Rejoice: the Privacy Wars are about to begin
Jun 6, 2012
Do Not Track
Reign of Privacy Wars: Tech Giants Face Threat as Do Not Track Technology Gains Momentum, Challenging Advertising Revenue.
The billion-dollar revenues of the two American giants are basically due to the following: the two can provide advertisers with such complete and accurate profiles about the audience that the efficiency of their advertising spaces soars to the stratosphere. This happens because every time one of us visits one of the two sites, we leave (consciously or not) large amounts of information about our lives - where we are from, how old we are, what subjects interest us, things we identify with, etc. Well tabulated, this information turns into a succulent dish for advertisers who pay a lot for it - while Google spends relatively little to offer this platform, generating more than $9 billion in profit in 2011. Despite the record IPO, Facebook's revenue is still much smaller (less than $4 billion against almost R$38 billion for Google).
The weak point of the two titans is privacy. Undoubtedly, the two go far beyond what is reasonable in terms of privacy, making consumers practically victims of advertising power and pushing the limits of the law. "To the limits," I said? Perhaps it's a little more than that. Not surprisingly, Google is facing a mega-legal action in Europe and all indications are that Facebook is likely to have problems with privacy legislation as digital media mature. The issue is crucial for the development, stagnation or reduction of advertising revenues for both - in other words, the backbone of the business.
In recent months, with much less fanfare than the IPO of Mark Zuckerberg's company, important things have been happening in the tech industry's underground. The Do Not Track, a technology that prevents the user from being "followed" in their behavior while browsing the Internet (or other digital environment), began to be adopted by megacorporations. First, Yahoo! announced the adoption of DNT, as part of a larger policy of preserving user privacy. Then, Twitter also announced that it would support the technology and finally, Microsoft announced that the new version of its browser, the Internet Explorer 10, will come with DNT enabled - in other words, the average user will browse without knowing that they are "protected" by the tool. Firefox, Mozilla's browser, already had the Do Not Track enabled for some time.
The measure is a tragedy for companies like Google and Facebook, which become much more attractive to advertisers because of their ability to track users throughout the virtual environment. The technology will create gaps in the trail left by users that will make the information much harder to use - and therefore, less valuable. And we're talking heavyweights here. Yahoo! receives more than 700 million people a month; Twitter has over 140 million active users. Firefox and Internet Explorer account for almost 50% of browsers used on the Internet. There's no chance that the headquarters of Facebook and Google aren't thinking about this.
In addition to the facts, there are signs that the massive movement towards DNT suggests that the industry intends to claim its share of the two giants' immense revenue. The corporate pressure that must exist for greater legislation on privacy is probably on the same scale as the one that affected Microsoft when the company, in the late 90s, began to be accused of unfair competition with the then absolute Windows. The adoption of DNT is not only a measure of respect for the user, but the introduction of a toxic ingredient for a too strong competitor. The goal is not necessarily to kill it, but to force it to give up part of its advantage, at least.
The counterattack will have strong allies. The National Association of Advertisers in the US has already expressed its repudiation of Microsoft's decision, but naturally the company founded by Bill Gates must have imagined this. Wait for new developments from the pressure for more or less rigor in privacy legislation. It doesn't just decide if you are being more or less watched, but mainly, if the game's owners are earning more or less and in the last instance, this decides the game, with only well-organized societies being able to react.