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Ovum predicts turbulence for the Internet economy, as more than two-thirds of consumers say ‘no’ to Internet tracking

Filed under: All Articles > Industry News
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By: NMK Created on: February 6th, 2013
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The Internet economy is at risk of crumbling, following the recent data privacy scandal of WhatsApp and the on-going concerns surrounding Facebook and Google use of users' data. Ovum’s research shows that these incidents have significantly harmed the reputation of Internet companies as a whole - only 14% of consumers now trust that their personal data placed online would not be exploited.

Mark Little

Digital consumers around the world are starting to tire of their personal data being collected across the Internet, says Ovum. The global industry analysts paint a threatening scenario for the Internet economy, as consumers seek out new tools that allow them to remain “invisible” – untraceable and impossible to target by data means.

Ovum’s latest Consumer Insights Survey* reveals that 68% of the Internet population across 11 countries would select a “do-not-track” (DNT) feature if it was easily available, suggesting that a data black hole could soon open up under the Internet economy. This hardening of consumer attitudes, coupled with tightening regulation, could diminish personal data supply lines and have a considerable impact on targeted advertising, CRM, big data analytics, and other digital industries.

Unfortunately, in the gold rush that is big data, taking the supply of ‘little data’ – personal data – for granted seems to be an accident waiting to happen. However, consumers are being empowered with new tools and services to monitor, control, and secure their personal data as never before, and it seems they increasingly have the motivation to use them.

Recent data privacy scandals such as WhatsApp’s use of address books, and the continuing issues over privacy and data use policies on Facebook and Google websites have fueled consumers’ concerns over the protection of their personal data. Ovum’s survey found that only 14% of respondents believe that Internet companies are honest about their use of consumers’ personal data, suggesting it will be a challenge for online companies to change consumers’ perceptions.

Ovum believes that Internet companies should introduce new privacy tools and messaging campaigns designed to convince consumers that they can be trusted. Improving the transparency of data collection and use will help to build trust, a commodity that will increasingly become a sustainable competitive advantage.

Internet companies need a new set of messages to change consumers’ attitudes. These messages must be based on positive direct relationships, engagement with consumers, and the provision of genuine and trustworthy privacy controls. Most importantly, data controllers need a better feel for the approaching disruption to their supply lines, and must invest in tools that help them understand the profile of today’s negatively-minded users – tomorrow’s invisible consumers.

Notes

*Ovum’s Consumer Insights Survey is a detailed 40-question survey covering a variety of topics, including communication trends, social networking, Internet applications, pay-TV subscriptions, and online media. The panel now consists of over 11,000 respondents from 11 different countries across Europe, Asia, North America, and South and Central America.

About the author and Ovum

Mark Little is principal analyst at Ovum. Jointly awarded IIAR Global Analyst of the Year 2012, Ovum provides clients with independent and objective analysis that enables them to make better business and technology decisions. Its research draws upon over 400,000 interviews each year with business and technology, telecoms and sourcing decision-makers, giving Ovum and its clients unparalleled insight, not only into business requirements but also the technology that organizations must support. Ovum is an Informa business.

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