Data brokers: You are the product
Data brokers: You are the product (03:49)
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Welcome to the third topic of lesson 2 on Databrokers. A data broker is something different compared to the auction we discussed in the previous topic. This type of company is not selling their inventory to show ads, but it just sells collected data. A couple of big data brokers that you probably have never heard of are: Acxiom, Datalogix, Omniture, Experian, Rubicon, Improve Digital, Metrigo, Burst Media, Sociomantic, Yieldlab, Smart Adserver, OpenX.
Some of them make billions, generated by selling data from hunderds of millions of people. And still you have never heard from them, strange right?
A data broker can give you very specific information about your target audience. For example: you’d like to know who recently devorced and is looking for a new home? Or you’d like to know if someone got pregnant recently in some specific area (even before they told the rest of the family)? Or you’d like to know if someone pays his taxes on time? Who is interested in what medication? A data-broker can tell you, only if you pay of course.
The American Federal Trade Commission is a superviser for the data broker industry. In a report they released they concluded that there is a big lack of transparency going on in the data broker industry. People don’t know the sector or the companies, so they have no clue that big amounts of data are being collected and sold to third parties. One of the companies that the FTC is supervising is owning data from 1,4 billion consumer-transactions and 700 billion ‘data elements’ and adds more then 4 billion new lines of data to it’s database every month.
According to the FTC it is kind of unthinkable that there are American people who you can’t find in those databroker databases.
Not creepy enough yet? A lot of databrokers also give a person a creditscore. This is a number that shows the creditworthiness of a person. The databrokers themselves don’t want to tell on what basis they create this creditscore. The company Experian for instance, creates a profile for people who are ‘less succesfull’. These are poor people who site at home a lot and think a lot about ‘how it could have been otherwise’. They live in ‘poor neighborhoods’ with ‘curtains in front of the window’ and ‘succulents in front of the window’. It’s a description that Experian purely made up theirselves. So if you live in a neighbourhood where Experian thinks a lot of ‘less succesfull’ people live, you can be placed under the same label. Even if you are insanely happy in life, do sports and do a lot of personal development.
So the data makes a lot of general assumptions based on averages from the data. It is not always right on a individual level.
So I can see you thinking right now: is this all legal? It is! A company can legally sell your data to third party companies, even if this data is wrong on a individual level. So even if you’ve never been in touch with a certain company, you can still end up in it’s database. So even if you feel like the wrong assumptions are made based on the data, try to find out where it all went. Hint: you can’t. The customer has to be informed about it in the general terms and conditions and the privacy policy. But who reads those right? 😉 More on that later.
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