CNBC TV18 Column: Data Privacy and the Cost of Free

This appeared on the 18 of December

It is an universe of data out there – a seemingly infinite supply of data points about you and I, that are sliced and diced, then analysed, so that corporations and politicians can sell us more of their wares.

All this data is supposed to transform the way in which we live, work, access services, and make decisions – and expected to give us better shopping, better services, better policing, better health care, and more. The data is mined, and the supply of data seems infinite.

The powers that control data –monopolistic, mostly unregulated corporations – mine it to know more about us. They claim it is to give us more choice, and better targeted services.  They say their platforms are for the greater public good, and that it is free for all and allows everyone a window into the world. While the cost of entry and usage of the platform has zero monetary cost for us, we pay for it in the form of our data. The very same data that allows Facebook, Amazon, or Google, to know more about you than you probably know about yourself. And they share this knowledge about us, at a granularized level with whoever pays well it.

While across the world there are concerns about the use and abuse of data, the worries about India are slightly more. We are a people who are rapidly absorbing the internet into our lives, without any filters. There are almost 600 million internet users.There are over 345 million smartphones, and it predicted that by 2022 it would reach 829 million. Most of this will be rural users. If you see platforms like TikTok you will see the rise in slickly produced content from smaller town, and rural India. For most Indians, be they from rural or urban backgrounds, the concept of data privacy and security is very distant. And, therefore the consequences, individually and collectively, of data monopolies, seem very far away. For most of these users, their top platforms of use are Facebook, Youtube, Tik Tok, Amazon – all of which are free. And, all of which is paid by our virtual blood – data.

Large digital businesses tend towards being a monopoly.  Afterall, no one is going to join a social network with no one on it, or a taxi ride service with no cars. The Network effect says that people gravitate to the network with the most people. And, as more people gather to one network, all other networks around die. Now combine monopoly power, with free and what you have is a scenario where no other competition is possible. This is the subject of debate in many countries, with business lawyers and experts arguing that existing competition laws need to be changed in a digital economy, to prevent free being used as a barrier to entry. They believe that using ‘free’ as a device these platforms are extracting a monopolist’s pound of flesh.  Platforms like Facebook conduct “unprecedented commercial surveillance” because of their monopolistic position.

In India too there is a quiet conversation that is going on about the nature of digital monopolies, and their impact on our lives. A recent paper by the Data Governance Network (DGN),looks at the price of free, and the application of Indian anti competition laws to this practise. It suggests that the Competition Commission of India (CCI) ‘should not exclude zero-price platforms from the purview of competition’. The paper  also suggests that the very fact that we as individuals lose control of our data is in itself an illegal act, and this should be considered  by the CCI when dealing with zero price platforms.

Our data belongs to us. If companies like Facebook are mining the most intimate details of our interactions and transactions and selling our data – that is an extension of us as individuals- to marketeers, then there has to be kind of checks and balances. Do we really want some algorithm to be able to push our buttons, based on our data, and get us do things that we wouldn’t otherwise? The price of free is a part of you? When you sign up for an online service, they never tell you that.

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