Transcription
I'd like to, uh, go on an exploration with you today on three questions; three questions which will undoubtedly change you the moment you leave this Auditorium; three questions which will nurture an idea, possibly so large it would disrupt industries that we currently hold as unassailable. Three questions: Are you being robbed? Are you missing out? Are you being paid?
So I saw this photo, and I thought about how we all transit through our lives. We seem to go in all these different directions, leaving behind these vapor trails as we go through our lives. And you know, we do; um, it's quite identifiable where we're going. To give you a little bit of context, let's have a look at, uh, Google. Any of you who have a Google account, or an Android phone, or even those of you with an Apple account, you can find this information. So let's look at Google; just type in location tracking or timeline, and you can actually see all the places you've been. So here's me, but more importantly, let's go pick a date. Here's, uh, September 12th of this year; I was in New York. Uh, I left the hotel at the New York Palace, went over to the Eugene O'Neill Theater—all date and time stamped. I came back to the Palace; I went to J. Crew, bought some socks—very important—went back to the Palace, hung out there for an hour, checked emails, went over to Rockefeller Center. You can probably guess what I saw at the Rockefeller Center; those are my photos, by the way; Google courteously appended them to the timeline for me. Um, every single step of mine tracked, and every one of you that have any device, either Apple or, um, Android, have exactly that amount of tracking in your lives if you choose to go look at it.
And so I want to think, as we look at this for yourselves, that you're like this automobile driving around the streets, and behind you you're leaving an exhaust behind you. And that exhaust is your personal data exhaust. And if you look really closely at that exhaust, it's not carbon monoxide and particulates; it's actually ones and zeros. And in fact, hidden in those ones and zeros are dollar signs, because that is worth a tremendous amount of money. And so here's, uh, Facebook, our friend. Um, location history, obviously conveniently turned on automatically for you. Um, bottom left, tracking of everywhere someone's been. And I'm going to tell you a story about a friend of mine in Palo Alto, in California, who went shopping—well, shopping is actually a bit of an extension—went with his wife, browsing homes, just privately having a look, took some photos, and posted them on Instagram. And now you can guess why Facebook bought Instagram for a billion dollars. Um, posted them on Instagram, and what happened? The very next day, this cross-referenced against Zillow, which is a real estate homes compendium, that actually matched the photographs and his location against the houses he and she were looking at, and gave them not only a realtor named Kathy Thle—with 33 stars, by the way, she's really good—um, and pricing, but actually cross-referenced credit history, income statements, and location to give him offers on that house, all without his consent or knowledge. There's a lot of money in that data.
Fitbit—many of you might have one or know what they are. Health trackers; they're now being used in the courtroom. Let me tell you another story. This gentleman, unfortunately, traveled a lot, and, uh, he believed, unfortunately, that his wife was being unfaithful to him. So when he came back after a trip, he actually accessed their joint cell phone records, which he has a legal right to, and found out that indeed she had been going to the wrong side of the tracks at 2 a.m. in the morning on times he was overseas. But not just that; he could access her Fitbit record, which was actually attached to her application on her cell phone, to find out that her heart rate had been spiking to 157 beats per second for 27 minutes at the same time. Now, half of you are all going, "Wow, that's really creepy," and half of you going, "Wow, 27 minutes." So calm yourselves; calm your heart rate.
Now, for the big reveal; this is important: Your personal data is an asset, like a bond, like a stock, like your home; it's an asset, and it belongs to you. You have rights, title, and interest in your data; it is yours, and the world seems to have forgotten this. So part of it hasn't. Google market value per user; they've quantified you, not as a person, but as a unit metric of how much you're worth: $200 at Google, $116 at Facebook. The price of free—PC World, Apple, Facebook, Microsoft—they're selling you to advertisers. So the old saying, "If you're not paying for it, you're not a customer"—you are the product. In this fact, actually, I don't think you're the product, but your personal data is actually that product. And at the bottom, we're living in an era where big companies not only exploit what we've given them for free, but it could be used for good or to create entire business empires. So there's a tremendous amount of value in that data, and it's being used without your consent, often without your knowledge, and someone else is making money over your stuff. And if you have any other just reference points to want proof to yourself, have a look at any website you go to where there's an ad; that ad is often generated after it's been tracking your history, what you've been doing, where you've been going, what you've been consuming or looking at to consume, and then people are paying—in this case, Ford, Nikon, Hilton—to offer you ads for something they think you might want. There's a huge amount of, of, uh, of lucrative business in that personal data. So are you being robbed? I would certainly contend, for many of us, yes, we are.
So I found this picture, and I just loved it; it's a classic standoff. You've got these three people, all with their guns loaded, pointing at each other, no one knowing what the next step is. And I like this guy; I thought he was software; he's got a big soft coat on. Um, he's kind of a software-looking guy, and he, or is actually software in big data, and what they're doing is trying to get you, as much of your data as quickly as they can, to do stuff with it. And they've had all kinds of issues: Uber had god mode—I mean, really—Facebook privacy tweaks; Facebook has been a constant, unfortunate abuser of privacy, and they've run experiments on people; and Spotify, at the bottom, a huge privacy backlash. What is actually your data worth? So then you've got this guy; he's kind of hardware-oriented, hardware, internet of things. So we're talking those Fitbits, those Nest Thermostats, self-drive cars; we're talking devices and everything. And to just give you two examples: Here's William Meredith, who pulled out a shotgun and shot down a drone over his backyard; um, it certainly wasn't his, and his daughter was outside sun tanning. Um, and then Samsung TV—any of you who have one, just check when you get home, please—many of them were shipped with their webcams enabled and the, um, uh, microphones enabled, and so it could actually monitor your room, which might be your bedroom if you have a TV in there, and, uh, it actually, anyone could hack into it effectively and turn on the camera and the microphone without your notice and actually record you while you're in your room. Now, Samsung's idea was it would sit there waiting for you to go TV on. So think about that, and think about how they then had to ship firmware to, like, update those TVs. And so then you've got the regulator that goes, "Whoa, we need to somehow stop these two parties; we're in a standoff; what are we going to do?" And the regulators enact a whole bunch of laws: Consumer bill rights in the US is opt-in legislation; you have to choose now if you want to opt in; lots of stuff in Europe, the European General Data Protection Regulation, covering all personal data; even here locally, the new people law on privacy. So lots of regulatory action. And software and Big Data go, "Okay, you got me now; I'm going to do this." And what are they do? iTunes agreement—great example. Now, many of you probably have an iTunes account and might use an iTunes agreement, but if you actually dig into it a little bit further, have all of you realized it's 20,745 words, over 36 pages? So honestly, raise your hand in the audience if any of you can actually say you've read that before you consented to it. In fact, seven attorneys spent seven days, as published in a Forbes article; those seven attorneys still could not understand what privacy rights were given up. And so that is responded to by that industry by giving you all kinds of settings on your devices, iPhones here, but your iPhone has a microphone, a camera, an accelerometer; it has all these different applications, and you are given opportunities to try and customize them, but many of us just want to play Angry Birds, so we just download them. And so if you run an, an, an analysis on your device, you can very quickly find out—and this is actually on mine—50 applications accessing my contacts, 57 accessing my information, 247 whether or not the app was actually being actively used, and 61 accessing my media files. And you ask me why Uber needs a copy of a photo I took of my children on the beach; they don't. So we give this stuff away.
And so I think about it, and I actually think we're none of those three; we're actually the camera person; we're taking that photograph; we are watching this happen to us. And when I think about us watching this, I actually think about this, and this is just heartbreaking as a father of two, two young boys, six and 10, one of whom is in the audience. I think about the amount of time we're spending with our youth in front of devices, and you know, good parenting and other decisions are part of that, but a very big part of it is the fact that they are actually building their own digital legacies, their own vapor trails, exhausts as they're going through life at a very young age. And in fact, if you aren't sure about that, you should know what Facebook's, um, shadow profiles are about; every single person in this room has a Facebook profile, whether you use the application or not; some of you, and a friend I know here, actually stopped using Facebook, but he still has a profile. And I saw a lady walking around earlier that was very pregnant, and I can tell you when she took the ultrasound probably and shared that on a social media site, that baby, born yet, has a profile. So that is the world we're living in, and we need to take, take ownership of our role in that; we can't just watch it.
And so when I ask, "Are we missing out?" I absolutely believe, yes, indeed we are. So the good news is there's a solution. So every good story has to have some kind of a villain and some kind of win at the end. So let's look about the win here; the solution involves the reality that there are companies like Uber, and let me tell you why that's important, and I'll give you a couple of examples. It's something called disintermediation; it's a big word, so let's make it easy: It's get rid of the middleman. What disintermediation does is brings people who have something immediately next to people who want it and take out all the people who would have otherwise been in the middle. It's the beginning of the sharing economy that we are so enthralled with. Uber owns no vehicles; they're the largest transport company in the world, almost, and they connect people with vehicles to people who want vehicles. Airbnb owns no real estate—not one—collectively booking more hotel nights than the top 10 hotel chains in the world combined, and connecting people with a place directly to people who want a place. Facebook creates no content, connecting people with content directly to people who want content. And Alibaba, the, um, Chinese internet giant, connects people with goods and services directly to people who want them while carrying no inventory. It's a pretty compelling story. So let's see how it might work with us, but it's about this thing called PII. What's that? What's interesting is your personal data, in and of itself, is actually not that valuable unless they can connect it to you. So all these companies are trying to personalize your experience, offer you more relevant goods and services, and they collect all this data, but unless they can attach it to you, it's of no value. And so PII is personally identifiable information; I'd like you to try and remember that because it's a very big current thread. And what it is is all those traits and characteristics that might link your personal data to you: name, social security number, actual history, location, biometrics, any of that, voice print. So it's actually all about the PII, and I want to share with you how it's currently being done and then what the new world looks like. How it's currently been done is you've got yourself with your digital device and your data capture, and you want to obviously access some goods and services, but the world is actually going that route right now. And if you ask why, let me tell you what's happening: You start the circuit with you collecting a lot of data through your devices and through the internet of things and smartphones, and then those devices, because they're running on software by other large companies or applications run by them, they obviously collect all that data, but they know they legally cannot use it because it's got personal attributes attached. So what do they do? They anonymize it; they strip all the personal identification off. Once they've anonymized it, now they can buy and sell it, and now you can see the virtuous chain of all the revenue creation that buying and selling goes to people who then are using it with analytics, sometimes running AI and, and, uh, other, um, uh, algorithmic measures to try and figure out stuff about you to actually recompile it to ultimately figure out you are who they think you are, so they can then sell it to someone who's going to advertise to try and sell you a product they think you want. That is 358 degrees around a circle, and it takes an immense amount of time and cost. And if you have a question about that, how much value is in there, just ask Google, who 90% of their revenues come from advertising. So why don't you just go the other way? Why don't we just intermediate the whole thing? Why don't we get rid of the middlemen and just go straight? That is the bridge that we're going to cross soon, and that is what we call two degrees—one degree there and one degree back. So that's a bit subjective, maybe, so let's use a concrete example. The great thing is, with my data, it's my data; I own it; I've got choice. So I can choose to engage in a fair value exchange, and imagine in that two-degrees place that I choose to share my PII, my personal data, to someone who's got goods and services that I might want, in return for the immediate, real-time attribution of those characteristics that they desperately need in order to offer you relevant, personalized, immediate goods and services. They now save a tremendous amount of money and time by not having to advertise, and they can now discount the product and immediately give it to you. By discounting it, what are you doing? You're actually reducing the cost yourself. And so we talked earlier about J. Crew; I bought my socks. So real-life example: Imagine if J. Crew knew all my stuff, but I'm walking down and actually, uh, in the street, and I can share on demand my size, style preference, loyalty awards, location, how much my average spend is, and if I choose to do that, J. Crew—so we have your size, those styles that you like, and the colors you want for the spend that you usually do—and walking in the door now across the street, and it's 20% off. Or imagine if Fitbit, in your healthy and virtuous lifestyle, in the good example of Fitbit, and you have an amazing regimen of exercise, which shows your discipline, shows your heart rate, shows a lot of really good valuable information, and you apply for life insurance in real time; all that underwriting cost can be removed, and you can get a discounted policy. Imagine a hotel here, like Hilton, where they might want to know where you travel, what kind of rooms you like, what kind of spend you do on, uh, in, uh, in-room services, um, your, your kind of loyalty attributions, and I, what—imagine if you could do that the first time you shop, and Hilton could offer you discounting immediately rather than having to buy ads in your social media feeds and websites ongoing. Lots and lots and lots of examples how your data will actually change the future, and what it's all about is actually you monetizing your own data, not someone else's.
So if I wrap up for a moment, let's just think about this: You go through life, and you leave a personal data exhaust behind you, and the big reveal is it's actually your data, and it's an asset class. And right now, it feels like we're being robbed, but it's a standoff. And within that standoff, at virtuous cycle—if you know about standoffs—one way to break them is to actually introduce a fourth event or something else that's going to change the dynamic. So instead of just watching and just missing out, maybe we act, and maybe we take control; maybe we get involved. And so the good news is there is a solution; it's that word disintermediation; it's the sharing economy; it's the Ubers and Airbnbs of the world. And that kind of solution is coming right now to your personal data world, and it's all about the PII. And if you do it right, and if you have choice, which means you can choose when you act and when you don't, which is extremely powerful because you can opt out anytime you want, when you do choose, you can monetize your own PII. And so about, uh, 20 minutes ago, there was a challenge in the video that you have to be able to sum up your entire TED Talk in six words. And not being one to shy away from a challenge here, we go. So we asked the question, "Are you being paid?" You will. Thank you very much.