2/13/12

The True Cost of Free: A Knife in The Back


Free software is never free, nothing is ever free. From email to iPhone apps and beyond, software has become one of the most common items to arrive at your doorstep "free". Just like your grandpa told you, there's no such thing as a free lunch.

Promises Promises

The majority of free software/services promise to use our data responsibly and respectfully.  Many companies even claim to only use information for internal use or account identification. These are excellent policies and most companies mean what they say, but a company can only guarantee a promise in the present. Any promise or policy a company communicates to its users should only be considered true the moment it's made, or while the company is demonstrating it's true.

It is and must be the burden of the company to continue to re-enforce the promises they make to their users. If at sign up time a disclaimer states that email addresses will only be used to communicate directly and never be sold to a third party, that information should be readily available in another location and users should be reminded of that regularly.

I'm not talking about TOS or a EULA or any other 64 page document that requires a lawyer to decipher it. I'm talking about putting the exact claims made to users about their privacy and data, in one place that is easy to find.

Desperation

The vast majority of companies, whether private or public, are made up of shareholders. For instance, according to a recent thread on quora Jack Dorsey may own only 15% of Twitter. What shareholders want is a continuous growth in profit and company value. Many free products primary source of revenue is in advertising, and therefore the number of eyeballs on a webpage.  At some point, a product will reach its limit on how many page views it can generate and how much advertising revenue it can generate. 

When this happens they will have to start looking for new sources of revenue and ways to keep their shareholders happy. It's far easier and more profitable to exploit the customers you have than to innovate all new products.

As a consumer do you a trust a company to do what's right for your privacy, when it has shareholders breathing down its neck and millions of dollars on the line? Better yet would you be trustworthy in this situation?


Pushing the Limits

It would be hard to throw a lawn dart in Silicon Valley without hitting someone that believes privacy is dead and we should get over it, or other similar non-sense. What’s more important than technorati and entrepreneurs saying this are them believing it. One of the largest implications of this mentality is that what we are exchanging our privacy for is worth it, which "they" also believe. 

The die-hard believers of this theory are pushing the entire industry of free services forward, in their bid to plunder data and compromise privacy. They ask for more information, more access, and pioneer new ways to gain new footholds into our lives. When new in-roads are found without stirring up the dander of the masses they make it clear that it is the status quo and everyone does it. What better defense? Find something you shouldn't do, get everyone else to do it, and then claim you did it because everyone does it. Genius.

What's a Privacy Savvy Guy to Do?

It is impossible to tell if any company will turn and do something terrible with your data, but it's far more likely that a free service will. Spending a few dollars on a company or developer with an excellent reputation is a good start. A creator with a revenue stream that is acquired by having an excellent relationship with its customers is far more likely to make good and ethical decisions with your data.

There are still free services that aren't in it to completely screw you over, but it's important to understand their terms of service, their company track record, and keep up with changes that affect your data. 

It's also becoming increasingly more important for our journalists, tech and traditional, to keep an eye on the companies, developers, and corporations that we are becoming continually more dependent on. Our journalists need to be doing their part to keep these powerful interests in check, and to reassure everyday people that someone is watching out for them.



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1 Response to The True Cost of Free: A Knife in The Back

Anonymous
February 14, 2012 at 6:55 AM

I'am not sure to understand the argument here. You'll always saturate your profit at one point even if your product cost money.

Of course you can increase profit by lot of means like reducing costs, increasing product price... But selling your customer data is part of the possibles things.

In all cases, this very moment where you saturated your profit will come. And at that moment somebody will say, "Everybody else is making money with its customer data, why we don't do it too?".

This more an ethic problem and the way you present it. If you are twitter, you are OK. Twitter is a broadcast system, all is public. So nobody will have problem with Twitter or other companies using this kind of data.

But if you have a service like facebook, this is really different. What you put and share on facebook is part of the private circle of friends. But facebook think it has the right to use everything you put on your account for whatever it want.

That when things start to become anoying. People want to keep in control. And people want to trust the service they use. I can't trust facebook. And so I don't use it.

The problem is really the teenagers or young adults. They don't have the maturity to understand the implications of what they put into theses services. They understand the problem, but they don't care... And if problems start to happen, this is too late...

We can't even count the number of people that will not be offered a job, a promotion of will not be able to have a public role due to their laxist usage of social media in today.

One could argue this is like in real life. If you act like a moron all the day, people will notice. Not really. People fail to understand that facebook is in fact a public representation of yourself and not something in the private circle of familly or friends.

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