs' hypothesis is simple: if you know more about your customers you'll be able to offer them a more tailored, personal service. Given that all three of Australia's major telcos are jostling to win over consumers, and they're all customers of Amdocs, it's likely that they will listen - and perhaps even adopt - their message.

So what can we expect to see over the next couple of years? Well, one idea, according to Amdocs, is "proactive service", a dreamy concept where the telcos actually predict and offer a remedy your problem before you even know you have one.

Moving house into a network deadzone? Well, according to Amdocs VP of strategy for its CTO office, Eyal Felstaine, telcos can use location data to anticipate your complaint and send you a network booster before you even need to call in to say you have a problem. Confident on its findings, the company even predicts that this kind of data use will reduce call centre complaints by up to 20 per cent.

Even selling off your data to third parties can have its benefits. According to Amdocs Australia vice president, David Murray, companies want the ability to offer personalised targeted discounts, and this can only be enabled through allowing telcos to share their customer data.

It sounds like a rash idea, but consider this: is a consumer really going to mind sharing what they are doing for a 15 per cent discount on what they are already going to buy? Probably not. As Amdocs found in a recent study, most consumers are happy to offer their data for exchange for something. Less are satisfied about the idea of just surrendering it.

Big data, big problems

Amdocs went to a lot of trouble to present the glossiest scenarios possible when it comes to harnessing customer data. But recent history shows that sometimes harnessing 'Big Data' can sometimes lead to bigger problems.

After all, who can forget that US father who found out his daughter was pregnant through a targeted Target ad. The red circle department store really hit a bulls-eye there.

And the issue isn't just isolated to the US either. Telstra has a rather jaded history when it comes to how it handles and protects its customer data. The telco caused quite a stir last year when it attempted to ship its customer usage data overseas for the creation of an "internet filter". The telco really could have avoided that media storm if it simply told its users what it was doing and asked for their permission to do it.

This idea of "consent" really is the underlying issue here. As we move ever closer to an era where personal data actually becomes a form of currency, one can't help but think that many companies will opt to screw over consumers rather than offer them something fair in exchange for their information.

Perhaps one of the reasons why many were able to forgive and forget the NSA's data raid is because they genuinely believe that they are acting in the interest of national security.

As Edward Snowden passionately pointed out, there is the potential for abuse of power here, but that has well and truly proven the vast majority are happy (or more accurately, not fussed) about having their data examined by the NSA.

Between Amdocs' findings and the PRISM saga, there's a lesson here for this emerging data economy: it has the potential to be win-win for both consumers and companies, but only as long as those collecting the data are willing to play their part in keeping it honest.

Harrison Polites travelled to the InTouch conference in Singapore as a guest of Amdocs.

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