With all the recent privacy scandals, the best way to improve the industry may be to cut out the middlemen altogether and connect users and advertisers
Given the events and news stories broken over the past year, there’s one topic that remains on many consumers’ minds: privacy. Facebook caught everyone’s attention at the beginning of the year when news broke of data abuse by Cambridge Analytica and other third parties harvesting and data mining on one of the most popular social media sites in the world. In more recent news, the platform confirmed that millions of users had personal data accesses during a security breach. Now social media users everywhere want to know what the answers are to their privacy concerns. Let’s take a look at what went wrong and how the industry can improve.
A Tale of Centralization
If we look at Facebook, Twitter, Google, or any other mainstay in the tech sector, we see that many platforms are organized in a similar, centralized manner. Since these large tech companies earn money by connecting advertisers and users, they store a tremendous amount of data on their users (and even on those who don’t use their platforms). With that enormous amount of data collected, these social media providers can offer targeted advertising the likes of which the marketing world has never seen before. That’s fantastic for both advertisers and those running these lucrative platforms.
However, there’s a dark reality that comes with the advancements in targeted advertising and marketing. To keep up their stellar ability to provide advertisers with effective marketing tactics, these companies store and keep tabs on all of their user base. Though user data is not directly shared with advertisers, the retention of such data in a centralized manner is not the most secure solution for users. Besides the Cambridge Analytica revelation—which shed light on inappropriate data utilization behavior, but not an actual security breach—there are many examples of breaches on these systems that result in third-parties accessing user data. We recently saw this with Facebook, and now are hearing about the fatal security bug that’s led Google to close down their already-desolate Google+ platform. But what can be done?
Decentralization and Cutting out the Middlemen
In all of the cases of social media platforms offering advertisers access to their user bases, there’s one thing in common. Regardless of the platform, advertisers are interested in the users themselves and the data collected on them. In the current social media model, users get access to the platform for free. That’s not because tech giants like Google and Facebook are altruistic though, it’s because the users are the product; that’s how platforms make their money.
With the current structure, users have to rely on these large companies to handle their personal data responsibly and securely. Unfortunately, though, we’ve already seen that this isn’t always what happens. That’s why there’s a growing trend taking a new approach to user data and sharing it with advertisers.
New initiatives in the tech sphere are decentralizing the system by putting control in the hands of users, rather than in big tech platforms. Rather than handing over data to be stored and used by large centralized systems, here are some of the players making decentralized data happen.
One of the largest names in the data sector is Datacoup. Chances are, many have likely heard of the company and its data marketplace. Datacoup believes that users should be the primary beneficiaries of their data being used and enables users in the US to get paid for their data being shared.
While Datacoup is a step in the right direction (by allowing users to benefit from selling their data, rather than only the platforms), the system is still centralized. Though it’s not Facebook or Google, Datacoup is still running a database with all of their users data stored in it. That leaves risk for a security breach and the compromising of a middleman.
Along with Datacoup, there are more decentralized solutions coming for users as well that solve the middleman dilemma. In contrast, Zinc is a new blockchain-based system for users to capitalize on their data. As with any blockchain-based projects, decentralization is at the heart of the initiative. Zinc offers users a platform to share their personal data and attention—and get rewarded for it—without all of their information being stored and controlled by a middleman. The new platform offers users a way to connect directly with advertisers in a way that benefits not only users, but advertisers as well.
The Future of the Data Industry and Security
All the tales of security breaches, misuses of personal data, and the complete lack of benefiting from your own personal data being used as a product has lead consumers to start questioning the current model. Rather than allow for large companies to collect vast amounts of personal data and capitalize off of it, users are taking concerns of privacy more seriously.
Along with those privacy concerns, users want to see the benefits from their personal data in use as well. As the advertising industry continues to develop in the increasingly online world and user data becomes even more desirable, decentralization looks to be one of the best options for advertisers looking to access first-party data and the users looking to capitalize on that data. By effectively cutting out the middleman, users can worry less about the security of their personal information and advertisers can purchase the data they want directly from the sources they’re interested in.
Image source: Pixabay
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