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WHAT THE HELL IS A DATA BROKER?
Freely divulging information
about yourself on Facebook, Foursquare, Twitter and other websites causes your personal data to feed directly into the lucrative
business models of information brokers and data scrapers, as a new video from identity management firm Reputation.com vividly
Clear Cloud Live asked Michael Farr, founder and CEO of One-Reputation.com, to elaborate on the drivers
behind this rapidly emerging piece of our digital economy.
CC: Why did Reputation.com decide to do the video?
FARR: The current architecture
of the Web has created a privacy horror show for individuals. Every day we input vast amounts of information online —
whether it's personal information such as a Social Security number, home address, household income range, age range, political
leaning, gender and age of children, financial and health records — or seemingly innocuous website visits, connections
to friends, searches, tweets, comments, posts, or "likes" of restaurants and hobbies.
This information is being collected, compromised and
commoditized without our consent. The purpose of this video is to increase awareness of what's going on behind the scenes
and help people understand that when they're supposedly getting a free lunch on the Web, they are actually the product being
What is the main point your video is intended to convey?
FARR: Marketers, data brokers and online advertisers are in a race to the privacy bottom. The more
personal data points they absorb online, the higher their CPMs, the higher their revenue. We can't rely on the self-policing
mechanisms of these industries to protect consumers; it goes against their business goals.
Internet users often have little recourse if personally
identifiable data is made available and scraped online. There is currently no national law requiring data companies to let
people easily control, remove, or change personal information about themselves. We are working to educate individuals on how
their information is used online in order to stimulate change.
CC: Who are the information brokers referred to in your
FARR: Privacy Rights Clearinghouse
has compiled this list of
the data brokers and data scrapers,
CC: Who are the companies buying this data?
FARR: The emerging business of Web scraping
provides some of the raw material for a rapidly expanding data economy. That's according to The Wall Street Journal's What They Know series. Marketers spent $4.7 BILLION on online and offline data in 2009, according to the New York management consulting firm Winterberry Group.
Spending on data from online sources is set to more than double, to $840 million in 2012 from $410 million in 2009.
Have insurance companies, in fact, been also buying this type of profile data?
FARR: The Journal said that it is happening in a story about how insurers test data profiles to identify
risky clients, and The New York Times has also written about data sharing in the health industry.
Have employers started buying this data?
FARR: One company that screens job applicants for employers,
InfoCheckUSA in Florida, began offering limited social-networking data — some of it scraped — to employers about a year ago.