For now, news about the NSA surveillance will at least heighten consumers' awareness about online privacy, according to Brian Wieser at Pivotal Research Group. “If few consumers were paying attention to debates regarding the use of personal data between corporate participants and a handful of regulators, it seems almost certain that many more will be doing so now,” he predicts in a new report.
Wieser adds that if those concerns spur new regulations, one result could be new limits on data collection. For instance, he says, companies might start seeking “formal consent” from consumers before collecting their data. Notably, privacy advocates have said for years that companies should do more to obtain users' explicit consent before gathering information about their Web activity.
Wieser says that a “formal consent” system could be an improvement from the current opt-out regime, because companies that ask for permission to collect data can explain that free content often is supported by ads. Doing so could “tighten the commercial compact between consumers of media and its publishers,” according to the report.
Of course, that's assuming publishers offer content for free. But these days some publishers, particularly news sites, collect consumers' data and also charge for access.
Regardless, Wieser goes on to predict that new limits on data collection by ad networks and other third parties could increase the power of first-party publishers -- like Amazon and Apple -- that collect data directly from consumers.
“Our guess is that any further efforts to regulate the industry will probably have the effects of further empowering today's incumbents in digital media, especially Google, Facebook, Yahoo, Microsoft, Amazon, eBay and Apple, because their data will now make them more directly important to advertisers,” the report says.
That view seems to be gaining support. Federal Trade Commission member Maureen Ohlhausen has made similar comments on at least two occasions. Most recently, speaking at a conference of the trade group Digital Advertising Alliance she warned that “reducing the flow of information in the marketplace” could impose barriers to entry by precluding new companies from “obtaining valuable information that incumbents already possess.”
Several weeks prior, she said that new privacy restrictions “may have an effect on competition by favoring entrenched entities that already have information, over new entities.”