Such thinking is common in writing about Google and Facebook. Tropes such as “you’re not the consumer, you’re the product” are repeated ad nauseam. The idea is the same. Since Facebook and Google do not charge us for services, it’s said we pay through giving up our information, in turn sold to third parties for well‐targeted advertising.
So entrenched is this belief, a Financial Times editorial this week advocated overhauling competition laws to acknowledge that “digital services increasingly cost long‐term privacy rather than money”.
Whoa, there. Before good policy is sacrificed to this meme, let us pause and reflect. Yes, Facebook and Google make money through information‐infused advertising targeted at granular user populations. But there’s nothing new about this practice. Nor does it follow that users are “the product” or that privacy is “the cost” of digital services.
Journalists, of all people, should understand this. Free newspapers and free‐to‐air broadcasters, such as ITV and Channel 4, have similar business models. All seek to capture readers or viewers by providing good quality content.
Generating these large audiences is necessary for their advertising space to generate revenue. Media companies must profile their readers or viewers, pitching this demographic information to would‐be advertising buyers. Yet, strangely, nobody says ITV viewers or Metro readers are “the product” or a “commodity” of the companies.
True, TV networks and papers don’t collect much individual level data or enjoy the scale of information of Google or Facebook. Yet this is a matter of degree, not principle. One senses the teeth gnashing comes precisely because tech has disrupted the traditional media’s approach.
Advertisers on Facebook can now target ads at 35 to 40‐year‐olds, living in the Medway towns, who are interested in water polo; obtaining real‐time feedback on the ad’s success. That obviously helps maximize the effectiveness of ad spend. None of that makes our data “the product” or privacy “the cost” of Google or Facebook though. In fact, there are three clear reasons why such claims are misguided.
First, and most obviously, the value of these firms’ advertising space is dependent on strong user numbers. Google must deliver an accurate search engine, and Facebook high‐quality networking and applications, to keep us using their websites or apps. That provides an incentive to respond to our wants and needs, including on privacy. We might not be paying customers, but we are much‐needed consumers.
For now, these firms are successful. Alternatives are just a click away with Yahoo, DuckDuckGo and Bing but Google still has an 88pc UK market share in internet search. Facebook is currently the largest UK social media site in terms of reach, consumption and revenue. The point though is we aren’t powerless pawns here; we willingly use both because we like their products. If that changes and user numbers collapse, so will their business models.
Second, perhaps less obviously, much “data” commonly described as “ours” is actually the creation of Facebook’s own structure and processing. Writing out your personal details, friends list, and upcoming social events on a sheet of paper might have some inherent value to certain companies, but it will be relatively small.