Do Privacy Concerns Really Change with the Internet of Things?

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As it is virtually impossible to walk around the OnPR office without tripping over the Internet of Things these days, or stepping on a digital transformation project of one kind or another, I spotted with interest the new report from Altimeter Group: Consumer Perceptions of Privacy in the Internet of Things, by Jessica Groopman with Susan Etlinger. I recommend it as worth a look to virtually anyone in business today.

Although I read it straight away, I was interested to see what sort of response it got before writing a blog post. The report, subtitled ‘What Brands Can Learn from a Concerned Citizenry’, covers only the US market, based on a survey with over 2000 American consumers. I tend to be interested in more internationally applicable research, so I also wanted to reflect on some of the potentially more widely applicable findings and recommendations.  The following graphic highlights the key findings from their report:

Altimer Group Picture Source: Altimeter Group: Consumer Perceptions of Privacy in the Internet of Things

 

One interesting write up in the Leadership column of Forbes magazine, by contributor Rawn Shah, asked a question that particularly interests me: Do privacy concerns really change with the Internet of Things? Rawn’s take on this is: “It’s not simply about data collection from these devices around us. Rather, these are just the start of the data value chains.  There’s an industry of data brokers built up around working on this information. We want to know where (our data) are going, and what is happening to this hidden life of our data.”

From my perspective, while the Internet of Things heightens the potential risks that individuals face where personally attributable data is shared without permission (and in a world of machine-to-machine transactions, when is your permission being sought out?), the issue was already appearing with the first cloud-based applications, not to mention social media. So while the risks can now be greater in the new world order, the privacy concerns were always there (just perhaps not as strong in the US as elsewhere).

My take is that privacy concerns, and resulting take up of new technologies, vary greatly from country to country, based on a whole range of cultural, historical, and economic factors. If anything, I’m pleased to see that the US respondents of the Altimeter survey seem to be a little more ‘cautious’ and ‘concerned’ regarding data privacy than was the case five years ago during a research project I was involved in. I say that, as it can be impossible to have a debate on an international level around a topic of such borderless importance, when parties to the discussion don’t recognize to anything like the same extent that there is a real problem that needs to be addressed.

In 2010, Fujitsu (an OnPR Client) produced a report based on a survey of 6000 respondents covering 12 countries including the China, Germany and the US: Personal Data in the Cloud: A Global Survey of Customer Attitudes and the Importance of Trust. It found widely diverse attitudes to both the benefits of cloud computing and what governments and businesses were expected to do to minimize the pitfalls, namely perceived risks to data privacy. China was at one end of the spectrum, respondents perhaps having very low expectations of keeping their data private, while Germany was at the other end with respondents showing a ‘stay out of my business’ stance, and a wish to retain control full control of their data without giving permission to their government to act as Lord Protector.

Similar to the Altimeter report, establishing trust was found to be the key, and it seems many companies have a long way to go to do so. One interesting respondent quote from the recent report highlights the next point I wanted to make: “I see purposeful obfuscation and lack of transparency on the part of companies. Understanding is easier when a company is interested in telling me what they are doing with my data first, then interested in making a profit second.”

In the days of the opening up of competition in the utilities and telecommunications industries, such ‘obfuscation’ became a key marketing and communications tool, purposely making it difficult for customers to compare offers like-for-like. While these companies, largely protected by national boundaries and with the appearance of regulation to minimize the worst of self-interested actions, can still get away with this shoddy practice, I don’t believe that this will work as an approach in the era of global digitalization.

In a globalizing marketplace for digitalized services and solutions, the offerings that succeed will be the ones from the providers that people trust. I believe that it will become so easy to compare the most trusted suppliers with the rest of the pack, that the trust shown by an informed ‘community of peers’ – be it housewives in a particular town, highly-specialized micro-biologists, the company purchasing team, or whoever – will become the key differentiating factor against which companies will rise or fall.

Ronna Porter

 

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