Big Data 2.0: Data Protection regulations 'need better balance'
This blog post was written by Simon Torrance, CEO of the Telco 2.0 Initiative, reflecting on a meeting of the World Economic Forum on 'Big Data, Personal Data and Data Protection' that took place in Brussels with EU representatives and others last week. He notes significant positive developments in richer understanding of this complex topic and describes the potential role that telcos can play.
Simon will be sharing key insights on personal data and digital commerce at the invitation-only New Digital Economics Executive Brainstorms in Digital Arabia in Dubai, 6-7 November, Digital Asia in Singapore, 3-5 December, 2012, and in subsequent brainstorms in Silicon Valley and Europe in 2013.
Last week I took part in the World Economic Forum's (WEF) Personal Data workshop in Brussels, along with 70 executives from Europe and the USA representing organisations such as Allianz, AT&T, BT, Deutsche Telekom, the European Commission, the European Parliament, Facebook, Google, Intel, Microsoft, OECD, Novartis, Renault, UPS, Visa and various experts, professors and consumer rights and civil liberties groups.
The workshop is part of a regular series of meetings that the WEF runs around the world (the last one being in China last month), focusing on how to 'unlock the value of personal data: balancing growth and protection' and part of its new 'Data-Driven Development' project.
As a member of the WEF's 'Re-thinking Personal Data' project team and their global ICT Agenda Council for the last 2 years, it was heartening to see that the debate is moving on much more quickly with more important bodies involved. Things have come a long way since February 2010 when we ran our first 'Privacy 2.0' event in Boston with MIT and NSN, through which we first connected with the WEF. Output from our recent workshops this year in San Jose and London have helped to direct and push forward the debates.
Those who have followed the Telco 2.0 Initiative will know that we have been talking about the unique, but latent, value of telco 'customer data' for at least four years now. The WEF's project has given the subject greater importance, as it places 'customer data' (data that a company has about its customers which it tries to mine and analyse to serve them better) within the context of the bigger concept of 'personal data' (data that we as individuals automatically generate as we go about our daily, digitally connected lives).
PERSONAL DATA - 'A NEW CLASS OF ECONOMIC ASSET'
The World Economic Forum believe that personal data is potentially a new class of economic asset (the new 'oil' or 'currency' for the digital age) and that individuals, as producers of this asset, should have access and control rights to it. Today most individuals have very little appreciation of what they are generating, nor the potential value of it - to themselves, the private and the public sector.
Like any asset - oil, money, water - it only becomes valuable if it can be distributed and exchanged and done so within a set of protocols and practices that are trusted and adhered to internationally. Currently no 'infrastructure' - legal, technical and commercial - exists for the safe and trusted exploitation of personal data.
The laws that govern the use of personal data (influenced by 30 year old OECD principles related to privacy and data protection) cannot keep up with pace of technological change and new forms of human behavior enabled by it (e.g. Facebook usage and location-based services).
And so, we are potentially stuck in a situation whereby 'Big Business' wants to take advantage of 'Big Data', consumer and civil liberty groups lobby government to restrict their abilities to do so ('do not track'), and governments create laws with the potential unintended consequences of stifling commercial innovation (and thus economic growth).
This vicious circle restricts personal data from realizing its full potential in terms of societal benefits (contributing to better healthcare outcomes, democratic engagement and traffic reduction for example) and consumer benefits (cheaper, better, more personalized products and services).
At the WEF's Brussels workshop we heard plenty of great examples of both sets of benefits that are real today all round the world.
PROPOSED EU APPROACH - GOOD NEWS
The good news, though, is that now, at last, these issues are recognized at the highest levels. I was very heartened to hear on Monday members of the European Parliament in charge of data regulation admit that the proposed new EU Data Protection regulations which are currently in review phase were "too blunt", that they needed "adjusting to suit local needs", that they "needed to find a better balance between supporting business innovation and protecting the consumer".
This realization is a major step forward in addressing the legal part of the golden triangle of issues: regulation ('rules'), technology ('tools'), and commercial models ('money').
The technology aspect is perhaps the least challenging of the three - big steps are already being made into how to embed rights and permissions into the data (a key enabler of the free movement of data across storage silos, topic domains and geographic jurisdictions) and the secure management of the data.
Interoperability of digital identities is another important technical enabler, and effective standards for this should be achievable if the right technologists sit together to work it through.
COMMERCIAL MODELS ARE TRICKY
The commercial models are trickier, because they rely so much on the two other aspects being in place.
For telcos we believe there is potentially a unique role to play in this emerging marketplace: to act as custodians of individuals' data, proactively helping them manage and exploit it through personal data services. At our events around the world we have tested these ideas and most delegates agree with the proposition.
Some telcos have taken the first steps towards this. Telefonica for example is piloting a project in the UK to allow its customers to view the data it holds on them. The aim is to create 'transparency', the first step in gaining greater levels of trust with their customers.
Orange has a similar general philosophy, but has chosen to start (publically at least) by making certain data available to support public sector social causes in emerging markets via a project called Data4Development.
Others, like Verizon Wireless, have set up new business units to leverage telco data to support of third party marketing.
Telco 2.0 believes that there is a significant strategic opportunity for telcos to take a leading role in helping the world take advantage of this new class of economic asset. In fact at a World Economic Forum strategists meeting last year, it was rated as 'the most important strategic opportunity' for telcos in the future, per the chart below.