Online media: personal data collection as a source of revenue?

 Susan Mcgregor

The limits of the ad-based revenue model are starting to show. Should we worry about online publishers getting involved in personal data collection in order to maintain income?

In his October 27 piece for this site entitled "Surveillance, privacy and the British press," author Jonathan Heawood raises (many) questions about the behavior of the British press in the wake of the Snowden revelations. Citing the apparent "cognitive dissonance" in some British news organizations' supporting both the Save Our Sources campaign and state surveillance, Heawood concludes that news organizations' financial dependence on data about their readers makes them the "strange bedfellows" of surveilling governments.

Many of the points that Heawood makes in the course of his piece hold true in the US as well as the UK: In 2013, for example, when Fox News reporter James Rosen was named as a possible "co-conspirator" (a criminal, rather than a civil, charge) by the US Department of Justice for his role in publishing classified information about North Korea's nuclear program, his own media company's criticisms were joined by those of many other news organizations. Yet just months before, Fox News had suggested that Edward Snowden might be a double agent, rather than a whistleblower, and in the wake of the recent shootings in California, a Fox News contributor suggested that law enforcement should increase surveillance of mosques and "stop worrying about people's rights" in the interest of national security.

Similarly, American media companies, like their British counterparts, have a vested interest in understanding where their readers are coming from. And of course, media companies have always been interested in knowing about the demographics of their readers; the idea of learning about your readership is hardly unique to the era of digital publishing (as a child, I remember physical surveys arriving with my parents' newspapers every year or so, printed with questions about annual income, marital status and church attendance). Just as food retailers use everything from loyalty cards to manufacturer's coupons in order in order to target their advertising dollars, media companies want to understand their readership so they can both better position their coverage and negotiate higher rates from advertisers. It's not unreasonable to suppose that cash-strapped media organizations might turn to selling consumer data as a way to cover the gap.

That digital media is not "'free'", as Heawood suggests, is only too well known to publishers, who for years have been cutting jobs to make ends meet as digital publishing has become the dominant platform for news consumption. And as Heawood also notes, the virtually limitless volume of advertising real estate on the Internet has almost certainly outstripped the "finite" volume of available dollars in the advertising market. Moreover, online ads command a fraction of the rate of their print analogs.

So it's not unreasonable to suppose that cash-strapped media organizations might turn to selling consumer data as a way to cover the gap. The problem is, selling their consumer data to online advertising networks - which is the way that most "free" goods and services providers make their money - would be like trying to sell milk to a dairy farmer. Thanks to web cookies, most online ad networks know far more about news organizations' readers than the media companies themselves. Moreover, some of the most important networks are run by the very same companies - like Google and Facebook - that already have access to so much of our most personal data.

Though as consumers we are increasingly paying for "free" services with our privacy, on the Internet the pipers getting paid are online ad networks and the companies that own them. Not only do the financials make it unlikely that news organizations are leveraging customer data for profit, but improving privacy for readers actually means better business for publishers. Improving privacy for readers actually means better business for publishers. 

For example, a large portion of media websites today are served over unencrypted HTTP connections; this make it easy for nearly anyone - from governments to telecommunications providers - to observe and potentially manipulate a user's web content. In addition to providing better privacy for consumers, serving news content over HTTPS connections raises the cost of blocking news websites by turning it into an all-or-nothing proposition. 

HTTPS also helps address another ad-based headache for media organizations and consumers alike: malware being delivered to consumers through online advertising. The reality of "malvertising" prompts many users to install ad blockers, which means lost revenue to publishers. But a switch to HTTPS - which has both become less costly and even has the support of the Internet Advertising Bureau - would protect consumers and reduce the need for ad-blockers online. 

Ultimately, the financial salvation for media companies may not be in advertisements at all; subscriptions, crowdsourcing, and yes, even micro-payments, have all shown recent promise for funding media content. So the soundest way forward for news organizations will likely be to continue doing what they do best: producing news and media that both serves and protects their readers' best interests./OD

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Surveillance, privacy, and the British press

Jonathan Heawood 

In the surveillance versus privacy debate that followed Snowden’s revelations, the UK government and the British press have been rather strange bedfellows.

In June 2013, the Guardian newspaper began to publish Edward Snowden’s account of mass data collection by the British and American governments. The revelations which followed led to public and political outcry across the world. But the reaction from the British press was almost more extraordinary than the leaks themselves.

Despite their routine proclamations of press freedom–which if it means anything, means the freedom to hold the state to account–newspapers such as the Mail, Telegraph, Times and Sun turned their backs on the Guardian. They ignored significant developments in the Snowden affair. And when they did turn their attention to the issue, it was to accuse the Guardian and its editor, Alan Rusbridger, of ‘betraying Britain’.

Two years on from the Snowden revelations, what should we make of the contretemps between the Guardian and the right-wing press? Is it just a function of political differences? Of course, the liberal left tends to be more suspicious of the security state than the right. But right-wing newspapers are quite capable of speaking out against state surveillance when it touches on their own interests. Witness the Save our Sources campaign, which–rightly–questioned the use of police powers under the Regulation of Investigatory Powers Act (RIPA) to gather data on journalists’ sources. The Sun was a vocal supporter of the campaign – but welcomed state surveillance of the general public.

So why is the majority of the British press so relaxed about mass surveillance? Why do they not associate this threat with the ‘300 years of press freedom’, which they hold so dear? Have they not read George Orwell’s Nineteen Eighty-Four, which explicitly links the death of freedom with the death of privacy? Even the United Nations (not always first off the mark where human rights are concerned) is able to see the danger here, as evidenced by the creation this year of a new special rapporteur on ‘the right to privacy in the digital age’.

Is the cognitive dissonance of the press a function of underlying resentment over the Guardian’s part in exposing phone hacking, and thereby bringing the Leveson Inquiry down on the heads of other newspapers? Certainly, newspapers which specialise in breaches of privacy are unlikely to celebrate our ‘right to be let alone’, as Samuel Warren and Louis Brandeis described privacy in 1890. They did not welcome Leveson’s recommendations for independent regulation of their own powers of surveillance. Why should they welcome the inconvenient truths published by the Guardian about data collection?

But the argument between the Guardian and other newspapers over Leveson is a symptom of an underlying issue here, not the cause. Some newspapers’ desire to snoop, and their embrace of state snooping, have a common root which is not so much ideological as commercial.

Look again at Edward Snowden. He not only revealed the state’s growing power to listen in to our every digital thought. He also exposed the complicity of the major ISPs and telecoms companies in this. He contributed to our dawning realisation that new media is not ‘free’, as it appears. It is in fact very expensive. And the price we pay is our privacy. Snowden helped us to understand that the interests of the ‘authoritarian’ state and the ‘libertarian’ new media giants, far from being divergent, actually converge on a shared holy grail: knowledge.

What knowledge do these strange bedfellows prize above everything else? Why, the things that we want to keep most private, of course: where we are; what we are doing; what we think; who we love; how we love; who we worship; what we believe; what we desire; what we can afford; what we can’t afford. They want to know our bank balances, our hopes, our fears, our corruptions and our innocent fantasies. Wouldn’t you, if you were trying to maintain order in a fragmenting world–or trying to sell advertising to it?

And what are the interests of news publishers in this world where knowledge is revenue? They are also increasingly driven by a hunger for private data. The collapse of the print business model is driving British newspaper publishers into global hyper-competition for a finite advertising market. News publishers need to sell advertising on a scale never before seen if they are to keep operating. In the digital economy, every click is worth slightly less than the last one. So the data which our online activities provide about our habits becomes an ever-more keenly desired commodity. This is as true of old media providers that seek to compete in the digital age as it is of new media.

Thus, it appears that the commercial interests of newspaper publishers are oddly aligned with the security interests of our governments. Ideology undoubtedly plays a part in press positions on surveillance and interception, but it is at least equalled by commercial considerations. These considerations may not be explicit, or conscious, but they contribute to a culture in which privacy is consistently under-valued, and the importance of unrestrained powers of data gathering is over-hyped.

The British press is quite capable of mounting an effective opposition to the security state when it treads on their own toes. But when it interferes with the rights of the public at large they seem to care rather less. In any case, as the former Chief Surveillance Inspector has recently commented, the media ‘often relies on the very covert techniques it criticises’.

Whatever Snowden’s motivations, and whatever the merits of the coverage in the Guardian and other liberal newspapers around the world, the substance of his revelations is overwhelming. Our governments, and corporations both old and new, with an unprecedented power to set the global news agenda, have the capacity to know more about all of us, in every aspect of our lives, than they have ever had at any time in history. And if that doesn’t pose a fundamental threat to our freedoms, what the hell does?/OD