Research. How is commercial digital profiling and data-driven algorithmic decisions affecting equality, freedom, autonomy, democracy, and human dignity on both individual and societal levels. With this in mind, a new report from Cracked Labs focuses on the actual practices and inner workings of today’s personal data industry and explores relevant recent developments.
It all started with the airlines loyalty programs in the 1980s, retailers followed suit in the early 1990s, and the financial services industry in the late 1990s; today companies in virtually all industries run such programs – often in coalition and some of them sell aggregated froms of consumer purchase to research companies and data brokers. And it is not only in the US, e.g. British Tesco, Spotify, media houses and German Sociomantic are in the game, according to the report. The largest players are Google, Disney, Comcast, 21st Century Fox, Facebook and Bertelsmann.
The report does not predict the future of the personal data industry but states that business consultants such as Gartner advise companies in all industries that they must join the personal data economy, that they should collect as much data as possible about their customers and prospects, and, of course, that they also should find ways to reap the benefits of these riches. It underlines that The US legal and regulatory framework has enabled the growth of this data driven world without any effective consumer safeguards, but that the coming EU GDPR might have a global impact.
The report also looks at the finance industry and fraud prevention but especially the chapter on the data brokers (‘The Marketing Data Industry’) is interesting. A data broker can be defined as a “company or business unit that earns its primary revenue by supplying data or inferences about people gathered mainly from sources other than the data subjects themselves”.
Data brokers collect and sells list of people e.g. suffering from cancer or depression. In 2017, Amnesty International was offered a list of 1.8 million US Muslims. Some data brokers even provide software to manage their client’s customer databases, where every person gets a unique code. Even in German, the data broker Arvato AZ Direct provides 600 attributes on 70 million consumers in Germany, assigning every person, household, and building a unique ID, according to the report.
Just to get an idea about the numbers: Data broker Acxiom manages customer databases for 7,000 clients, including 47 or the Fortune 100 companies. Experian manages 7,500 customer databases of large companies. Merkle states that it manages more than 3.7 billion customer records for clients, including for Dell, Nespresso, Microsoft, Marriott, Chase, American Express, and Universal. And Arvato “maintains relationships with over 600 million consumers and business clients” on “behalf of its clients”.
One of the biggest data brokers Acxiom get a lot of attention in the report. And it shows how far the data industry is going in the US with so many different suppliers of data; Ibotta (mobile purchase data), Freckle IOT (real-time location data), Samba TV (second-by-second tv-viewing), Crossix (healt data on 250 mio US citizens), Google, Facebook, Twitter and so on.
The report states that;
Based on data and guided by their business interests and economic goals, companies have constructed an environment in which individuals are constantly surveyed and evaluated, investigated and examined, categorized and grouped, rated and ranked, numbered and quantified, included or excluded, and, as a result, treated differently
The consequences of the massive use of personal data can be that individuals are singled on false reasons; they might get flagged as suspicious and warranting special treatment or investigation – or they may be rejected without explanation or even knowing when applying for a job, a loan, an insurance or a data.
The report concludes that:
Besides additional regulatory instruments such as anti-discrimination, consumer protection, and competition law, it will generally require a major collective effort to make a positive vision of a future information society reality. Otherwise, we might soon end up in a society of pervasive digital social control, where privacy becomes – if it remains at all – a luxury commodity for the rich. The building blocks are already in place.