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Apple's 5G iPhone 12 and iPhone 11 at an Apple Store in Shanghai China, on Oct. 23, 2020.

ALY SONG/Reuters

Any iPhone user who updated their operating system recently discovered a new and truly remarkable privacy feature: the option to shut down any app’s ability to track you across your other apps. It’s a full-screen popup that essentially asks you whether you want to let Facebook or Twitter or any other app continue to gather data about you from your iPhone.

The feature has provoked a minor existential crisis among many tech firms, including Facebook, that make their money by gathering information about you. How will they know which sports gear ads to put in your feed if they can’t check your fitness apps to see if you are running, cycling, or playing tennis these days?

The stakes are far higher than a few pairs of running shoes. The market for our personal data has risen out of thin air in the past 20 years to become a trillion-dollar global economy, and this kind of surreptitious data tracking is routine in the industry. One analyst estimates that, if 80 per cent of iPhone users say no to tracking, it could cost Facebook as much as $2-billion in quarterly revenues.

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But if Apple is effectively shutting down some data revenue streams, it is also opening up new ones – and not merely for Apple itself. Once people have more control over their personal data, it will begin to shape a world in which they get something in return for sharing it, rather than always giving it away for free.

The average smartphone has 80 apps, which means the average smartphone user has signed 80 different agreements to surrender their data. It’s a testament to the dysfunction in our current data ecosystem: Hundreds of companies compete for access to our personal data, yet we never have any bargaining power in the deal.

Apple’s solution changes that dynamic, by allowing its customers to turn their iPhones into a kind of data lockbox. It’s an important first step in changing the worst practices of the data industry, which have given rise to the phrase “surveillance capitalism.” That said, it has its own flaws.

If we have learned anything from big tech by now, it’s that the personal data inside our smartphones is a treasure trove worth billions of dollars. What we need is neither a lockbox nor a free-for-all. We just need better ways to share data, so that we all reap the rewards: profits for the companies we share it with, better online services for users, and affordable internet access for everyone.

Once our data is held privately on our phones, we can put it to better use for us with private algorithms. If, for instance, you want to reduce your electricity consumption or your internet data usage, it’s easy to imagine an app that allows you to drag and drop your banking, home internet , electricity and home-automation apps into a single workflow on your phone, giving them permission to share your data with each other and come up with solutions that fit your budget.

But what if you want to compare your situation to similar households, to be sure you’re still not spending too much? For that, you’d give those apps permission to share your anonymized data more broadly, so that you could get some comparative data in return from similar neighbourhoods. In all likelihood, your internet provider would be eager to get their hands on your shareable data because of how highly valuable it can be. So they’d pay you for it, in the form of a discount on your bill. And the more data you agree to share (the viewing, browsing and gaming habits of every person in your household), the bigger your discount.

This is exactly how a better data ecosystem would work if people truly owned their data. The online world would be private by default, and would not cost you a dollar more than it already does. With the levers of data ownership in your hands, you would decide who you share your data with and how much to share, in exchange for a kind of data dividend. Sometimes that dividend is a discount or a rebate; sometimes it’s better, more personalized advice or recommendations.

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And while this may sound like a far-off utopia, Apple’s new privacy feature takes a tangible step toward it. If iPhone users choose to adopt the new privacy feature en masse, they could create a new market for the kinds of helpful, privacy-preserving apps I described above.

They could also create a market for new and more structured ways of sharing data, akin to data investment funds: All investors agree to pool their personal data, and to invest it only in specific groups of companies. Some data funds will have higher risk-reward profiles than others. Some people may choose to invest their data in more than one.

At least we will get to choose where our data goes based on what we’re comfortable with. No one will take it without our permission, but we won’t keep it stuffed in our smartphones either, like dollar bills in a mattress. It’s too valuable for that.

Hossein Rahnama is an associate professor at Ryerson University’s RTA School of Media, a visiting professor at the MIT Media Lab, and the founder and CEO of Toronto-based digital technology company Flybits.

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