Andrew Curry writes:

The current row over Facebook’s successive changes to its privacy settings has several strategic implications for the way that businesses – not just in the digital sector – relate to their customers. In case you’ve missed the story: Facebook has radically reduced the default privacy settings for its users since the autumn of last year, meaning that users are likely to be sharing far more details across the internet than they previously did. (I’ve written about this at length elsewhere, but a visit to ouropenbook.org gives a sense of the scale of it.)

The reason? Well, the company says that ‘radical transparency‘ is good for you, in a moral sense. Others say that it is part of a long campaign by Facebook (two steps forward, one step back, according to Nick Carr) to set itself up as the owner of its users’ online identity, which is a more lucrative proposition than being a mere social network, even one with several hundred million members.

So what are the implications of this for businesses?

#1: When the mental map which your customer has of your product or service becomes too divergent from their experience of it, the business suffers. (This is what happened when Gerald Ratner described one of his company’s products as ‘crap’). In the case of Facebook, the actual experience is no longer represented by the map. The researcher danah boyd has explained this well:

A while back, I was talking with a teenage girl about her privacy settings and noticed that she had made lots of content available to friends-of-friends. I asked her if she made her content available to her mother. She responded with, “of course not!” I had noticed that she had listed her aunt as a friend of hers and so I surfed with her to her aunt’s page and pointed out that her mother was a friend of her aunt, thus a friend-of-a-friend. She was horrified. It had never dawned on her that her mother might be included in that grouping. Over and over again, I find that people’s mental model of who can see what doesn’t match up with reality.

#2: Privacy isn’t dead, although it is fashionable for digerati to say so. People still expect organisations they do business with to maintain appropriate levels of privacy – and to be able to check these for themselves. We think that this expectation increases as the web becomes more ubiquitous and more portable, and there are more opportunities for breach. At least some users will engage reluctantly because of fear of theft, fraud, or inappropriate social exchanges. In the digital world, companies which take care of their users’ privacy will be less profitable in the short-term, but more sustainable in the long-term.

#3: Facebook is effectively polluting the “commons” represented by the internet – all of the public resources and protocols – through self-interested behaviour. It is possible that other suppliers which also depend on a trusted internet for their business will intervene; Google, its own privacy problems notwithstanding, has done a little of this recently. But usually what happens when public interest goods are polluted by commercial interests is that regulation follows. The cases brought against Facebook under trade and competition law, along with the initial responses from privacy regulators, are harbingers of this.

The cartoon at the top of the post is one of a string of acerbic strips about Facebook at the excellent Joy of Tech, and is used here with thanks. You may enjoy this one as well.

Denise Hicks writes:

Next time you’re in a changing room or at home wondering if those shoes really go with that dress, don’t fear. Help is at hand online. Sign up to ‘Go try it on‘, post a pic of your questionable outfit, and receive instant feedback.

It’s an interesting idea in theory, and a great example of how the web is enabling users to solicit instant advice from online networks. However, it seems to fall into a similar trap as most online ‘forums’, which is that you don’t have any idea about the validity of the opinions offered.

Putting aside the fact that most people probably use it to confirm what they’re already thinking (be it positive or negative),  why should you listen to what Jennifer C, or Alexa F, or any of the other 200 participants think? If there’s a debate going on, who do you trust? (Especially when there’s a penchant to say ‘change it’ rather than ‘keep it on’, for the sake of it).

There must be a way for these comments (and similar binary opinions on other forums) to be filtered via an attitudinal profile at the outset, so that you can prioritise the feedback of those who share your attitudes.

Certainly retail sites, and some restaurant reviews, are aggregating and cross-referencing previous feedback and purchasing data to help filter and edit your shopping choices. And sure, it may not be relevant for sites like YouTube that are geared towards capturing mass opinion. But still, if my mates aren’t there, or can’t be relied upon to give an honest opinion on my fashion sense, I want to know what ‘people like me’ think. Not the opinions of people who bought similar stuff, or the ones that most people agree with, but the ones who share my outlook on life, fashion and the universe – a group I can consider my ‘advisory panel’.

So when I’m told that ‘the puff sleeve with the high boat neck makes for too much bulk’ around my face, I can think ‘y’know what, Fawn G, you might just be right’.

The picture at the top is from Go Try It On, and is used with thanks. In case you’re wondering: Julia N needs an opinion on a super-casual look at her work.

The industry for personal informatics is certainly one to watch. There’s even been talk of a ‘movement’ and unsurprisingly, the iPhone has spawned a host of personal informatics applications. These applications are tantamount to an omphaloskeptics’s dream: pretty much any variable of life can be tracked to the most granular degree. Users of personal informatics sites can log everything from vegetables consumed and number of migraines suffered to variations in mood and their feelings about particular places.

Perhaps evidence that consumers are seeking certainty in these uncertain times, the sheer number and variety of personal informatics applications suggests not only a rising interest in self-analysis (or an increasingly narcissistic society) but a desire for more control over one’s personal life. For starters, these tools help you to learn from the past and plan for the future – if you ate too many calories this week, you know exactly how many to remove from your diet next week. However, much of the allure of personal informatics lies in the visualisations these sites can produce with the raw data. Sites such as your.flowingdata.com allow users to create custom visualisation pages for what they’re most interested in and encourage you to ‘play’ with the data.

In theory, brands could have an enormous pool of data at their disposal should these tools become mainstream enough to attract sufficient users. While many personal data tracking accounts monitor health and leisure habits, many others track brand usage, product usage and attitudes towards brands. Personal informatics could help brands spot emerging competitors faster and track whims and fads with more agility than conventional methods. However, criticism of social networking sites that have deployed their members’ data for commercial gain mean that brands need to tread carefully: an assumption that you own the data simply because it is publicly available is imprudent.

On the other hand, brands are beginning to wake up to the potential of incorporating personal informatics into their business propositions – most notably Nike, through its joint venture with Apple and a handful of health clubs to produce the Nike + iPod package. It’ll be interesting to see how others follow suit.

The above image comes from Mapmaker, a user of the Mycrocosm personal informatics website, and is reproduced here with thanks.

Andrew Curry writes:

I was invited earlier this month to speak on the future of payments at the Digital Money Forum in London, now in its thirteenth year and as provocative as ever. Of course, it’s a future that’s increasingly bound up with technology. My version is based on the work that’s been done by the historian of economics and technology, Carlota Perez (which I’ve blogged about elsewhere, at length) on long technology cycles.

We’ve seen five long technology surges, each of around 50-60 years, starting with steam, cotton and canals in 1771. The first half of the cycle, the installation phase, is driven by investment and finance capital. The second half, the deployment phase, is driven by production capital. And in between the two is a financial crash, when investment expectations get ahead of themselves.

In the current information and communications technology surge, we’re a few years into the deployment phase, when people start to do “new things in new ways” with technology. The smart phone and the tablet computer are archetypal deployment products, and digital payments will inevitably get caught up in the rush, as new applications emerge.

One of the likely effects is the fragmentation of devices, rather than convergence (we may use a digitally enabled key to get into our house, or a card or fob s a store of value, but we’re unlikely to leave them lying on a table during a meeting). We should expect fragmentation of currencies as well; local currencies such as the Lewes pound work much better when they don’t have to be printed.  There are already viable currencies within every online multi-player game (and one of the things I learnt at the Forum was that Chinese workers employed to dig virtual gold in online games earn more than Chinese gold miners who dig the physical commodity, and in much better conditions). One of the other speakers talked about the emergence of currencies backed by units of energy consumption. This isn’t hypothetical.

This potentially represents that same sort of democratisation of production that we’ve seen in other sectors, ending the monopoly of the banks (mostly the commercial banks) on credit creation. This thought seemed to cause some nervousness in the audience at the Digital Money Forum, and the questions turned quite quickly to fraud and regulation, although potential fraudsters in an energy-backed currency would be doing very well to steal a fraction of the money that Bernie Madoff took from his investors.

What’s standing in the way? The banks, who aren’t trusted, and the mobile operators, who aren’t particularly interested in payments, at least not in the rich world. It seems likely that the market will need its own ‘iTunes’ moment, when an outsider steps in to create a decisive disruptive change.

The image above is courtesy of Flickr user Bohman, and is used under a Creative Commons licence with thanks.

Alex Oliver writes:

I was lucky enough to present some of our current insight about trust and decision-making, especially at a local level, to a group of local government leaders earlier this month.  In short, it suggests that there’s a growing public appetite for more engagement and involvement, as well as greater confidence in decision making at the local level, compared to central government.

But there are also still significant barriers to engagement faced by certain groups, including younger people. These include knowing how to get involved, which often is not obvious. (Other work we’ve done for government about this also identified that if people did get involved, they needed to believe that their actions would make a difference and their opinions would be listened to; councils still forget to tell people about the impact their involvement has had on the outcomes.)

I also looked at the area of digital service delivery. Work done by the IIPS – the Institute for Insight into Public Services, the think tank we jointly run with TNS-BMRB – shows that concerns still exist around the potential inequalities inherent in internet service delivery for older and less affluent groups, along with the need to consider the role of other digital channels including i-TV and mobile.  People continue to prefer personal channels (phone and face to face) where personal information is concerned, and still expect to be offered choice. The mail is still preferred by a significant proportion of the population (around a third) for forms and payments. People who use services continue to expect multi-channel delivery, rather than being funnelled into one channel. And from a service provider’s perspective, getting the mix of user and channel right can represent a big cost saving.

And the research findings on choice and quality of service continue to be worth emphasising; all social groups, and ages, put quality above choice. And those who value choice more – typically in poorer social groups who don’t have as much choice generally – are also most worried about their ability to make the right choices.

Andrew Curry writes:

It’s become a cult on the web since Tiger Woods crashed his car in mysterious circumstances last weekend, but this CGI-enhanced report from Taiwanese television of the possible chains of events, embedded above, is certainly worth watching.

Leaving aside some of the aesthetic issues (such as Tiger’s South Asian appearance, doubtless hung off an existing CGI wireframe) this does raise some interesting questions. The first is whether such reconstructions are more or less plausible than the traditional ‘news’ alternative of filming a reconstruction. Probably less so: we can see that this is a CGI reconstruction, so it’s been made up. But this will become less true as the technology improves.

Second, is whether it will become more common – to which the answer must be yes. News producers need pictures – when I was trained as a TV news journalist I was told always to check the pictures before I started writing the story – and news reporters inevitably have to describe things which weren’t seen and where events are still contested. Making up your own pictures seems too good to be true, but it’s no more ethically challenging than having a reporter describe what might have happened.

The most interesting question is about ownership. The BBC used CGI reconstruction of the goals in the European Nations Cup in 2008 on its website because it didn’t have the rights to show video there. But who owns the digital reconstruction of an event? On the face of it, no-one. But begging to differ, here come rights lawyers and privacy advocates in their gowns and wigs. Another digital battleground is opening up in front of us.

Yannis Kavounis, the head of our Millenials Knowledge Venturing team, talks to Tom Ding

Tom: Yannis, I have been meaning to ask you about Millenials and the recession…

Yannis: Recession, anxiety, layoffs… I’m personally exhausted from all the speculation and debate around it. Let’s talk about something more uplifiting: change and our future.

Tom: Sure. But where will the change come from?

Yannis: Well, not from government and politicians. They are only trying to resolve the problem using the same tools and context that caused it. So what’s left? Us – ordinary people, and Millennials of course. Millennials are connected and aware of the power of the collective. They have the technological and creative tools to take risks. And most importantly they’re young, not jaded and realise that grassroots overhaul of our economy and values is the only way forward.

Tom: I have seen a few diffferent versions of Millennials and Generation Y, what is your definition?

Yannis: At The Futures Company we say Millennials are the cohort of people born between 1979 and 1992, or roughly those aged between 16 and 29 at the moment.

Tom: OK. So give me some examples of these new values you talk about…

Yannis: So, for instance, I love how some of us are still rooting for ownership (intellectual or physical) as a fundamental principle of our economy. Well, guess what, Millennials are teaching us that modern business models can be based on more fluid and open concepts such as access and open source. Think of a world where you don’t ‘own’ but you ‘share’ – as and when you need to. Who needs iTunes when you have Spotify?

Tom: Yes and everyone I know has started using Spotify all of a sudden. I read that they just got their millionth subscriber in the UK, around the same time that the billionth application was downloaded for the iPhone – which I guess is open development, if not true open source. But is all this generational change about technology?

Yannis: Well, hasn’t generational change always been about technology, through every stage of human evolution? The interesting thing about current technology is how Millennials are using it and the role it plays in their lives. For them, it’s the means to an end, not the end itself – it is the greatest facilitator of societal change at the moment. I see Millennials as the generation that will use technology to help us enter a new age of realisation … be that in the economy, consumerism, or through our social values.

The picture is borrowed, with thanks, from wearesuperfamous.com

(edit: The Futures Company definition of Millenials is those born from 1979 to 1992, not 1982 to 1992 as originally written – a typo, apologies)

Oliver Wright writes:

Since my last post on the role Twitter is playing in relation to more traditional media, a couple of events have highlighted how Twitter, and social media in general, is having a greater influence on significant news events.

When riots recently broke out in Moldova’s capital, Chisinau, thousands of young Moldovans protested against elections whose outcome ensured the communist government would stay in power. The events were quick to grab the headlines, with Twitter once again thrust into the limelight as an example of microblogging’s ability to mobilise people.

It was quickly dubbed “Moldova’s Twitter Revolution”, at least by journalists, but after a week of protests (judges subsequently ordered a recount) a more nuanced story has emerged. Those involved in organising the protests explained they used many online tools to organise the protest; planning involved blogs and LiveJournal accounts, followed closer to the actual event by facebook groups and text messaging. Twitter was, among other things, a clever way of ensuring their message gained space in influential media outlets. By this measure the protests have been a resounding success. (For some more in-depth analysis, take a look here and here.)

Closer to home, the political scandal that has dominated media discourse has been ‘smeargate’ (or #smeargate in Twitter), the saga in which Gordon Brown’s political and press adviser, Damian McBride, resigned after leaked emails described plans to publish gossip stories about senior opposition party politicians on a ‘political gossip’ blog, Red Rag. These were, it was said, primarily to be a response to claimed slurs about members of the Labour party on the Conservative-leaning Guido Fawkes’ blog – a Westminster rumour mill.

Whatever one’s political affiliations, the incident highlights the importance placed within government on the influence of the blogosphere. As a result (unintended), the public is now more aware of political mudslinging previously shared between small groups of politically motivated bloggers. In Moldova, a couple of shrewd planners used their knowledge of how the media operates to take advantage of social networks, particularly the viral nature and gravitas of Twitter, in order to garner the maximum media exposure for their cause.

As we’ve noted earlier, taken individually, services like Twitter, and previously facebook, can seem like isolated fads, but seen within the context of an increasingly savvy and networked online community, they take on greater significance.

The picture at the top of the post was borrowed, with thanks, from the Political Graffiti blog.

Compiled by Tom Ding

The first of an occasional column: Passed around the office lately were:

• A brilliant presentation on the “past and future” of city magic by Matt Jones of Doppir
• A map of the internet (or at least the 333 most important bits) modelled on the map of the Tokyo metro – not the first time, by the way, that we’ve blogged about maps based on tube networks.
• Another less subterranean map of parliamentary expenses (thanks, Digital Urban) – MapTube, the mapping mash-up site which published this also has a map showing all of the London tube stations in their geographically correct positions.
• A complete visual history of Lego’s ‘mini-figures’ from which the picture at the top of the post is taken. And news of a rather larger Lego figure, a sculpture of Jesus made from 30,000 bricks, unveiled at a church in Sweden just in time for Easter.

Enjoy!

Giles Powdrill writes:

“A powerful global conversation has begun. Through the Internet, people are discovering and inventing new ways to share relevant knowledge with blinding speed. As a direct result, markets are getting smarter-and getting smarter faster than most companies.” So said the Cluetrain Manifesto almost exactly a decade ago. The prescience of the work lay in the authors’ clear understanding of the connective potential of the web and the shift in power from companies to individuals which would accompany its growth.

However, despite witnessing this shift in power, the majority of organisations still haven’t adapted their business practices to embrace the internet. They are not making use of the networks, the empowerment or the easy conversation and collaboration made possible through the social media technologies broadly described as ‘Web 2.0′ to help create new types of relationships with their customers. For many, the internet is still just another channel.

But maybe this is beginning to change: perhaps the current recession, the first of the truly digital age, will be looked back upon as being the spur to growth of new types of online commerce. We are already witnessing the growing success of online shopping, price comparison websites and digital advertising in the downturn, but these are only first steps – doing old things in a new way. The real challenge is about greater engagement; working with and for consumers in an open way. It is about companies demonstrating that they know enough about customers and their behaviours to deliver a benefit. Combining transparency with networked data and new technological infrastructure can create situations where all gain, customers and companies alike, but if companies don’t work out how to use these new networks, they may find themselves bypassed as people decide to do it for themselves instead.

A good example of a company getting it right is Zopa, the social lending site set up by banking professionals on which people lend directly to borrowers online. Borrowers bid for funds, and lenders choose whether to respond. Lenders get good returns, and borrowers get lower cost loans. Zopa makes its margin by charging both parties a fee. Default rates are low and lenders can see their borrowers and follow the progress of the their loan. Zopa has disintermediated the banking business by adding social networking and a human touch. In terms of Recession 2.0 it’s a sign of the times. As the Cluetrain Manifesto said: markets are conversations.

The picture, ‘the garden of Zopa’, is from a digital campaign by the social lending site to demonstrate the benefits of personal involvement and mutual help.