The Globe’s bimonthly report on research from business schools.
With Facebook the latest company under fire for mishandling data connected to millions of its users, concern about privacy and security online has heightened.
Recent research by University of Calgary’s Haskayne School of Business colleagues Raymond Patterson and Hooman Hidaji isn’t likely to make anyone feel more comfortable about the collection and disclosure of personal information on the internet.
The latest work from the researchers examines growing privacy concerns associated with funding models that encourage data sharing between website publishers such as The New York Times and Financial Times and various third parties (other commercial and data gathering websites). In their paper, published in the MIS Quarterly journal, the researchers note the use of third parties is “pervasive” among top publisher websites selling access to their sites.
A study cited in the paper notes publisher websites utilize an average of 13.5 (and up to 70 in some cases) third parties. A visit to one popular U.S. tabloid triggered a user interaction with some 352 other web servers, according to a 2014 U.S. Senate subcommittee study of the issue.
Many of those interactions were benign; however, some of those third parties may have been using cookies or other technology to compile data on consumers without their explicit consent, according to the study. Data mined by the practice can include users’ interests, browsing history, location, and past-purchase history.
So widespread is the practice, “most people don’t realize just how much information about them and their online activity has been compiled,” Dr. Patterson, professor of business technology management, says in an e-mail.
Not all website publishers are the same. The researchers found a strong correlation between user desire for privacy and the number of third-party partnerships.
Mainstream news sites, for instance, are more likely to share data with third parties because there is little concern by users over what news or stories they are reading or sharing, says Dr. Patterson.
As a caution to parents, the researchers note that publisher sites dedicated to children and teenagers are also typically rife with third-party providers.
Sites that cater to more sensitive personal topics, such as health care, banking or even pornography, tend to be more respectful of privacy concerns and, therefore, partner with far fewer third parties. It’s not a measure taken out of kindness, the researchers say. Rather, it’s a natural market mechanism that plays off users’ fears that their online behaviour will become public and publishers’ desires to keep their customers coming back.
And even when data sharing is limited, user privacy is at risk. That’s because the third-party industry concentration is higher allowing companies to keep a better record of user activities across all websites.
“Thus, even when you think that a website is giving you more privacy, the market forces may be creating conditions where your privacy is reduced,” says Dr. Patterson.
So why does all this data-sharing matter?
The upside to all this behind-the-scenes information gathering is that it can make our lives easier by providing advertising, video and content suggestions tailored to our individual needs and interests, says Dr. Patterson.
But there is also a serious concern that when advertisers know you better than you know yourself, you are at a disadvantage.
“All of this collection of big data by third parties is coupled with analytics and artificial intelligence [AI] to make decisions concerning you,” he says.
Businesses can help prevent abusive data-sharing by acknowledging their customers’ need for privacy and security online, and limiting third-party partnerships to providers that accept ad-blocking services, says Dr. Patterson.
For users, the choice is more clear cut: Get an ad blocker and be vigilant.
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