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Trust issue looms large for tech companies capitalizing on personal data

Marc Ferranti | March 7, 2014
Privacy issues may cause a stumbling block for companies capitalizing on a growing stream of user data.

Facebook faced fierce criticism and a class-action lawsuit in 2011 when it introduced the "sponsored stories" feature, which showed a user's profile photo near an advertisement if the user had "liked" the brand, Little said. Facebook's privacy policies continue to be subject to close scrutiny.

Increasing user resistance to exposing personal data and Internet use habits to such tech giants has created an opportunity for other players, Little said. One such example is DuckDuckGo, an Internet search engine that does not profile its users, Little said. Other examples cited by Little include Epic, a Web browser that ensures that session data such as cookies and history are deleted when a user exits the software; Snapchat, the photo-messaging service that deletes images from its servers once they are viewed; and the Mydex Personal Data Vault, which allows users to collect all their personal information in an encrypted storage space and manage how third parties such as online services can access the data.

Aggressive vendor exploitation of big data -- the use of business intelligence software to analyze massive amounts of data collected from various online, mobile, point of sale and other sources -- will only serve to increase interest in services that profess to allow people control over how their data is used, Little said.

The big data phenomenon is only going to get bigger, as network-connected sensors are incorporated into devices, such as thermostats, that in the past were stand-alone appliances,

industry representatives said at MWC. This trend has been called the "Internet of things," (IoT) and was much discussed last week in Barcelona.

By connecting devices over the Internet and wirelessly over mobile networks and analyzing the data that can be collected this way, companies can manage a wide range of new services for their customers. This is why Google announced in January that it would pay more than US$3 billion for Nest's smart thermostat and smoke alarm technology, multiple tech executives pointed out.

"It's inevitable that every business will become an IoT business," said Jahangir Mohammed, CEO of Jasper Wireless, in an MWC keynote address. "IoT transforms businesses that are [about a] product, into products and services."

From all the talk and some concrete product offerings announced last week, it appears that tech vendors and telecom companies are starting to realize that to successfully monetize subscribers' data they need to first earn far greater trust from them, Ovum's Little said. Ovum calls this approach "Big Trust," he noted.

An announcement from Swisscom and WiseKey is an example of this approach, Little said. The companies announced a partnership to provide Trusted Encrypted Personal Clouds stored in Switzerland.

 

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