Commercialism and Privacy

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Commercialism and Privacy

Summary

Industries gather information about consumers, and advertise to consumers that go greatly beyond what is acceptable. We do not own our own information, and Spam, like calls from telemarketers invade our privacy. However, there are market solutions to these problems that will hopefully allow us to regain what is ours.

Introduction

Commercialism has intruded into just about every part of our existence, and e-commerce has propelled this intrusion exponentially. Commercialism is not necessarily bad in itself, but because of industries' insatiable desire to gain the competitive advantage, they gather information about consumers, and advertise to consumers that go greatly beyond what is acceptable. Firms have invaded our privacy, and consumers are fed-up with this invasion. Consumer rebellion will open the doors for market solutions to these market problems.

Anonymity

Every time we sign up for a free email account, fill out a survey on line, or request free information, we give away a little bit of information about ourselves. Simply visiting a web site provides valuable information to industry about ourselves. Each incident in many cases is not significant, but the accumulative effects of the information can become serious intrusions on our privacy. The accumulation of this information provides firms profiles of existing and potential customers. Consumers are becoming very wary of this loss of privacy and anonymity, and feel that these profiles belong to the consumer, not the firm.

One method of gathering information about a consumer is the Internet Service Provider. ISPs knows who you are and knows every web site you visit. Consumers have complained about this, so some ISPs have advertised that they will not to sell your web surfing information. AOL at one time stated that they do not gather information on their customers web activity at all, but they may have changed their mind, because there is no evidence of this claim on line. As people become more concerned about their privacy, demand for ISPs that provide the consumer greater anonymity while web surfing will dramatically increase. ISPs are not the only companies that gather information. Other firms besides ISPs use various means to track consumers activities on the Internet for sell and use. Now, companies like Anoymizer.com and Evidence Washer sell software that protects your Internet privacy. The fact that these and many other companies sell this sort of software shows there is a growing demand for privacy protection. Using ISPs that do not collect information about you, and using software to prevent other companies from collecting information about your web activities are only two possible solutions.

The most powerful market solution to privacy on the Internet will occur when people stop voluntarily giving away information about themselves. Once consumers become wise to getting free service or information from a web site, they will stop giving up the information.

Spam

Email used to be one of the most efficient means of communications. One could read and reply to ten emails in the time it took to have one telephone conversation. Email was a great convenience because one could read and send emails at his leisure. Not any more. As more and more people began using email, businesses realized that email was a great advertising medium. It could reach millions of people almost instantly at virtually no cost. Because of commercial Spam, email now invades our privacy and wastes our time. This is a major problem.

Since reading email has become more of a burden than in the past, consumers may simply dramatically reduce or quit using email for communications. This solution will reduce the number of hits or reduce the number of available email addresses for Spam to be as effective. Because Spam email has an extremely low marginal cost, there does not have to be many people for Spam to be profitable. There is not much difference between one hit in one hundred thousand and one hit in two hundred thousand, when the cost remains about the same for both. But this solution may force many Spam advertisers to drop out of the market.

The market has provided other solutions for an attempt to stop Spam. Just about every ISP has an email option to reduce Spam with various filter and options. Also, email programs have filters to reduce Spam. Programs like Spamkiller and MailWasher have become market solutions to reduce the intrusion of Spam. Since Spam is still a very important tool that many advertisers want to use, Spam firms will make every effort to bypass Spam software and filters. There will be a constant battle for the anti-Spam software companies to keep up. This will also require users to constantly upgrade their software, which will generate profits for the anti-Spam companies. So, more Spam means more profit for anti-Spam companies. I suspect it would be profitable to be a Spam advertising provider and anti-Spam software provider, because the firm would generate revenue from both markets.

The United States Postal Service will soon start selling guaranteed email for a few cents. This could be yet another solution to the Spam email problem. With people applying software, filters, and exception lists to their email accounts, many legitimate emails may not get through. However, if FedEx, UPS, or USPS provides a guaranteed email service for a fee, users could allow the fee based emails to come through, because advertisers could not afford to send 50 million Spam emails. This would dramatically increase Spam advertiser marginal costs. Even if it only cost two cents to send a guaranteed email, the cost would be prohibitive.

Conclusion

Lack of on-line privacy, and unwanted emails invades our privacy because of excessive commercialism, is a serious problem. With a combination of paid for services, software, and a change in behavior, users can dramatically reduce information gathered on them and slow or eliminate Spam. This will costs firms, and will reduce their profits enough to force many of the them to drop out of the market.

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