Paying for Digital Privacy

One of the many unfortunate fallouts from the recent hacking scandals is the harsh realization that privacy in the age of the Internet is now essentially gone. Some may argue it was never there in the first place but regardless, it’s clear today that things you do online—whether in email, instant messaging, social media or web browsing—are but a few clicks away from being exposed for all the world to see.

Scary thought, isn’t it?

At the same time, we all fundamentally know there is a very real need for privacy—some things should only be shared with their intended audience. So, how do we overcome this rather critical dilemma?

Unfortunately, it’s become clear to me that digital privacy is quickly evolving from what should be a right to something that looks more like a privilege—a privilege I think we’re going to end up paying for. Don’t get me wrong, I’m not endorsing the concept—but at this point, I’m afraid it’s inevitable.[pullquote]Unfortunately, it’s becoming clear to me that digital privacy is quickly evolving from what should be a right to something that looks more like a privilege—a privilege I think we’re going to end up paying for. “[/pullquote]

Just as some people choose to spend extra money to live in the supposed safety of gated communities in the real/material world, so too will we see some people willing to pay to take refuge within digitally gated communities in the virtual world. We’ve already seen the introduction of services that attempt to repair the online reputations of individuals, but I think this is only the tip of the iceberg. I fully expect to see companies create services that essentially act as digital bodyguards as you make your way around the internet.

Ironically, in order to do that, they’re probably going to have to follow everything you do online more closely than even our current nightmare scenarios of digital identity theft might lead us to dream up. The difference, of course, will be all about trust. A truly discrete and trusted digital protector could, in theory at least, enable the kind of protection I’m describing. But the level of trust necessary to pull this off is far beyond anything I think we’ve ever seen in the digital world and it’s not immediately clear to me who could provide it…. An eager startup? Not likely. A major OS or online platform provider? Maybe.

Regardless, the introduction and evolution of a digital privacy service is bound to raise a number of very important, very fundamental questions. Who can have access to this? Who should have access to it? For the naively optimistic, why is it even necessary?

People are going to (and should) expect some degree of privacy in their lives and, as more of their lives move online, those expectations are bound to move online with them. The challenges of hacking and digital privacy invasions are not going away and, unfortunately, are likely to get much worse. This makes the need for digital privacy services even more important. There are still big questions that need to be discussed, however, and new policies will likely need to be implemented to help address what I think will be one of the biggest challenges of our era.

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Bob O'Donnell

Bob O’Donnell is the president and chief analyst of TECHnalysis Research, LLC a technology consulting and market research firm that provides strategic consulting and market research services to the technology industry and professional financial community. You can follow him on Twitter @bobodtech.

13 thoughts on “Paying for Digital Privacy”

  1. I think the issue is multifaceted.
    First, privacy and security go hand in hand. Reassurances of privacy mean nothing if a script kiddie or a determined profit-motivated (or other) hacker, can hack my “private” info in a few hours. Users, corps, and gov are being incredibly careless about security.
    Second, the gated community model probably doesn’t work because of network effects and user education. Living in a gated community doesn’t prevent you from inviting friends over. Using secure messaging, which has been available for free for decades, does prevent you from sending your drunken party pics to all involved.
    Third, assigning a price goes both ways: not only may some users be willing to pay for privacy and security, but also there should be regulations for handling and fines for losing data, same as for straight up money. Technology is not a deus ex machina, economic incentives have to be aligned, and when the issue is both complicated and too involved for individuals, legislation is the ultimate form of collective bargaining.

    1. Yes, it is a complex issue and, as I suggested at the end, I do think legislation of some sort is likely to be necessary. As for the gated community, of course, I meant that completely virtually–really it’s about gating yourself as you wander around the web. Hence, my concept of a digital identity bodyguard. But underlying that are some serious questions about the need for such a service…it’s about bringing some degree of order to the essentially unrestricted chaos of the Internet today.

      1. “…really it’s about gating yourself as you wander around the web.”

        Bingo. Well-written and depressing article. Thanks.

  2. I for one am more than happy to pay Apple for their iPhone or Apple Watch so I can make private transactions. Happy to pay for that. So are many others. Network effects of Apple Pay are absolutely huge.

    1. Chris, yes, arguably paying to be in the Apple ecosystem is somewhat analogous to the “gated community” analogy I used in the column. As long as Apple maintains their stronger security profile, you’re in essence paying more for that security.

  3. I pay for email. I don’t use Gmail. I don’t use Google for anything while logged in. I mostly don’t even use it for search. I’ve never used Facebook. I keep my online profile as low key as possible.

    I don’t think I’m paying much for enhanced privacy. I have an iPhone which has slightly better privacy that Android. Fast mail costs $40/year though I could probably get by with their $20/year plan. Not using services that monetize their users is just not that hard nor particularly expensive.

  4. Do you have any data, surveys for example, that demonstrate that the general public is getting more aware of privacy/security issues?

    Or do you have any data showing the rising popularity of services that have privacy as a core feature, to the extent that it will become significant in the near- to mid-term?

    The issue of privacy has been brought up before (the Microsoft Scroogled campaign for example), but to my knowledge, there has been little consumer interest. Are there any concrete indications that things are different this time around?

    1. No hard data, but unquestionably a sense of greater concern as it starts to impact more people directly and as bigger and bolder attacks get reported in the press.

  5. Trust is certainly key. Consider the whole AdBlock scandal where they sell data to advertisers. It is too tempting to be the protector of something and to then sell access at a high profit to those who want access. That is the history of the world.


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