Lessig on privacy: economics, technology will drive data retention practices

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By: RickFerguson |

Posted on January 13, 2016

Marketers continue to pursue opaque digital data collection. Retargeting campaigns continue to dominate online and mobile marketing. The most recent Chango Retargeting Barometer report, for example, revealed that 80% of marketers surveyed agree that retargeting is a standard marketing practice. What if technology and the market itself, however, drives the marketing industry away from surreptitious data collection?

That�s the theory espoused by Harvard Law School professor and recent U.S. Democratic Party Presidential nomination campaigner Lawrence Lessig in an interview published on the Wall Street Journal�s CIO blog. Marketing. Lessig foresees a future when the cost of data breaches and the impact of privacy regulations make it uneconomical for companies to retain customer data. Money quote:

�The average cost per user of a data breach is now $240 � think of businesses looking at that cost and saying �What if I can find a way to not hold that data, but the value of that data?� When we do that, our concept of privacy will be different. Our concept so far is that we should give people control over copies of data. In the future, we will not worry about copies of data, but using data.�

Lessig envisions a future driven by technology such as Enigma, a blockchain-based cloud platform in which �Private data is stored, shared and analysed without ever being fully revealed to any party,� according to the Enigma web site.

While Lessig�s theory on the evolution of data privacy is technology-centric, another way that consumer privacy may evolve is toward a more permission-based model in which companies only retain data that consumers have explicitly authorized them to collect with the expectation of value returned in the form of recognition and reward.

One of the primary benefits of the traditional membership-based loyalty programme, after all, is that the customer data collection is permission-based. Unlike online behavioral targeting and programmatic ad-buying, marketing methods that collect and act on consumer behavior without (in most cases) their knowledge or consent, the data collection within the loyalty programme framework is explicit, transparent, and conducted within an environment of permission and trust. That�s the central theory behind the loyalty programme model�and it�s one of the main reasons why the model will remain durable in the face of technological and regulatory change.

The whole Lessig interview is worth reading; you can find it here (behind the WSJ paywall).

By Rick Ferguson

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