Undoubtedly by now everyone who reads this blog piece will have heard statements like ‘data is the new currency’, or something along the same lines. From a practical lived-experiance perspective the analogies seems obvious. After-all, we pay for software apps and internet services by surrendering private information. It seems the only way to explain the massive stock market valuations of many internet companies.
There are however important ways in which data is very different from traditional currencies. When money is paid for a service there is a clear transfer of a value indicator (the amount of money of buyer is reduced and the amount of money of the seller increases by the same amount). When purchasing and app or service by transmitting of data (often of a personal nature), however while this clearly adds some kind of (potential) value to the receiving side, it is not at all clear how to determine if, and by how much, the transaction reduces the purchasing power of the buyer. Often this feature of the ‘data currency’ is a great advantage to consumers. After all, if means people can freely install all kinds of apps and sign up to large number of services without having to worry about running out of purchasing power. But what might the implications be for consumer protection or product quality? Even when purchased with money, software infamously often comes with disclaimers to the effect that the manufacturer does not guarantee that the software will perform any of the functions it was supposed to and increasingly depends on multiple post release bug-fix updates. In order to boost the trust that clients have in the quality of the products that are being sold retailers often choose to offer a ‘not good, money back’ guarantee. But how would this work if the product was paid for with data instead of money? The client does not gain anything by having data about herself sent back to her, so ‘returning data’ doesn’t make any sense, but then again, the quality guarantee in ‘not good, money back’ is really in the fact that the retailer stands to loose something if the product wasn’t good. So perhaps it is sufficient if the data is removed from the retailer’s systems. How would one know if that had really happened? How would one know that the data hadn’t been copied and monetised (sold) further down the business chain already?
Clearly a ‘try before you buy’ model would work much better. In PC software this model is frequently used with timed trial periods before a purchased activation code is required. For apps however this seems not to be the case, and for anything that involves some kind of social network function implementing a ‘try before you buy’ mode can be very challenging since the data to at is used to purchase that app (as ‘data currency’) is usually an integral part of enabling the app functionality. Is there a way to resurrect ‘not good, money back’ or ‘try before you buy’ product quality guarantees for social network apps? If you have some good ideas, let us know in the comments.