WASHINGTON—You’re probably one of the 91 percent of American adults who think they’ve lost control over how their personal information is collected and used by companies (according to a Pew Research study in early 2015). But big data collection brings benefits that outweigh the potential downsides, contended Ben Wittes, a senior fellow at the Brookings Institution, in a recent panel discussion held by the Software and Information Industry Association at the U.S. Capitol Visitor Center.
Consumer concern about online privacy is at all-time high due to e-commerce and mobile devices, which both collect wide swathes of consumer data, the Pew Research study says.
However, people who worry about “privacy eroding into the river and being gone forever,” said Wittes, ignore how those benefits actually increase privacy.
The rise of online sales has meant you can mail-order products that might be too embarrassing to buy in person, Wittes noted. “Without looking at somebody in the eye, without confessing the interest in this subject, you get what you want.”
Because all ebooks look the same on an e-reader, for instance, you can read Fifty Shades of Grey on your Kindle without shame—which may explain why the e-version of this book has outsold its printed version.
The value of the privacy of those purchases, Wittes argued, outweighs the value of the data given for them—like email, credit card numbers, browsing history, personal preferences, and location-based information.
Wittes suggested changing vocabulary that consumers use to describe the benefits they get with giving up some personal information. It’s not only “convenience,” he said, “it’s also privacy benefits.”
Joshua New, policy analyst at the Center for Data Innovation, said data collection also brings economic benefits to consumers.
He cited car insurance as an example. Instead of deciding your insurance premium based on broad factors—for instance, age, gender, neighborhood—drivers could use data to prove they’re good drivers even if they fit into a high-risk section based on traditional measurements, New said.
People who strive for online privacy should be aware of the conveniences they sacrifice. Adam Thierer, a senior research fellow at George Mason University, said it’s not impossible for people to protect their privacy if they don’t mind losing the benefits of giving up their data.
“Companies can offer paid options where user information won’t be collected,’ Thierer said. “But at the moment, I don’t think many people will pay for their privacy.”
A balance between consumer privacy and technology innovation is what the Federal Trade Commission is pursuing. Totally prohibiting data collection, which will create barriers for breakthrough innovations, is definitely not the solution.
“We should definitely limit the use of data,” said Federal Trade Commission member Maureen Ohlhausen, “but not limit the collection of data.”