But that is an old saying. In these days one better adds: – you have to have tons of private data of real people in your database and means to refresh them frequently.
In the new economy the value of an enterprise does hardly depend only on classic assets such as machines, properties, employees, company shares and patents. The true new valuedriver is continuous access to private data of living men and women. The reason is simple: these informations can be used for a large variety of expanding business activities. And parallely the data can be sold.
Combining a new business-case with a settled one is called coupling business.
Facebook et al. can only be for free or really low-priced because they are all heavily engaged in coupling businesses. It is a romantic illusion to believe these companies have been financially desperate and hence had to identify some extra money-source to subsidize their core business (social networks, music streaming etc.)
It is completely the other way around: Making profit is the only core business and the social network, the music stream-channel, the social taxi-service, the free software, the messaging system, they all are just examples of the 21st centuries method for success.
One of the problems with coupling business now is that their true nature is not transparent to many of the established members – although they literally are sources of the coupling profit.
In the EU there are actually plans under way to uncouple this sort of businesses.
- One way of doing this is to allow anonymous or pseudonymous memberships. “DonaldDuck123” could then well be heavily interested in sedan-cars. Mailed offers would not get to his door but end somewhere in Duckburg. But the facebook business case will only partwise be effected. DonaldDuck123 can be still exposed to sedan-advertisement quite precisely.
- Another idea is to force any provider to have a coupling-free offer in its portfolio. For example the full-coupling version of facebook will remain for free. But there could exist a premium version of facebook for let’s say 1€ / month (?), where absolute privacy of all data and transactions is guarantied.
A new regulation like the second one here obviously would provide extra transparency. The value of member’s private data will be shown bare open then. With these information he can decide with opened eyes which alternative to choose.
When this rule becomes effective the companies will not have an easy time to take decisions.
- A monthly fee too high might give strong evidence to the classic accusations that these companies have robbed their members for many years. This could lead to massive image problems.
And moreover a relatively high price for the data privacy version would establish a dangerously high calculation-factor for any legal compensation claim.
- Too low a fee on the other hand could persuade too many members to choose the coupling-free version. This would let the frequent access to the private data erode – and there goes the old business model. What is the marketing use of facebook, if they cannot tell anymore who is interacting with my promotion?
One of the European promoters of these regulations is Jan Philipp Albrecht, member of the Greens and the European Parliament. Jan was quite successful this year. In March 2015 the EP followed his proposal for new Data Protection Regulations with a large majority. And in these days starts a documentation in our cinemas with Jan in a dominant role.
From a green perspective his demand for a coupling-free-offer might be alright. From a socialist’s perspective this is not evident at all. Who will sign up for the data-protected premium version of Facebook and who will not? Any ratio better than 1:10 would be a big surprise. The regulation most likely will lead to an exclusive club for a few protected guys and a large unprotected data-nudist-camp for all the rest.
Data protection in a democracy should be somewhat different.