A Conversation on Surveillance, Regulation, Data and Its Economic Model, Privacy, Reputation and Consumer Trust!
On October 5th, the 3CL Foundation in collaboration with Spazju Kreattiv and the Faculty of Media and Knowledge Sciences (University of Malta) hosted an audience with Joe Toscano. Toscano, who was featured in the popular Netflix documentary ‘The Social Dilemma’ and has authored the book ‘Automating Humanity’ is an ardent advocate of digital and data literacy.
Who is Joe Toscano?
Toscano has been vocal on the topic of the importance of becoming digitally literate for the last six to seven years. He has been giving talks and raising awareness on the subject on a global level. But what actually led him to it?
Born and raised in Nebraska, which in Toscano’s own words is ‘five to ten minutes from Farmland’, he grew up disconnected from anything internet-related. Nebraska was quite backward in comparison to other states. A Math wiz from a young age, once he felt he had peaked in Mathematics, he decided to pursue psychology and try to understand how it links with human behaviour and commerce.
He took his Math skills and applied them to learning code and became self-taught after that. Once he made the move from Data science to engineering, he realized that language learning and AI were imperative to master, as coding was soon to write itself.
He became a UX designer who codes, designs, and speaks business. Google saw his potential and snapped him up. He knew how to bridge and coordinate different aspects of the tech being built and could make it much cheaper.
The Importance of Data Literacy
Around a few months after he started his job at Google, Toscano realized the scale of what he was doing – building a tech design for billions of people, based on consumer behaviour. The questions asked and the data given by users in response validated and facilitated the algorithm; thus, instigating Toscano’s increasing worries about surveillance. He left shortly after that.
He sold everything he had and started driving everywhere to the point where he broke his lease in San Francisco. He lived out of his car for two and a half months and started building a network of people who were ready to hear him out.
Over time, the number of people willing to hear him out started increasing. He is unphased by the popularity of ‘The Social Dilemma’. The documentary has now reached a billion and a half views, which means that society is concerned and becoming increasingly literate enough to understand the severity of the problem.
After leaving Google, he authored ‘Automating Humanity’ and consulted around 35 US State Level attorneys on anti-trust cases, monopoly law and Facebook and Google. He has helped draft privacy laws in a number of states as well as a taxation system in New York. He is now the CEO of Datagrade. The company’s purpose is to monitor, evaluate and assess the risk and value of data on the internet.
Invisible Threads in The Age of Surveillance
What a lot of people have failed to realize is the peril of being constantly tracked. Whether you are reading on your Kindle, using your phone on the train, jogging using your Fitbit or Strava, using your robot cleaner, or even standing and staring at the large screens at the bus stops or in the subway, your data is being traced.
Your Kindle keeps track of the books you are reading and what you are highlighting, your phone on the train knows where you are located and the platforms you are logged on, your Strava is tracking your jogging route, and your robot cleaner just like your WIfi is mapping out your home and taking pictures of your home.
The longer you are using a particular device, or you are on a particular platform, the more data is being analysed and data has value. Data is money.
Toscano mentioned how his company, Datagrade, surveyed and carried out an analysis of the Californian department of Motor Vehicles to see which organizations they were sharing data with. It wasn’t just the standard data trackers but they discovered the involvement of insurance companies, such as the ones related to the Highway Safety. The DMV is now a full-profit entity, having even made around 50 million dollars sharing people’s data. And it’s not the only one!
With more companies becoming fully digitized, there is more data coming from every place imaginable or unimaginable. A simple product purchased on the internet may be useful for the user for a particular reason, but its full intent is only for the designer of that product to comprehend.
In the EU, the implementation of the GDPR grants its citizens more protection in relation to privacy; however, for the rest of the world the fact remains that companies have no legal requirements to report anything. Should there be control over how companies share data?
Toscano disagrees! “ I think sharing data is one of the most useful and valuable things we can do on the internet and the one thing that makes the internet valuable to us.”
That is why we need to look at all the aspects involved from the Attention Economy, to what is happening to our data, privacy, reputation and consumer trust.
The Attention Economy: Always Known as Data for Profit
Toscano explained to anti-trust investigators how these big tech companies such as Google, Facebook, TikTok, YouTube, Gmail, Insta, Twitter, Google Maps and Chrome create an addictive interface based on human psychology and behaviour, making the users pay more attention and stay hooked to their apps and platforms.
When they increase the attention, they are boosting their value and can price gouge. Millions of people around the globe are making thousands of dollars a day creating fake news for people to click on. Facebook allows it to proliferate because it is in their interest: they want your money to create data.
Would they create content or change data if it cost them money? Toscano does not think so!
The way U.S. regulators saw the economy before this was that the cheaper service offered to the consumer was the best. What these big tech companies do is make users pay attention through clicks, engagements, comments, and sharing. This turns into data and data is then reverted into money, profits, and revenue.
Toscano argues that what such companies are doing is not that different from money-laundering. Money laundering is when illegitimate assets are turned into cash or a legitimate asset. What is happening with tech companies is that they turn an illegitimate asset of attention and turn it into an illegitimate asset of data, which can then be legitimized into an asset of cash.
They have so much power and money because more or less they have created their own marketplace with their own rules. No one has any insight and there is no transparency either. They name their own price as well.
The reason why Toscano left was that he saw data was being misused in terms of value. It would cause trauma to economies around the globe and carry financial repercussions causing seemingly secure jobs and systems to crumble.
Data Storage and Regulation
Toscano says that if we argue that data is money, then we need to treat data like a financial transaction. However, would a serious business not know where its money has gone? These tech companies treat data like a massive oil spill in the ocean and in order to clean it, they have to understand where the debris and the liquid are coming from and where they need to go. They are not in control of where the data is coming from and where it is going.
When Facebook faced Congress, they were asked what information Facebook stores about its users and where it is. The director of engineering stated that there wasn’t a single person that could provide that answer but they would be able to if they had a team.
This meant that:
- They had no idea what was happening with the users’ data.
- They could do it with a team means that they did not have the financial incentive and the motivation to do it. This needs to change according to Toscano. It’s not how data is used that needs to be controlled but the type of data they are collecting, who the users involved are, and how long they have been collecting it. This is aligned with how we report our taxes.
If you look at the fines incurred by the GDPR law in 2018, the total amounts to almost 450K dollars. However, that number went up to nearly 3 billion by last year. This difference shows that regulators can make money out of this, and that people are actually getting scared. Enforcers are also getting smarter!
Toscano believes that regulation by itself is not much of a solution. Let’s say Google is taken to court. It takes 3 to 5 years to just lay out and define the problem. Then they go back to court to fight it. Google has billions of dollars. If they are going to be in court for 10 to 15 years fighting a 5 billion dollar fine, chances are that if their lawyers are very good, which they are, they will get the fine reduced to 500 million. During that time, Google would have made a trillion dollars. Regulation in this case won’t be very effective!
Privacy, Reputation and Consumer Protection
Companies need people for data as much as users need companies. If these big tech companies do not have data from users, their value begins to drop because the data starts getting old and it becomes no longer useful.
There is also the distinction to be made between a hack and a privacy breach. A hack is a security issue. What happened with Cambridge Analytica was nothing short of a privacy breach. It was not a great hack!
Privacy could affect anyone to anything like soldiers running and jogging using Strava and unintentionally exposing a military base, uncovering its risk. That is reputational impact. The mistake that many of us make is looking at the companies we share our data with when in reality we should be concerned with who those same companies are sharing data with.
Apple is pushing for more privacy controls and it even has an email masking system built into it. It needs to keep pushing the privacy pedal as it is a hardware company while Google is a data company. Apple cannot compete with Google when it comes to the amount of data stored.
In addition, Apple has their own advertising system, which has seen its advertising revenue increase tenfold in the last couple of years. What they can do is sell privacy. Its users use their service and all the data is stored within the Apple ecosystem. This means they have the potential to sell your data.
How do we combat this problem?
Toscano suggests that what can change the game is a generational shift, the way we understand technologies and the increase in data literacy. In China, new technologies are in the form of jackets or scarves, or hoodies protecting citizens from surveillance.
Other methods that one can engage in is typing in a false name and a false address when signing up for a service. While this is still legitimate, it decreases their chance of targeting you accurately. Over time when feeding them data, the previous data would have already been tainted so their data becomes less worthy and less valuable.
An audience member commented that this sounded contradictory to what he had said before. Sharing data on the internet is only useful when there is real, truthful, and valuable information to be shared, not when the information is fake and poisoned.
Toscano answered that while he agrees, there are other tools that are safer to use. In his case, he uses Plausible analytics instead of Google analytics, and therefore, it is in his interest to use the former at the cost of the latter. He argues that there are new companies coming out. Innovation and technology is getting cheaper to build and there is a no code to low code movement, making it easier for the average Joe to engage and build applications.
Toscano believes there are potential solutions to combat disinformation. We could start from data literacy in classes. And then proceed to:
- Going back to chronological timelines that are not algorithm-based;
- Create a distinction between in-line, or native advertisements. Toscano believes that an ad following 3 to 5 posts creates confusion in the mind and boggles the timelines. Advertising as a revenue model is not a problem but advertising as the only revenue model is.
- Creating one type of content that is not hard to follow and that does not alter my perception of reality. There is not much difference between education and advertising right now on the internet and users are having a hard time trusting basic information. This needs to change.
Toscano predicts that we will no longer have physical jurisdictions as part of the discussion. In terms of internet infrastructure, we are more likely to have internet jurisdictions, such as the US internet, the Chinese internet, the EU internet, and the Dark Web.
Toscano argues that we cannot go back to complete disconnection like before. It is impossible now! What we need to do is become digitally literate and make sure our kids become digitally and data literate as well.
In terms of the future of big tech companies, Toscano sees Facebook dying a slow death and that is why it has moved to Instagram and that META is struggling to appeal to younger generations. With regards to Amazon, there is already a big divide between Marketplace and store so the company will most likely break up. Google will become like IBM – it will be replaced by other technologies but will serve as the backbone of most other platforms.