Pricing privacy – the right to know the value of your personal data

https://doi.org/10.1016/j.clsr.2017.08.006Get rights and content

Abstract

The commodification of digital identities is an emerging reality in the data-driven economy. Personal data of individuals represent monetary value in the data-driven economy and are often considered a counter performance for “free” digital services or for discounts for online products and services. Furthermore, customer data and profiling algorithms are already considered a business asset and protected through trade secrets. At the same time, individuals do not seem to be fully aware of the monetary value of their personal data and tend to underestimate their economic power within the data-driven economy and to passively succumb to the propertization of their digital identity. An effort that can increase awareness of consumers/users on their own personal information could be making them aware of the monetary value of their personal data. In other words, if individuals are shown the “price” of their personal data, they can acquire higher awareness about their power in the digital market and thus be effectively empowered for the protection of their information privacy. This paper analyzes whether consumers/users should have a right to know the value of their personal data. After analyzing how EU legislation is already developing in the direction of propertization and monetization of personal data, different models for quantifying the value of personal data are investigated. These models are discussed, not to determine the actual prices of personal data, but to show that the monetary value of personal data can be quantified, a conditio-sine-qua-non for the right to know the value of your personal data. Next, active choice models, in which users are offered the option to pay for online services, either with their personal data or with money, are discussed. It is concluded, however, that these models are incompatible with EU data protection law. Finally, practical, moral and cognitive problems of pricing privacy are discussed as an introduction to further research. We conclude that such research is needed to see to which extent these problems can be solved or mitigated. Only then, it can be determined whether the benefits of introducing a right to know the value of your personal data outweigh the problems and hurdles related to it.

Section snippets

Introduction: from passive defence to active empowerment

The commodification of digital identities is an emerging reality in the data-driven economy.1 Personal data of individuals represent monetary value in the data-driven economy and are often considered as a counter performance for “free”

De facto monetisation of personal data already at stake

The monetization of personal data is already a reality in nearly all fields of the digital market. The European Commission has highlighted that the market for consumers' data is growing fast and business models based on monetizing data become predominant20

Savings

Consumers are encouraged to disclose their personal data by a discount covering a part or the totality of the price.

Earnings

Consumers are encouraged to disclose their personal data via a monetary benefit (e.g. a digital wallet).27

A counter-service

In particular personalization: consumers are encouraged to disclose their personal data by a more tailored service, e.g., a personalized search engine or a personalized social network platform. In some cases, the online services offered may lose some functionality when they cannot be personalized.

No incentives

None of the above incentives applies. In these cases, often consumers have an all-or-nothing choice when disclosing their personal data.

Combining this transaction structure classification with the

Quantifying the value of personal data

When asking how much a person's data is worth, the answer is not much. General information about a person, such as age, gender and location is worth a mere 0.05 cent. Persons who are shopping for a car, a financial product or a vacation are more valuable to companies that want to pitch those goods. For instance, personal data of auto buyers are worth about 0.21 cent per person.34 Personal data of people

“Active choice” models and the GDPR

There are several ways to increasing consumers' awareness about monetisation of personal data in the modern information society. It may be suggested that there are better alternatives for a right to know the value of your personal data. Particularly so-called “active choice” models are often mentioned in this respect.64 These models refer to an

Problems of pricing privacy

In this section, we discuss some problems of the idea to introduce the right to know the value of our own personal data in EU data protection law. In Section 5.1 we discuss practical problems, in Section 5.2 we discuss broader moral problems and in Section 5.3 we discuss cognitive problems.

Conclusions

In this paper, we analysed whether consumers/users should have a right to know the value of their personal data. The main reason to consider this question is because, on the one hand, the commodification of digital identities is an emerging reality in the data-driven economy and, on the other hand, individuals do not seem to be fully aware of the monetary value of their personal data. They tend to underestimate their economic power within the data-driven economy and to passively succumb to the

Author information

Gianclaudio Malgieri, LLM is a PhD Researcher at the Law, Science, Technology and Society studies (LSTS) of Vrije Universiteit Brussel, Belgium. Email Address: [email protected]. Bart Custers PhD MSc LLM is associate professor and head of research at eLaw, the Center for Law and Digital Technologies at the Faculty of Law of Leiden University, the Netherlands.

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