Last week the White House released its report on big data. While the report covered all aspects of big data, not just marketing’s use of big data, there were a number of implications for marketers.
The full report was provided in two parts. Below is a link to the report on opportunities and values with a Fact Sheet for those that don’t want to real all 85 pages. Also provided is a link to an accompanying report from the President’s Council of Advisors on Science and Technology (PCAST). I encourage everyone to read the summaries, if not the full report.
Technology is fundamentally reshaping how Americans and the world live, work, and communicate. It is driven by declining computing costs coupled with new digital sources of data, including sensors, cameras, and geospatial technologies. Add to this easier means to analyze all this data, and we enable important discoveries and innovations in a host of areas – including public safety, health care, medicine, education, energy use, agriculture, and more. These conditions also raise many questions about how to protect privacy and other values in a world where data collection is becoming ubiquitous, and data storage permanent.
The report does a good job of balancing the opportunities to seize the exciting benefits from big data, while pointing out the challenges in preserving our fundamental values.
We live in a world of ubiquitous data collection that is different from just a lot of data because of the 3 Vs – Volume, Variety and Velocity. Data, lots of it, is being processed in real-time. This creates wonderful opportunities.
- Big data is saving lives. We better understand how to identify infections that are dangerous, sometimes deadly, for premature infants. Data from a neonatal intensive care unit, showed slight changes in body temperature and heart rate were early warning signs of infection, subtle changes that experienced doctors would not typically have noticed.
- Big data also offers opportunities in diverse areas such as agriculture, global development, education, environmental monitoring, and climate change impacts.
- Big data is making the economy work better. Jet engines and delivery trucks have sensors that continuously monitor hundreds of data points and send automatic alerts when maintenance is needed. Utility companies are starting to use big data to predict peak electric demands, adjusting the grid to be more efficient and averting brown-outs.
- Big data is saving taxpayer dollars. The Centers for Medicare and Medicaid Services have begun using predictive analytics to flag instances of reimbursement fraud before claims are paid. The system identifies the highest-risk health care providers involved in fraud and abuse in real time and has stopped or identified $115 million in fraud.
While the opportunities from big data are considerable, big data also raises real concerns about how we protect our privacy and other fundamental values.
- Big data tools can alter the balance of power between government and citizen. Government uses have the potential to chill the exercise of free speech or free association. As more data is collected, analyzed, and stored on both public and private systems, we must be vigilant and revise our laws to ensure the balance is maintained between government and citizens.
- Big data tools can reveal intimate personal details. When multiple data sets from many diverse sources are merged, they reveal complex patterns. But this practice, known as “data fusion,” can also lead to the so-called “mosaic effect,” whereby personally identifiable information can be discerned from anonymized data. We must ensure that appropriate privacy protections are in place to protect individuals.
- Big data tools could lead to discriminatory outcomes. As more decisions about our commercial and personal lives are determined by automated processes, we must be careful that big data does not systematically disadvantage certain groups, whether inadvertently or intentionally. We must prevent new modes of discrimination, particularly in housing, employment, and credit.
The report had a number of policy recommendations, which were not new, but on which we have seen little movement. It says we must both encourage innovation and protect our values through law, policy, and the practices in the public and private sector. To accomplish this, the report recommended the following:
- Advance the White House Consumer Privacy Bill of Rights published in 2012 to provide clear, understandable, reasonable standards for how their personal information is used.
- Pass National Data Breach Legislation that provides for a single national data breach standard, along the lines of the Administration’s 2011 Cybersecurity legislative proposal.
- Extend Privacy Protections to non-U.S. Persons because privacy is a worldwide value that should be reflected in how the federal government handles personally identifiable information on everyone.
- Ensure Data Collected on Students in School is used for Educational Purposes to drive better learning outcomes while protecting students against their data being shared or used inappropriately.
- Expand Technical Expertise to Stop Discrimination because the federal government should build the technical expertise to identify big data analytical outcomes that have a discriminatory impact on protected classes.
- Amend the Electronic Communications Privacy Act to ensure the standard of protection for digital content is consistent with that in the physical world.
Specifically, the report called on the marketing data services sector (“data brokers”) to be more transparent and create a portal for consumers to communicate with these entities.
Since none of these are new, we will have to see how many of these recommendations are acted on.
Other key issues to watch include:
- Still awaiting the FTC report on their investigation into data brokers. It looks like it may be a while before we see it.