Ben Thompson makes a good point in today’s Stratechery Daily Update (paywalled) about Tim Cook’s privacy stance, and his comments about Google’s business model that I previously and half-jokingly described as “throwing shade”. Thompson writes:
First, it’s simply not true to say that Google or Facebook are selling off your data: what they are doing is promising advertisers they will display their ads to a particular type of customer as defined by the advertiser using Google or Facebook’s provided parameters. This may sound like semantics but the difference is significant: Google and Facebook do know a lot about individuals, but advertisers don’t know anything — that’s why Google and Facebook can charge a premium!
Second, Google and Facebook are highly motivated to protect user information. In fact, should Google or Facebook decide to sell your data, the value of each company would fall through the floor! Their competitive advantage in advertising is that they have data on customers that no one else has. In other words, if you consider incentives, Google and Facebook have more motivation to protect their users’ data from 3rd-parties than Apple does: money has a funny way of trumping morals (not that I question Apple’s! Rather, I’m just pointing out how wrong Cook’s implication is)
This is 100% right—Google and Facebook don’t sell your data, or in fact do anything that compromises your privacy for the sake of advertising. As Thompson points out, social media companies’ business isn’t selling you so much as selling access to you, in ways that are fairly transparent. The social networks I use most—Facebook, Twitter, Instagram, Tumblr—all run ads, all their ads are clearly denoted as ads, and all are (ostensibly) targeted.
Like most of you, I also see a ton of ads that can’t possibly be based on my interests, like the Kate Upton Game of War ads that just won’t go away no matter how often I click “not interested”. I can only suppose that the people marketing that game are going for quantity, bidding a lot for every possible slice of Twitter & Facebook’s 18-35 male user base. But see, that’s my point: even when advertisers could use social networks’ data to target me in a very personal way, they often don’t.
Cook wasn’t so much railing against what social media companies do with our data, but whether it’s right for them to make money from it at all. It’s not a question of private vs. public data, but which business is more moral: advertising, or selling hardware.