Personal data control worth £1.1bn a year to tech giants

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Users want to receive financial incentives if companies decide to collect personal data about them. Photo: Getty Images

UK internet users have said they would be prepared to hand over a combined £1.1bn ($1.48bn) per year to Facebook (FB) and Google (GOOGL) in return for greater control over how their personal data is collected and used.

A new report from consumer champions Which? found that many people are uncomfortable about the amount of personal data that is collected about them while online, and want to have greater control over its collection and use.

Which?, alongside Accent and PJM Economics, calculated the value consumers would put on being able to block targeted ads entirely, or the alternative of receiving a reward for seeing them.

The research found that while many people are concerned about sharing their personal data, a lot of consumers are open to seeing targeted adverts — particularly if they come with the offer of a payment or other financial incentive, such as an Amazon (AMZN) voucher.

Given a hypothetical choice of receiving targeted adverts or paying to receive generic ads, respondents told Which? they would be prepared to pay an average of £1.09 a month to only receive generic adverts and for their data not to be collected. Aggregating this for all UK users of Google and Facebook for a full year gives a total estimated value for this choice of more than £1.1bn.

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When asked to choose between generic adverts or targeted ads and receiving a monthly reward, the average respondent said they would need to receive rewards worth £4.03 per month to choose targeted ads. Aggregated across the UK, this gives an annual total estimated value of £4.21bn.

In the absence of any financial incentive, only a quarter (27%) of Google and Facebook users said they would prefer to receive targeted adverts. However, when a financial incentive was added, that figure went up to four-fifths (81%).

Unsurprisingly, the survey found that the larger the financial reward, the more likely consumers were to choose targeted adverts.

Which? has called for powers of the new Digital Markets Unit (DMU), which operates out of the Competition and Markets Authority (CMA) to include the ability to compel the biggest online platforms to give consumers a simple and understandable choice to control how their data is collected and used.

“The introduction of greater choice and control for individual users would not only empower consumers, but would also stimulate competition in digital markets to ensure challenger businesses can compete viably with tech giants," said Rocio Concha, Which? director of policy and advocacy.

Both platforms do offer services which allow users to control some elements of data collection and use. For example, Facebook’s ‘Off-Facebook Activity’ tool allows users to monitor and control online tracking. However, Which? research found that only 11 per cent of Facebook users were aware of this tool.

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Google offers users more control as they can choose not to receive personalised adverts, but concerns were raised by the CMA relating to the complexity faced by consumers wanting to exercise this choice. Which? research found that only 17 per cent of Google users had changed their settings and some of these clearly demonstrated they did not understand the choice they had made.

Some people feel the collection of their data is simply “the price you pay” to use these everyday sites.

However, many respondents became much more uncomfortable with the nature of data collection as they became more familiar with it, calling into question the legitimacy of the current model for targeted advertising.

“The new Digital Markets Unit must be empowered by the government to introduce remedies that promote competition and reduce consumer harm," said Concha. 

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