The commercialization of our data paves the way for an asymmetrical redistribution of power, with the advantage going to those actors who both have access to and the ability to make sense of the information. I investigate the development of data capitalism between the middle of the 1990s and the middle of the 2000s, as well as the crucial role it plays in the modern information economy. The beginning of the rise of data capitalism coincided with the introduction of the Internet and the beginning of the dotcom bubble in the middle of the 1990s. I investigate the consumer Internet industry as it went through a period of expansion beginning in the early 1990s and continuing into the early 2000s. This expansion began with the advent of the Internet itself. I investigate the history of tracking technologies used in the private sector, concentrating primarily on how these technologies were conceived of and what it was anticipated that they would accomplish. I take a closer look at the market ecosystem that developed in response to the commoditization of data and delve further into the texts that were produced by and about market players.
In this piece, I trace the origins of data capitalism all the way back to the 17th century and continue through the early 1990s. The concept of 'data capitalism' refers to the way in which the market invests data with new forms of informational power and then capitalises on this power while at the same time making this power invisible in the name of transparency and improving the efficiency of consumers.
Within the context of the information age, the redistribution of power is made possible by the commercialization of our data. There are many parallels to be drawn between surveillance capitalism and data capitalism. ASurveillance capitalism is 'an emergent logic of accumulation' of digital traces. He makes this argument in his article. The revelations made by Snowden have prompted people to wonder how something like a 'tracking universe' came into existence. My goal is to discuss the repercussions that have resulted from the transition from an online retail model to a model of advertising that is predicated on the purchase of audiences. The term 'data capitalism' harkens back to an earlier period in the history of the media, specifically to the time when the penny press prevailed over partisan newspapers.
The historical beginnings of data collection on a mass scale can be traced back to early attempts to quantify human behaviour. The nineteenth century saw the beginning of the development of surveillance networks by commercial credit reporting agencies. During the 1950s and 1960s, there was a surge in the use of surveys and polls, with the goal of making the 'mass society' of the post-war era more understandable.
In 1997, estimates of the amount of money that consumers spent online ranged from less than one hundred million dollars to more than one hundred million dollars per year. A great number of dot-com businesses exaggerated their achievements in order to fulfil the essential requirements for venture capital investment. The bursting of the dotcom bubble was brought on by a convergence of factors, the most important of which was a slower-than-anticipated shift online.
Every time a user logs on to a computer, clicks a link, registers for a website, or sends an email, a trail of data is left behind on that device. It was necessary for companies to make the most of the network effects that could be accomplished through the use of their platforms. Gaining command of the databases that house the information provided by users would enable one to dominate the market.
Cookies were heralded as a revolutionary innovation in the early days of the World Wide Web due to their capacity to make surfing the web a more individualised experience. Others were concerned about the potentially intrusive nature of these newly developed technologies. 'The issue of privacy is one that needs to be discussed because it is at stake.' Bell Laboratories' David Kristol and Netscape Communications' Lou Montulli were the two individuals. In a test conducted in 2010, journalists at The Wall Street Journal discovered that the top 50 most-visited websites on the Internet had installed more than 3,000 tracking files on their personal computers.
In 1995, the United States Department of Commerce made a proposal for a framework that would notify users about how companies intended to collect and use their information. This framework would be voluntary. Businesses were able to innovate more quickly thanks to the voluntary approach, and there was more room for trial and error. In addition to this, it meant that legal challenges and actions taken by the government to enforce laws were significantly hampered during the formative years. European privacy regulators have had more success than their counterparts in the United States in putting early limits on data collection.
The collection of online data sparked the rapid development of a new industry, which included data brokers as an important participant. As a response, advertisers could target specific audiences with their advertisements or personalise the user experience. Advertising companies and web browsers are fighting for dominance. Web beacons give the impression that a persistent effort is being made to monitor the behaviour of users. Web beacons make it possible to track an enormous amount of data regarding the activities of a user on a website. Even as far back as 1997, Wired highlighted the fact that the privacy invasions caused by the data broker industry were a 'missed story.'
The market for consumer data is estimated to be worth 156 billion dollars, with data exchanged between companies accounting for 71 percent of that value. If the preeminent role that these companies play in the tracking ecosystem is analysed, perhaps more light will be shed on how data capitalism is materially instantiated through the products that these companies create.
In the early 2000s, when many internet companies were trying to find a solution to the problem of how to make money online after the dotcom bubble burst, Google was perhaps the most successful of these postbubble Internet companies. The company achieved a major milestone when it figured out how to generate revenue for its online operations by converting the data that Google collected from various locations on the web into content-specific advertising. The advertisements that are served up by AdWords alongside search results are done so in plain text. When a user clicks on an ad, AdSense will install a small piece of code on that user's computer in the form of a cookie. This allows the advertiser to track the user's behaviour after they click on the ad.
Google's advertising business took advantage of the most advanced tracking technologies available on the web to deliver ads that were extremely relevant to the preferences and actions of users. This information may include a user's name, email address, phone number, credit card number, and browsing habits, among other things. The lofty rhetoric that Google uses to justify its substantial financial interest in expanding its ad network is supported by this fact. The value of data to the company is directly related to both the company's corporate culture and the revenue streams it relies on. For instance, Google is able to analyse the contents of users' emails and deliver advertisements that are pertinent to the text that is found in those emails.
A lack of integrity can be illustrated by the fact that a person has more than one identity. Facebook mandates that users provide their 'real' or 'authentic' names during the registration process. Because of this policy, members of some communities, including transgender people and Native Americans, have been subjected to discrimination. Companies such as Google and Facebook maintain a high level of secrecy regarding the procedures and systems that are utilised in the execution of their business objectives.
Sergey Brin and Larry Page, the founders of Google, held the belief that openness and the availability of information should be the public values that guided the development of Google's technologies as well as the company's business policies. This lofty rhetoric is supported by a substantial commercial interest in expanding its ad network. That hasn't received the same level of support in other countries as it has in the United States. The value of data to Google is inextricably linked to both the company's internal culture and its primary source of income. After establishing its dominance in the search industry, Google turned its attention to finding profitable uses for the information it had gathered through its search operations. Since then, it has adopted a strategy analogous to this one in order to broaden its selection of online products. The requirement that users of Facebook accounts use their real names has led to discrimination against transgender users and Native American users. A lack of integrity can be illustrated by the fact that a person has more than one identity. It is possible for data holders to match end user activity to personal information.
In spite of the fact that Google and Facebook appear to place a high value on openness, the companies guard their business procedures as if they were their most valuable trade secrets. Only a select group of technology giants and national governments have access to the necessary hardware and software to sift through the enormous amounts of data they collect and make sense of it. The success of Web 2.0 companies was largely dependent on the adoption of three different technological utopian narratives. The success of data capitalism is contingent on the ability to cultivate productive relationships between humans and machines. It's possible that quantifying and profiling the public will make it possible to tailor online experiences, but it'll also contribute to greater inequality in the process. The shift toward consumers wielding the majority of power in the digital sphere is a welcome development. There are only a few people who have the ability to accumulate, store and make sense of data generated by the general population. Despite the fact that data may be powerful, this ability is not widely available. Users are placed in a difficult position because they are torn between their desire for privacy and their ability to participate in meaningful online communities.
The ideological valence of the term 'virtual community' made it especially appealing to the business world as it began to circulate in the general public after it had made its way into public circulation. If a company could persuade its customers that they were participating in some sort of social endeavour rather than an economic one, then the company would be able to increase both their customer loyalty as well as their own profits. Set them at liberty. But you should also require them to collect it in ways that are increasingly intrusive and covert. The shift toward consumers wielding the majority of power in the digital sphere is a welcome development. There are only a few people who have the ability to collect and make sense of the massive amount of digital traces that are produced by the general population. Despite the fact that data may be powerful, this ability is not widely available.
Ashly Chole - Senior Finance & Technology Editor