ePrivacy & Data Protection
Who Watches the Watchers – How Regulation Could Alter the Path of Innovation
If The Graduate were to be re-released today it is almost certain that the career advice from Mr. McGuire to the film’s main protagonist – recently graduated Benjamin Braddock – would be different. Indeed, we would go one step further and argue that it is almost certain that the one word offered by the 2017 version of Mr. McGuire would be ‘data’.
An MIT Sloan Management Review report in 2015 bears this out. Forty-three percent of surveyed companies indicated that a lack of appropriate analytical skills is a key challenge.
And why is this? It is of course because the opportunity from big data, data analytics, machine learning, artificial intelligence, and the Internet of Things is perceived to be enormous and data scientists are the potential key to unlocking it.
But for data scientists to exist, we must have data. Indeed all of these opportunities rely on continued untrammeled access to significant underlying data sets — an assumption that we think investors can no longer fully take for granted.
In this report we look at how consumers are tracked, and how the data that is collected and analyzed is then used by organizations. We then look at how consumers themselves perceive the topic of privacy and why regulators increasingly feel the need to intervene. Finally we conduct a series of case studies with third-party contributors such as Vodafone, Aviva, and even Citi to assess the challenges associated with adapting to the new landscape.
The conclusions are quite stark. Focus on privacy and data protection is on the rise and forthcoming changes to regulation in the European Union (EU), to be implemented in 2018, will fundamentally alter the risk/reward of using data and with it, alter the perception of the long-term opportunity from data.
It’s important to say that this does not necessarily unwind the longer-term upside from big data, data analytics, artificial intelligence, and machine learning. But we do think the path will be muddied by new regulation and that from a corporate perspective, this will require a systemic change of approach with respect to ePrivacy and data protection. And this is not, for the moment, properly understood or appreciated by many corporates or investors.