Commentary

Are Consumers Losing The Data Game?

Even if it’s just more relevant ads, are consumers benefiting from the collection of their digital behavior and personal information?

Not likely, according to Bob Gellman, a privacy and information policy consultant. “Economists have begun to look at some of these [data tracking and collection] activities, and they’re finding that all the benefits go to the companies [doing the tracking and collecting] and the consumers get hardly anything out of this,” Gellman told attendees of MediaPost’s The Reckoning conference, on Tuesday.

It’s more likely that most consumers will lose by surrendering their data, Gellman said. Referring to the notion of price discrimination, he explained: “One of the fears is that -- if you start looking at economists’ supply and demand curves -- the consumer surplus that comes as a result of standard consumer pricing will begin to disappear as companies can target individuals and set prices based on those individuals rather than others.”

“Another concern is that all of this data will end up being used in other ways that aren’t anticipated -- so all of a sudden the data will be used to deny your ability to get on an airplane,” Gellman added.

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