Sell Your Personal Data for $8 a Month
Would you let a startup track your social media accounts and credit-card transactions in exchange for cash?
A startup called Datacoup is far from the only tech company hoping to get rich by selling insights mined from your personal data. But it may be the only one offering to give you money for that information.
Datacoup is running a beta trial in which people get $8 a month in return for access to a combination of their social media accounts, such as Facebook and Twitter, and the feed of transactions from a credit or debit card. The New York City-based startup plans to make money by charging companies for access to trends found in that information, after it has been removed of personally identifying details.
Most people already trade their personal data every day. By typing into Google’s search box, or using a grocery store loyalty card, they get a free service or discount in return for letting marketers glean prized traces of their behavior. Now Datacoup CEO and cofounder Matt Hogan says he is offering a way for people to get involved more directly in the market for information about their activities. “If a consumer wants to make an educated decision, they should be able to sell their data to who they want,” he says.
Hogan says that almost 1,500 people have signed up during the beta trial, and that within a few months the service will be open to everyone. The company also might offer people the option of sharing data from lifelogging devices such as the FitBit or parts of their Web search history.
So far no advertisers have bought data from Datacoup, though Hogan says initial discussions have been encouraging.
Data on consumer behavior is hardly in short supply these days. It accumulates in the databases of social networks, ad networks, and wireless carriers, among others (see “What Facebook Knows,” “Ads Follow You Between Devices,” and “How Wireless Carriers Are Monetizing Your Movements”). But Hogan claims that what Datacoup collects can be especially useful to advertisers because few data providers can combine traces of a person’s online activity with a record of their spending activity. “Both of those are valuable; when you layer one on the other you unlock more value, and there’s no way to do that other than from the user themselves,” he says. Validation for this idea—and competition for Datacoup—comes from Twitter and Facebook, which work with data broker Datalogix to link people’s social media activity and the things they buy (see “Facebook Starts Sharing What It Knows About You”).
Alessandro Acquisti, who researches the behavioral economics of privacy at Carnegie Mellon University, notes that the idea of people trading their own data has been around for years but has never quite taken off (see “If Facebook Can Profit from Your Data, Why Can’t You?”). Author and computer scientist Jaron Lanier has argued for years that it is fundamentally unjust that people don’t see the profits made from their own information.
“Ethically, it makes sense that you know what is happening to your data and how an entity is using it and what the possible consequences are,” says Acquisti. However, Datacoup doesn’t really let people take control of their data, he says, since Twitter, Facebook, and the credit-card companies it connects with retain that information and can continue to profit from it.
Also, people deciding whether or not to take the startup’s deal must accept that they won’t know everything about how their data is used. For example, people might be happy to take Datacoup’s money today, but they would regret it if they knew that it would lead to their favorite online retailer deciding to hide discounts from them and show them more expensive products. “Measuring privacy trade-offs is exceedingly hard,” Acquisti says.
Hogan argues that encouraging people to think more about their data and its value could inspire them to demand more transparency from other companies that sell personal information. “We’re in the consumer’s corner,” he says. “I happen to believe that putting you in control of your own asset, your data, makes for a more efficient market.”