People are increasingly becoming aware of the emerging ‘internet monopoly’.
Companies such as Google, Facebook, Twitter and the other (local) social network and media sites are becoming so large and powerful that they can dictate the use of their services in such a way that people lose control over their own information and their participation in these networks.
The services offered by these networks are very appealing, and they are an enormous contribution to the way people can communicate with each other. And, although we can point to some excesses in customer behaviour, by far the majority of users are responsible and greatly appreciate these new methods of communication.
Lack of a permission-based approach
While we did not foresee the arrival and success of these specific services, for over a decade I have been talking about ‘permission-based marketing’. We understood the potential of a combination of the internet-as-a-service and broadband as an access technology; and we knew that the combination of these developments would lead to an explosion in the digital economy and digital media activities. However, a decade or so ago we did not know how this exactly would take shape.
These digital media developments certainly did happen, but they are not founded on the ‘permission-based’ principles that we at BuddeCom advocated during all those years. We envisaged that the digital advantages should appeal to the users and that they would embrace these services; and we also envisaged businesses being able to make use of these developments, as this would allow for personalised and interactive marketing rather than the shotgun approach of ‘broadcast’ advertising.
We also believed that customers could benefit greatly from these services, as they would be able to receive messages that interested them, rather than being bombarded with a multitude of messages that were of no interest to them. That was going to be a win-win situation. This would lead to a much better customer experience and, given the technical attributes of these services, organisations could start building lifelong relationships with customers, based on personal and interactive communication facilities.
The internet of things
In our 'internet of things' reports and analyses we also mentioned the enormous advantages of linking databases together and providing better services to the users in relation to large number of issues such as weather, environment, events, shopping, travel information and so on – all targeted at individual users, based on where they are and what they do – again, fantastic applications and very useful, but also needing to be permission-based.
Users have no control over their own data
However, what we are seeing is that the social networks and digital media companies are indeed building all these fantastic services and applications, but they are not offering them on a permission-based footing. Their monopolistic position allows them to simply dictate terms and conditions to their hundreds of millions of users and the users have, in order to participate, only one option – to press the button ‘I agree’.
Through that one action users are unknowingly setting a range of processes in place, of which they have absolutely no understanding and, most importantly, over which they have no control.
Heaven for data-miners
Most employers now trawl Facebook and other sites for information on people that they are considering employing.
Through commercial arrangements with the social networking and digital media companies, businesses (and others) are obtaining access to highly personalised information that they can use to target people using these sites. In all, over two billion people can now be traced by these companies, many of which have linked their databases together for the purpose of commercial gain. Through linked data bases they are also allowed to further profile customers and make predictions. A good example was the recent case of Target in the USA making predictions about the likelihood of women being pregnant.
There is, of course, nothing wrong with commercial gain. On the contrary, access to these cost-free sites provides the user with great services. However, in my opinion personal data-mining on these social network and media sites needs to be based on user permission.
Another element that worries the European Union, and countries such as China, India, Russia and Brazil in particular, is that all of these services are controlled from one country – the USA. Privacy laws in the United States are among the most relaxed in the world and commercial organisations there have the freedom to use personal information as described above.
So what these companies are doing is not illegal in the USA.
Call for better internet governance
Unfortunately, in deference to the popularity of these sites, the internet monopoly that is emerging is forcing many countries to relax their privacy laws to line up with what is allowed in the USA; however the EU in particular is doing this most reluctantly.
In the end this situation is untenable. There is increased pressure to introduce better internet governance as the current organisations governing the internet take no responsibility in relation to these privacy and other social and cultural issues. Pressure is being put on international organisations (the UN) to take a greater role in this, a move that is fiercely opposed by the USA.
Organisations such as the OECD and UNESCO have also flagged these problems, calling for action before too much political pressure results in the imposition of severe restrictions – something that these organisations, plus many others, do not want.
Reluctance from social networks to come to the party
Even trying to discuss this with my American colleagues sometimes gets me into trouble.
We at BuddeComm certainly would not want to see heavy-handed internet control – and certainly not from countries like China and Russia. We are ardent supporters of freedom of speech and light-handed governance. Through our relationships with UN organisations we have tried to achieve some businesses consensus on how to best increase internet governance through industry self-regulation, but there is insufficient proactive interest from the internet companies involved.
They have certainly made some concessions, but with your ‘I agree’ click you generally provide them with full control over whatever information you publish on their sites.
Vulnerable user groups
BuddeComm is a heavy user and keen supporter of these sites, but we are mostly people with some life experience and discipline, based on lessons learned over the years. The majority of the social network site users, however, are young people and rather nave, and teenaged boys, in particular, are inclined to place information on the net that can easily be misused by others. Similarly teenaged girls can put unkind, sometimes vindictive, messages on these sites that they will probably regret if they read them five or ten years later.
Yet nobody has any control over their own information once they have clicked ‘I agree’. This feels wrong, it looks wrong, and it is wrong. And unless the digital media companies introduce permission-based concepts heavy-handed regulations will eventually be imposed, either by individual countries or international bodies.
We find it incomprehensible that companies like Google and Facebook are not pre-empting this and beginning to introduce these permission-based services – it would be in their interest to keep their fantastic services as free as possible from government interference.
And if the information is conveyed appropriately, and the benefits are well-presented and explained, most people will be willing to give up certain information in order to receive the attendant benefits – as long as they remain in control of their own information and that way that is used.
There may be some other developments that will make it possible to break, or to prevent, the internet monopoly.
New FttH networks based on a structural separation between the infrastructure and the services are going to make it possible to deliver parallel services over the one network. One could use an electrical power board as an analogy here – it is possible to plug different appliances into the same electricity network, independently of each other. A similar concept applies to structurally-separated super-fast broadband networks.
BuddeComm envisages that various organisations are going to provide their own services parallel to the ‘common’ internet. For example, the healthcare sector will run its own online system; so will the educational sector; and smart home concepts could see energy providers taking a similar approach.
This can lead to competing online systems all offered over the one national (FttH) infrastructure. So, for instance, schools who are now using Facebook to communicate between children and parents while on an excursion or school trip, or to display school work, will move to the education service, which will be delivered independently of the ‘regular’ internet.
This will be unlike the present situation, where all information shared between parents and children over Facebook instantly becomes public and accessible to the data-mining companies after the ‘I agree’ click.
These new technical developments will also lead to other ‘regular’ internet services – services that are not sector-related and which have a far more public basis – but which could specialise in certain public activities.
For example, there could be an ultra-secure network that will be used for banking and financial transactions. And it is not inconceivable that social networks may be moved to a separate network (or may be forced to use a separate network) in order to better provide privacy security of personal data.
A looming disaster for the internet
With billions of people now using social networks and social media it is clear that these services are benefiting societies and economies around the world. However, now that more and more people are becoming familiar with them and beginning to understand how they work, concerns are being raised about privacy and governance. I have no doubt that unless permission-based concepts are introduced heavy-handed regulation will be implemented, and that will seriously affect the whole concept of the internet.
This could be a disaster for the internet as we know it.
There is a technical solution to the privacy problem. However, I fear this will take too long to achieve, and in the meantime a number of horror stories will emerge that will prompt governments to take heavy-handed action. At this point this is avoidable, but unfortunately there are no signs that the social network companies are prepared to take a lead.
Paul Budde is the managing director of BuddeComm, an independent telecommunications research and consultancy company, which includes 45 national and international researchers in 15 countries.