The hidden cost of convenience

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The hidden cost of convenience

Tuesday, 04 June 2019 | Shohini Sengupta

If the price of using the Internet is our data and privacy, then mere ownership of data and information will not be sufficient, although a necessary first step is to establish individual autonomy. More meaningful exercise of rights will come from the power to exercise the ownership of these rights

Earlier this year, a tech reporter named Kashmir Hill spent six weeks of her life blocking Amazon, Facebook, Google, Microsoft and Apple from “getting her money, data and attention”, using a custom-built VPN. These are famously the ‘BigTech’ companies. In the pieces she wrote documenting the process, she noticed that cutting off some websites and services was easier than others, although it was almost impossible for some like Amazon and Google. For instance, Amazon not only operates in a majority of retail businesses, but also controls other crucial services and key websites through ‘Amazon Web Services’ and employs a secondary service called a content delivery network to load web pages faster. She also found that almost every business and app uses AWS. Google is similarly omnipresent. Cutting off Google means cutting off apps like Uber, Spotify, emails, most pictures on the Internet and newspaper articles which use them, Airbnb and scores of other services.

What Hill found is critical to understand how technology behemoths control the way we experience life today. Is it possible to live without these services? Perhaps yes. But doing so will alter the way most of us communicate, relate, consume and experience the Internet, making our worlds dramatically different and exceedingly difficult. For most businesses, continuing to deliver services or distribute/market products will be critically impacted. This trade-off, therefore — between privacy and ethics on the one hand to be able to be employed, deliver at work, earn a living, research, travel, transact, communicate, investigate and live a meaningful life in a digital age on the other — is inequitable and seemingly insurmountable. It places libertarian principles in direct conflict with convenience. Hence, data, privacy and principles that we trade away and continue to do so, to get slivers of this convenience and buy into the promises of future convenience are the hidden price we pay for our existence today. This is the price expected of us and willingly or unwittingly, this is the price we must pay to survive. Margrethe Vestager, the noted European Commissioner for Competition, categorically stated that none of the services offered by the ‘BigTech’ should be confused with being ‘truly free’. In fact, with the proliferation of smart devices and online services addressing our every need, it is clear that consumers and businesses will continue to accept this trade-off of privacy and data with convenience and ‘efficiency’. Therefore, the question that arises in a world with an undeniably hidden cost of ‘convenience’ is one of knowing the true cost of this ‘convenience’. One way of doing this is to value the data we trade away, the untapped price of our yet un-traded data and privacy, and forming a framework to negotiate effectively.

However, calculating the value of this data is not just resource-intensive and difficult but also a near impossible task, given that we know almost nothing about the inner workings of big technology firms. More crucially, in an age of Cambridge Analytica, election rigging and fake news, there has been a visible breakdown of trust between the holders of technology and its consumers.

One way to approach this information asymmetry, just like we do for big banks and corporations, is through increased and more meaningful disclosures. An analogy to the financial crisis and the gradual mistrust that developed post the crisis may be relevant to a great degree here because just like the behemoth banks and financial institutions, technology giants have consistently denied sharing information on processes, governance mechanisms and customer assets like data, citing that more disclosure will not help. However, in a recent study on financial crisis, which analysed the link between bank disclosures and financial stability, it was found that there was little evidence to prove that disclosures set off problems or destabilised banks. Instead, poor and unreliable disclosures by banks led to erosion of trust, which coupled with delayed loss recognition, was a bigger problem than overreaction to bad news and bank runs because of that.

The second way in which the conversation around BigTech regulation is being shaped is to suggest a break up of the giants. In recent times, none other than Chris Hughes, the co-founder of Facebook, advocated for this. In his article in the New York Times on how Facebook has become too big and powerful to regulate, he wrote that the company must be broken up like a usual monopoly because it has become powerful using simple tools like mergers, acquisitions and copying innovations. He blamed these predatory economic practices to be the reason for no other major social networking company being founded since the fall of 2011.

Vestager, however, suggested that competition law may not be completely adequate because it is not equipped to handle questions of adequacy and safety of digital products. In suggesting a framework outside of competition law, she suggested we move beyond consumer welfare as the basis for state interventions. Instead, she suggested more transparency and more mechanisms available to register consumer discontent. She suggested we reform our thinking to distinguish between a ‘convenient’ life and a ‘good’ life. If the price of using the Internet is our data and privacy, then mere ownership of data and information about the use of data will not be sufficient, although a necessary first step is to establish individual autonomy. The second order and more meaningful exercise of rights will come from the power to exercise the ownership of these rights.

Therefore, the future of technology regulation will have to take dynamic trade-offs over static ones as Tim Wu, Professor at Columbia Law School, insists and will have to look at combinatorial regulation both within competition law and outside of it, demanding more meaningful information and trying to discover the hidden costs of trade-offs. Without understanding the hidden costs of data and privacy we so easily give, we only pave the way for more subversive exploitation and hidden predatorial business models. In short, we need to understand how to make the transition from ‘convenient’ life to ‘good life’.

(The writer is fellow at the Esya Centre)

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