What is a data dividend?
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While you’re in an elevator, walking to work, sitting in your doctor’s waiting room, or laying in bed getting ready to fall asleep, we avoid human interaction and get on our phones. The in-betweens. The little time we have in between the time we do stuff. That’s when we spend a lot of time looking down at our devices. Reading, sharing photos, and commenting on posts from our friends, family, or co-workers. All of this time adds up. So how much time do we spend on social media per day?
According to GlobalWebIndex, in 2018, adults (18+) spent an average of 2 hours and 22 minutes on social media per day! Nearly 10% of our day is spent on social media…almost 17% of our waking hours!
What’s more, the younger you are, the more hours you are spending on social media. That means as the population ages, we will expect to spend more time on social media and content created on social media. This is not the total time we spend online…it is the total time we spend on social media alone.
What is it that we are reading? It isn’t necessarily articles written by newspaper journalists or videos written by television script writers. It is usually posts, photos, videos, and comments written by or shared by our friends, families, and co-workers. Content created by us. Even by simply reading/watching and commenting, we are feeding data back to the social media sites, telling them what our interests are and giving them insights into who we are. When you use these sites, they need to make money to pay their engineers, servers, bandwidth, and various other costs in addition to making a profit (these are not non-profits, after all).
We are pointing out social media as a use case but in reality, this applies to most websites that are constantly monitoring your activity, tweaking their products to maximize usage and profits. It even extends into the real world. When you use your grocery store loyalty card and/or provide them with your phone number at the cashier, you are getting that discount for a reason. There has certainly been a lot of back-and-forth about the Privacy Paradox: Users want to use apps and websites for free but are not willing to trade their privacy for sites to make money to continue providing the site or app for free. Additionally, there are some services that use your data even if you never used them. Several apps have been caught tracking your location constantly and selling where you go and where you sleep.
However, why are people complaining about giving up their data when they are getting these free services? The data about you should be owned by you. The question doesn’t necessarily become about profiting off of your data. The question is a matter of choice. Choice cannot exist without transparency. When you download a health app to store the medications you use or track your pregnancy, these apps turn around and sell this info and the buyers are tying it back to you in order to decide how to make more money off of you by, for example, showing you ads relevant to your health. The part that disturbs consumers is they didn’t know it was happening. This is where transparency comes in. Consumers should have the option to make the decision whether or not this data can be shared but they cannot do so without the knowledge that this is happening. Furthermore, consumers must be compensated in order for others to profit off of their data. It’s not fair that someone might make money as a data broker who has aggregated data about you as a user even though you have never indirectly interacted with them. It’s not fair for others to use your very private and sensitive information to sell to others without your knowledge.
Most people first heard about data dividends when Governor Newsom of California (the home state of many tech companies) stated during his State of the State speech, “California’s consumers should be able to share in the wealth that is created from their data” and even referenced the term “Data Dividend.”
A dividend is money that is paid by a company to its shareholders, usually out of its profits.
A data dividend is money that should be paid by a company to consumers out of the profits they made utilizing the consumer’s data.
The governor’s office said they are working on exactly how they will propose doing this. It is unclear how much money that will be, which companies it will apply to (does it go beyond tech companies?), and when it will begin.
Control.My.ID believes that consumers should make a data dividend off of their data and engages with enterprise & corporations to get them on board with our model. Make sure to sign up and opt-in to receive your data dividends as we launch our data dividend model.