How Blockchain Will Enable The World's First Equitable Data Economy

By Charles Silver, CEO of Permission.io 

If browsing the internet doesn’t seem as fun as it did in the past, that’s because it isn’t. It’s work. 

In our data-based economy, interacting on social networks, filling out surveys, reading news stories online and clicking the Buy button on e-commerce sites all count as “data labor,” according to a range of economists, universities and other organizations surveyed by MIT Technology Review and Omidyar Network.

This labor produces one of the most valuable social and economic assets the world has ever known: data. Its transformative power for businesses makes commodities like gold or oil seem passé. Seven of the ten largest companies in the world by market cap are tech companies, most of which have reached this stature by leveraging and exploiting consumer data.There’s nothing wrong with this picture, except the fact that consumers are not getting their cut. 

Governments are also major contributors in the data economy. Increasingly, they are seeking a bigger piece of it, as they want more data to inform a range of policy decisions and to share in profits that are jealously guarded today by the tech giants. 

Globally, governments are implementing policies to make the data economy more transparent through initiatives like GDPR and CCPA, to name a few, and in response, the private sector is also mobilizing, paving the way for new business models that empower individuals over tech monopolies.  

A Look at the Data Economy

To get a sense of just how massive the data economy has become—and how much technology companies make from it—consider the following statistics:

In 2019 alone, Facebook made $29.95 billion in net U.S. ad revenue from about 231 million North American users. Last year, with more consumers spending time at home and online, that sum was $84 billion.

Google’s ad revenue jumped to $147 billion last year, which means hundreds of millions of dollars per day. The company is expected to command nearly a 29% share of digital ad spending globally in 2021. While the company earns money in a variety of ways, it primarily earns on the back of users’ Google data.

The government is also a big data harvester. Federal, state and local agencies collect and store user data in the form of demographic information, motor vehicle and driving data, professional and recreational licenses, voter registration records, and court records. Some of it the government sells. For example, the state of California makes about $50 million a year from motor vehicle and driving data, which it sells without a word to California’s millions of daily drivers. Other states do the same.

A variety of other organizations also collect and sell personal data, including credit rating agencies, healthcare businesses, schools and colleges, magazine publishers, airlines, job search companies, and more.

Various parties are benefitting, but everyday web users are not among them. 

With so many tech giants, small businesses and government agencies collecting and earning off personal data, who can we trust to make sure consumers are getting their share? 

Fortunately, today we don’t have to trust anyone — at least not in the traditional sense. Today we have “trustless” technology, and it’s known as blockchain.

Tipping the Balance of Power 

Many people continue to be unaware that their online data has immense value, but even those who do realize it have limited means to earn from it. The good news is that new technologies are rapidly advancing that can give consumers a say over who collects their online data and under what circumstances – including giving consumers the ability to charge for their data. 

For example, Blockchain technology has proven to be one of the best mechanisms for issuing digital rewards, and could pave the way for a new online era that allows consumers to financially benefit from information they choose to share online. Decentralized, fully transparent and trustless, blockchain can’t be swayed or corrupted the way government officials or data brokers can. Innovators from the private sector like the Data Privacy Protocol Alliance and other groups are creating blockchain-based data-sharing and storage systems that will reinforce data control, and in some cases, businesses are enabling data ownership through the ability to earn cryptocurrency in exchange for their data’s collection and use.

This will be revolutionary, and it’s the beginning of the end of the data monopoly tech companies have enjoyed for decades. It’s the end of online labor for consumers, and the beginning of an internet that belongs to everyone, and benefits all of its users equally.

Privacy vs. Ownership 

Not only have consumers been engaging in data labor for years, they’ve been working in full view of anyone with a budget to share with data brokers and tech giants. Not only is there no fun, there is also no privacy.

This is something else that’s beginning to change, and that’s because of laws like the EU’s General Data Protection Regulation (GDPR), America’s CONSENT Act, the Information Transparency and Personal Data Control Act and other laws, some already codified and some still pending.

Additionally, tech companies like Apple are offering consumers the ability–for the first time–to opt out of online tracking as they peruse the internet on a mobile device.

These are welcome (and overdue) developments, and they show that the pendulum is beginning to swing away from big tech’s data exploitation. Still, bringing more privacy to consumers’ online lives is not enough. Granting privacy is not the same thing as granting control or recognizing that data is an asset, owned by individuals, not big tech. 

If data is property, and property is valuable, blockchain is an exciting technology that can enable individuals to be rightfully compensated for that property, thereby giving them true control over who can collect – and profit – from it.

If users are not demanding this control yet, it’s just a matter of time. When blockchain is more widely deployed throughout the banking system, finance, healthcare and other industries, consumers will see what it can do.

It can bring about a new kind of web economy, where individuals are the owners and stewards of their own data. And this is exactly what they will demand to be.

The internet is no fun anymore, and it’s because we are being bombarded by ads and dogged by spies wherever we roam online. But data ownership and monetization will change that.

Tech giants are having all the fun today, because they are the ones making all the money from the data harvesting. Blockchain—brought to us by private sector innovators—will enable consumers to hold, trade and profit off their data for the first time. It won’t be long until we’re all having fun online.

 

(Excerpt) Read more Here | 2021-08-05 17:05:00
Image credit: source

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