If you’re not paying for the service, are you the product?
That’s been Silicon Valley conventional wisdom for at least a decade, but the new focus on data privacy in the wake of Facebook’s Cambridge Analytica scandal has inspired the world to re-examine the maxim. It’s pretty clear now that it’s an oversimplification, and there’s a strong case to be made that thinking this way is downright dangerous.
That doesn’t mean we let services like Facebook off the hook, but we should be cognizant that there are other ways to monetize a free service outside of “profiling” users to optimize advertising.
One good example is Viber. Founded in 2010 as a mobile-first messaging service (then a novel idea), Viber now has about half a billion monthly active users worldwide. And it doesn’t do advertising in the traditional way.
CEO Djamel Agaoua joined Mashable’s MashTalk podcast to talk about the current conversation about user data, whether its users are “products,” and how it squares a strict privacy-first approach with monetization (Viber isn’t profitable, Agaoua admits, though it was bought by Japanese tech giant Rakuten for $900 million in 2014.)
“The Facebook galaxy is our major competitor,” Agaoua said. “Messenger is a very different model from us. It necessitates a lot of ads, a lot of reading of everything exchanged on the platform to be able to monetize as much as possible. WhatsApp was supposed to be different…we’ll see what WhatsApp will become. If WhatsApp remains a secure private app, or if it becomes another tool of the Facebook galaxy to grab more data and make more money.”
While Viber makes some money via user fees (calling out to a phone number costs a nominal fee, as do extras like sticker packs), the way it treats advertising doesn’t depend on user data. Instead, it will only serve ads when a user goes to the Discover part of the app and looks for something. For example, if you search for “restaurants” you may see some local spots that have paid to be there.
The important part is Viber says it doesn’t use personal data to serve any of this content, and it will only serve these kinds of ads when you’re proactively searching for something.
“The answer to a search could be sponsored in some cases,” Agaoua explains. “It’s advertising, but it’s not advertising by pop-ups when you don’t want it.”
On top of that, for messaging, Viber turns on end-to-end encryption by default. That makes it impossible for the company to read any of those messages, and any encrypted messages that travel through the service are deleted from servers as soon as they’re delivered, the company says.
“We don’t read this content, we don’t use this content. We don’t have this data available for anyone — not for us or any advertising partners,” said Agaoua.
Of course, that also means it’s more or less impossible for Viber to offer any kind of “personal assistant” or actively provide help when you are having a conversation, in the way Messenger and Google Allo do. “When you’re discussing with your friends about getting a pizza somewhere, we don’t know, so we’re not going to send you advertising.”
However, Agaoua doesn’t take a hard stance that it’s not OK for a service to make money off user data. In the case of Facebook, however, he believes the company wasn’t transparent enough about the bargain its users were making.
“The model of providing a service for free to monetize via third-party services is not a problem,” Agaoua said. “The problem with Facebook was that the company vacuumed a lot data without the specific, explicit consent of the users, which is very different…. If someone is getting data off your back without telling you exactly what data it’s getting and why and — even worse — with whom it’s sharing this data, then there is an issue.”