Whose Life Is It, Anyway?

To hear it from the Federal Trade Commission, an online data collector is an awful lot like a Hollywood paparazzo. Companies that track and collect online consumer data can act like “invisible cyberazzi,” said FTC chairman Jon Leibowitz during a speech at the National Press Club in October. The chairman, while noting that he doesn’t want to “pull a Sean Penn” and get rid of behavioral targeting, said, however, that these companies, hidden in shadow, trail people on the Web, nabbing personal information and snapshots of activity that they then share with marketing firms.

There’s another way in which this exchange of consumer data is like the trafficking of celebrity snaps: It’s a big business. Each year, companies in the U.S. spend more than $2 billion on third-party consumer data, according to Forrester Research. Add in the money spent on credit data, market research and other kinds of derived information, the research firm says, and you’re looking at a multibillion dollar industry. In fact, the volume of digital data created by consumers is growing at such a fast clip that the World Economic Forum and other futurists have called personal data the “new oil.”