For several years, I have noted that online privacy is the 800-pound gorilla in the room whenever discussions are held about Big Data, targeted marketing, or the digital path to purchase. Although the gorilla has already been let out of the cage and isn’t likely to be recaptured, privacy will nonetheless remain a concern in the years ahead. The latest addition to the discussion is a report issued by the President’s Council of Advisors on Science and Technology entitled “Big Data and Privacy: A Technological Perspective.” [Executive Office of the President of the United States, May 2014] David E. Sanger and Steve Lohr report, “The White House, hoping to move the national debate over privacy beyond the National Security Agency’s surveillance activities to the practices of companies like Google and Facebook, released a long-anticipated report on [May 1st] that recommends developing government limits on how private companies make use of the torrent of information they gather from their customers online.” [“Call for Limits on Web Data of Customers,” New York Times, 1 May 2014]

John D. Podesta, a senior White House adviser and chief author of the report, indicated in an interview with Sanger and Lohr that the President, during his review of NSA activities, was surprised to learn that “the same technologies are not only used by the intelligence community, but far more broadly in the public and private spheres because there is so much collection.” According to the White House, the President asked “Podesta to lead a 90-day review of big data and privacy. The review was conceived as fundamentally a scoping exercise, designed to define for the President what is new about the technologies that define the big data landscape; uncover where and how big data affects public policy and the laws and norms governing privacy; to ask how and whether big data creates new challenges for the principles animating the Consumer Privacy Bill of Rights embraced by the Administration in 2012; and to lay out an agenda for how government can maximize the benefits and minimize the risks of big data.” [“FACT SHEET: Big Data and Privacy Working Group Review,” White House, Office of the Press Secretary, 1 May 2014] The report recognizes that Big Data analytics do present “incredible opportunities,” including the ability to save lives, improve the economy, and make government more efficient. The Fact Sheet states:

• “Big data is saving lives. Infections are dangerous — even deadly — for many babies born prematurely. By collecting and analyzing millions of data points from a neonatal intensive care unit, one study was able to identify factors, like slight changes in body temperature and heart rate, that serve as early warning signs an infection may be taking root — subtle changes that even the most experienced doctors may not have noticed on their own.
• Big data is making the economy work better. Jet engines and delivery trucks now come outfitted with sensors that continuously monitor hundreds of data points and send automatic alerts when maintenance is needed. Utility companies are starting to use big data to predict periods of peak electric demand, adjusting the grid to be more efficient and potentially averting brown-outs.
• Big data is saving taxpayer dollars. The Centers for Medicare and Medicaid Services have begun using predictive analytics — a big data technique — to flag likely instances of reimbursement fraud before claims are paid. The Fraud Prevention System helps identify the highest-risk health care providers for waste, fraud, and abuse in real time and has already stopped, prevented, or identified $115 million in fraudulent payments.

Big data also presents powerful opportunities in areas as diverse as medical research, agriculture, energy efficiency, global development, education, environmental monitoring, and modeling climate change impacts, among others.”

On the other hand, the Fact Sheet notes that Big Data analytics have a darker side. It continues:

• “Big data tools can alter the balance of power between government and citizen. Government agencies can reap enormous benefits from using big data to improve service delivery or detect payment fraud. But government uses of big data also have the potential to chill the exercise of free speech or free association. As more data is collected, analyzed, and stored on both public and private systems, we must be vigilant in ensuring that balance is maintained between government and citizens, and revise our laws accordingly.
• Big data tools can reveal intimate personal details. One powerful big data technique involves merging multiple data sets, drawn from disparate sources, to reveal complex patterns. But this practice, sometimes known as ‘data fusion,’ can also lead to the so-called ‘mosaic effect,’ whereby personally identifiable information can be discerned even from ostensibly anonymized data. As big data becomes even more widely used in the private sector to bring a wellspring of innovations and productivity, we must ensure that effective consumer privacy protections are in place to protect individuals.
• Big data tools could lead to discriminatory outcomes. As more decisions about our commercial and personal lives are determined by algorithms and automated processes, we must pay careful attention that big data does not systematically disadvantage certain groups, whether inadvertently or intentionally. We must prevent new modes of discrimination that some uses of big data may enable, particularly with regard to longstanding civil rights protections in housing, employment, and credit.”

Concerning the second point (i.e., the revelation of personal details), Jessica Goldstein reports on how even the most dedicated proponents of online privacy find it difficult to remain anonymous. [“Meet The Woman Who Did Everything In Her Power To Hide Her Pregnancy From Big Data,” Think Progress, 29 April 2014] She writes:

“Janet Vertesi, assistant professor of sociology at Princeton University, had an idea: would it be possible to hide her pregnancy from big data? Thinking about technology — the way we use it and the way it uses us — is her professional life’s work. Pregnant women, she knew, are a marketing gold mine; a pregnant woman’s marketing data is worth 15 times as much as the average person’s. Could Vertesi, a self-declared ‘conscientious objector’ of Google ever since 2012, when they announced to users that they’d be able to read every email and chat, navigate all the human and consumer interactions having a baby would require and keep big data from ever finding out? Here’s what she found: hiding from big data is so inconvenient and expensive that even Vertesi doesn’t recommend it as a lifestyle choice.”

Using data to try and sell products (especially products that consumers want) is not the real concern. The more basic concern is discussed in the third bullet (i.e., discrimination). With all the recent publicity surrounding Los Angeles Clippers owner Donald Sterling’s racist remarks, it’s clear that discrimination remains a serious issue in the United States. Steve Sailor, a privacy advocate, reports how Big Data can be used to skirt laws that make it illegal to discriminate based on race. “You don’t actually need to know that somebody is black,” he writes, “if you know she drinks grape soda, smokes Kools, loves Tyler Perry, etc. All that stuff correlates with being a worse risk (and with being black).” [“White House: Big Data causes big disparate impact,” Steve Sailer: iSteve, 2 May 2014] The White House Fact Sheet goes on to summarize the report’s recommendations for dealing with Big Data-associated privacy issues. It states:

“No matter how quickly technology advances, it remains within our power to ensure that we both encourage innovation and protect our values through law, policy, and the practices we encourage in the public and private sector. To that end, the working group made six actionable policy recommendations in their report to the President:

• Advance the Consumer Privacy Bill of Rights because consumers deserve clear, understandable, reasonable standards for how their personal information is used in the big data era.
• Pass National Data Breach Legislation that provides for a single national data breach standard, along the lines of the Administration’s 2011 Cybersecurity legislative proposal.
• Extend Privacy Protections to non-U.S. Persons because privacy is a worldwide value that should be reflected in how the federal government handles personally identifiable information from non-U.S. citizens.
• Ensure Data Collected on Students in School is used for Educational Purposes to drive better learning outcomes while protecting students against their data being shared or used inappropriately.
• Expand Technical Expertise to Stop Discrimination because the federal government should build the technical expertise to be able to identify practices and outcomes facilitated by big data analytics that have a discriminatory impact on protected classes.
• Amend the Electronic Communications Privacy Act to ensure the standard of protection for online, digital content is consistent with that afforded in the physical world — including by removing archaic distinctions between email left unread or over a certain age.”

Marc Rotenberg, executive director of the Electronic Privacy Information Center, told Sanger and Lohr that “the report identified the key issues and that its policy recommendations addressed privacy groups’ major concerns.” I seriously doubt, however, that most privacy groups will think the recommendations go far enough. The fact that Yahoo recently announced that it was going to ignore “do not track” requests will surely keep the debate alive and kicking. Red Orbit reports, “Nearly two years after becoming the first major tech company to implement Do Not Track (DNT), Yahoo announced this week that it was dropping support for the privacy setting, citing the absence of a single industry-wide standard and a lack of popularity for the feature.” [“Yahoo Pulls Support From Do Not Track Feature,” 3 May 2014] Since so many companies are significant stakeholders in this debate, the private sector needs to work closely with policymakers to devise rules that ensure personal data is used responsibly and ethically. The White House report is not the end of the war but simply one of the first shots across the bow in a long-term engagement.