5Qs: Esther Dyson on Data

First of all, the rhetoric is changing, except among those wedded to the past, from privacy to “personal data control.” The kids using Facebook are way ahead of most of the industry; they know how to manage their data, whom to share it with, and so on. Of course, like kids and grown-ups everywhere and anytime, they can be clueless and careless. I suspect that in the future most employers will forgive an indiscretion or two simply because they won’t be able to find people without one. Of course, there are still huge security risks: witness the recent Epsilon and Playstation breaches. Life isn’t safe, whether you are crossing the street, flying an airplane, trusting a data center or storing your own information in a shoebox or a cell phone. People do need to understand the risks better, and that’s harder these days. It’s also hard to resist temptation: whether it’s a doughnut or a dollars-off offer.

I think “digital advertising” needs to morph fundamentally. Advertising interrupts; the new form of marketing shows up only for the person at the right time and place or device. Many of the requisite skills and approaches are closer to public relations –  reaching influencers, developing a message that will resonate and then letting users take over. Rather than a privacy threat I see a personal data opportunity. Instead of ads, we need sponsorship, where a marketer provides a valuable service, often around a consumer data-management application. One great example is Mint.com, which gives a user access to her own financial data from multiple sources. Others include Tripit and Worldmate, which uses your own travel data, and Sydeck which uses your cell-phone behavior; how many times did you call Mom and how many times did she have to call you? Unfortunately Skydeck pivoted into Mr. Number, but someday that functionality will be offered again, with enhancements. iTunes lets me manage my music, and a number of more social services let me share my data selectively with others. Another big area is health/wellness behavior. While some people are worried about medical privacy– and that’s a legitimate concern for some people– others are sharing selectively or more broadly on CureTogether, PatientsLikeMe, 23andMe and Genomera. I’m an investor in all but CureTogether. RunKeeper, FitBit, EarndIt and others let you compare your activity data with others. And of course a few lucky people including me have shared their entire genomes with the public at www.personalgenome.org.There’s nothing more sticky than your own data plus comparisons with your friends. And relevant offers/sponsorships on those sites are welcome rather than intrusive. I think in the future consumers will start to demand the ability to see their own data in understandable form. Providing that will be a huge business opportunity. So far, “disclosure” means a bunch of obscure, unintelligible privacy policies full of words like “may” and “including” and “notwithstanding” and “marketing partners.” But what people want to know is not what your policy is; they want to know what you know and whom in particular you share it with. If you can sell it to a marketer or an insurance company, why can’t you provide it back to me? This has been tried before, but I think the market is now ready for it.

I think the biggest issue will be the proliferation of “discounts” that will condition people away from paying full price while at the same time, many start-ups will discover how hard it is to run a real business — with effective support hotlines,  reliable logistics and the like. It’s so easy to start a business these days but it’s not that much easier to run one. It’s a real challenge to scale, and I think a lot of start-ups — and start-up CEOs — will discover that.

There’s room for great creativity if vendors get the basics right.