Finally.(GenAI) Privacy has price tags
Generative AI is forcing our hand to put a price on privacy
The Privacy Brou-Haha
I remember walking away from a fiery water fountain conversation a decade ago thinking (Digital) Privacy is a Religion1. The believers had no doubt that consumer privacy was an absolute, inalienable right. The atheists were followers of Scott McNealy’s immortal quote from the 90s - ‘You have zero privacy, get over it’2.As an agnostic I walked away confused. I didn’t buy the believer argument of a fundamental right, or non-believer’s of complete capitulation. In brick-and-mortar life as analogy, you have no privacy if you are in a public place (or even in a private place accessible by a photographer’s telephoto lens). But you can pay-for-privacy via high walled lots, gated communities and such.
Do we even know our private selves?
The other overlay on top of bi-polar points of view, was the privacy say-do gap in what consumers actually believed (vs said we did). Behavioral privacy practitioners have laid bare this paradox between the lofty self-assessed value of our privacy, and how much value we assign it in actual transaction. Susan Athey (economics of digitization pioneer and now chief economist of the US Government antitrust division) captured the Digital Privacy Paradox best in the Three Smalls.
Small Money. People talk a big game but are swayed by small amounts of money to relinquish their (or others) privacy - the price of your friend’s email address is a slice of pizza, and the price of your social security number is somewhere between a Mars bar and a Starbucks.
Small Costs. The smallest friction in navigation costs (e.g. extra UI for conditional cookie acceptance) lead folk to abandon the privacy-preserving path.
Small Talk. Brands can add a bunch of illusory activities (e.g. encryption) that are unrelated to privacy but somehow construed as privacy preservation
Say the world was perfect
But even if you are a believer, and even if there were an efficient market for your data, how much is it worth? Tim O’Reilly, who has a decent track record of taking on difficult questions3 - places the value of your data generously at $15 per year. A religious argument for under 2 Starbucks cappucinos! Mon Dieu, that is a storm in a teacup, not even worth the argument.
However, now that we have GenAI
Just when I thought I knew how much privacy was worth (roughly your 2 cents for the day multiplied over the year, and a bit of inflation) - Generative AI brought an interesting twist. Generative AI has a) increased the benefit of a service to you, and at the same time b) increased the quality and quantity of knowledge it knows about you. The former compels you to use a service, and the latter scares you. It is beginning to break Athey’s Paradox because the things it can divulge about you are material, and yet you will bankrupt yourself by paying sizeable sums of money for every AI service that comes by if you have to pay-to-play on privacy.
In addition to content privacy, now you have pricing for Taste and Intent privacy. On Twitter/X , for $7/month, you can now “Like” a Tweet privately, which I imagine has value for mini-celebrities to express their freedom of speech while being immune to AI algorithms that might turn that into a (true or not) profile that could destroy their brand. On MidJourney, you can create imagery to your hearts content at $25/pm .. but your prompts are public. Or you can pay an extra $25/pm if you are running a creative business, so your secret sauce in creating differentiating imagery is protected. The rather chintzy cloud atop that layers leaves room for the ‘value pyramid’ to grow in layers. After all, we know that 7 is the right number (7 layers in the ISO stack, 7V’s of data and such ..), but how we get there is a mystery to yet unravel!
The conversation was incited by some freshmeat.net blurb on squirrelly things being done by Facebook in Consumer Privacy, stuff that would elicit a yawn now but quite the conversation catalyst at the time.
Scott was CEO of an ‘icarus like’ 1990s company .. Sun Microsystems, that shot to the Sun, got burned and got eaten by Oracle. He was also famous for screaming matches with Larry Ellison that were the pre-eminent form of Tech Entertainment in the pre-WWF era.
As also gratitude for publishing the only thing I have written that received over a million hits - https://www.xml.com/pub/a/ws/2001/04/04/webservices/index.html!