17 June 2013

Has the whistle been blown on the digital gameplan?

A whistleblower interrupts play in the digital world, again. Governments and corporations don’t like this one bit, but it’s part of the new reality. Recent events point the spotlight on a number of uncomfortable truths about the digital society, highlighting immense issues around personal data: its capture, security, surveillance; privacy of the individual; and state, commercial and criminal misuse.

While we embrace so many benefits of the mobile digital era, whistleblowers draw attention to the pitfalls and contradictions of an increasingly connected, always-on world. While we are grateful that Google led the way indexing the web, creating order out of chaos, we don’t like it much if service providers allow the US Government access to our personal data. With our phone’s location services switched on, this could include tracking where we were at 00.30am last Sunday morning (down to the last 5m). Does a government’s explanation that this is necessary to deliver safety from terrorists, outweigh the potential impact on personal liberty? What if it was a less than friendly government tracking you?

This just gets us thinking; Pandora is let out of the box. We start asking, who owns my data? Who else could access it? How vulnerable does this make me feel? Who can I trust? Who is accountable when things go wrong?

At the heart of the issue is that in the world of Big Data every communication and digital interaction can be recorded, stored, retrieved and analysed years later. The more websites and apps we use, the ‘richer’ the data trail becomes. If you or even your children have ever searched for a sensitive term - like ‘jihad’ - you may already be on a hot-list. Whether we like it or not, our lives are now recorded. Big Data, we realise, brings us face-to-face with Big Brother.

Should we be bothered?
Some, for now, remain distinctly unbothered; others are looking at the consequences. Principles are at stake. At what point is it acceptable to intercept your telephone calls or internet traffic? For some ex-News International management, there is a prospect of going to jail for being behind this kind of thing; but how many more have got away with it?

Forget governments for a minute. Are we comfortable with thousands of businesses collecting personal data about our internet habits and personal preferences; and then selling it on to others who already know the value of our houses and the sizes of our mortgages?

For us to feel at ease, we need an important question answered “who is setting the boundaries?” We need to know who the legitimate overseers of business and government agencies are, and who, if anyone, oversees them? Do they know what they are doing? Are any of these regulators or individuals really accountable to us? In a democracy, these are important issues.

What seems clear is that legislation and regulation is confused and behind the curve. UK Government has a Digital by Default policy, which is delivering huge savings and efficiency gains for government departments by e-enabling government services. At the same time, it is party to ridiculous EU Cookie laws, which, while probably well intentioned, only serve to show how out-of-touch regulators are with the way digital society and digital business does business.

Perhaps this Big Issue requires a much wider philosophical and ethical debate to be had, now that we are beginning to understand the consequences of living in a world where pretty much everything is measured and stored in a vast cloud of data that, from time to time, can shower acid on those below. What we really need to avoid is a data monsoon.

The future is connected
Many of us have more than one smart device: a laptop, a smartphone and maybe a tablet. Soon we will be wearing tech, watching connected tvs, and paying for things with contactless smartcards and smartphones. This is what we at Nucleus call the Connected Age. Sounds great, but with instant access over superfast broadband (the whole of Singapore already has free 1GB per second access) and content in the cloud, all these devices will create a data trail that government will want to monitor, business will pay to access and criminals will aim to intercept. Well intentioned, but without the right controls it has many of the attributes of an Orwellian world.

We should have seen this coming. Already, quite a few corporations are valued on the basis of the number of customer accounts they have and how much they know about their habits and preferences. Facebook’s potential to ‘monitize’ its billion or so members was key to its bloated IPO valuation and its failure to convince that it could do so in an increasingly Mobile era was probably why its stock dropped so quickly.

Illegally ‘harvesting’ customer data, whether it is hackers getting hold of credit card details on an ecommerce site or cloning NFC identities on a crowded train are now very real threats to us all. Cyber crime is particularly difficult to address, because smart criminals are using customer details to ‘skim’ small sums from thousands of individuals’ bank accounts and credit cards, so 1) it’s less noticeable, and 2) police don’t follow up on what they see as minor fraud. But it is going to be anything but minor.

Beyond cyber crime and cyber wars, consider what might happen if some global event, say a huge geomagnetic solar storm, wiped out some or all of the world’s digital data? We have all lost documents, but what would be the consequences of data loss on a massive scale? In Hari Hunzru’s latest book, Memory Palace, that’s exactly what happened, creating a dystopian world where the collective human memory is lost. It’s an eerie thought.

The risk to business of sloppy security or equivocal ethics
Back to business, how long will it be before a really well-known brand loses or misuses its customer data on a grand scale and a whistleblower discloses what happened? Or industrial espionage leads to a company in another country stealing data and using it outside the laws of the land? This is not a matter of if, but when. It might have even happened already, without a whistleblower drawing our attention to it, yet.

Have brand owners considered the impact of this on their brand value? With the world’s most valuable brand valued at $185bn for its brand alone, literally hundreds of billions of dollars are at risk.

Extreme solar storms apart, all the rest distills down to one little word; a simple noun, that is hard to earn the right to use, but very easy to lose: Trust.

When it comes to data, we need to be able to trust our governments, our service providers and the brands we choose to associate ourselves with. We need to trust them to operate within well-defined digital boundaries that are designed to protect us without exploiting us, while protecting us from evil.

Defining these boundaries and regulating them in a democratic way is only now becoming a matter we care about. Data privacy is a complex and difficult set of issues with many onerous implications, which whistleblowers have spotlighted, but as it will affect us all we should be prepared to participate in a debate to define standards and rules we can sign-up to.

In the meantime, every brand should be thinking seriously about its customer data: how it collects it, what it uses it for and how it protects it. In a digital society, if your brand is not trusted by customers, it won’t be long to the full-time whistle.

On the other hand, Trust is a great brand proposition…
 


Peter Matthews

Nucleus Founder & CEO
June 2013

Agree? Disagree?
Share your views by emailing horizons@nucleus.co.uk

Mobile web browsing leaps to 27.1% of travel website traffic
Mobile web browsing leaps to 27.1% of travel websites traffic
Has the whistle been blown on the digital gameplan?
Has the whistle been blown on the digital gameplan?