In fact, the direct-marketing practice of using form-based information (like warranty registration cards) to segment customer lists into demographic, geographic or financial groups is decades old. Because of the limited nature of available consumer information in the past, that was all that was computationally feasible at the time.
Privacy abuses still hinge upon the question of whether the use of personal information is legitimate. But this duality of definition is an inadequate framework for discussing--let alone resolving--issues brought about by new technology.
As consumers replace conventional household appliances with newer, "intelligent" models, the desire for full spectrum interoperability is leaving the realm of the early adopter and going mainstream.
Few people enjoy duplicative data entry, such as manually entering contact information into phones, personal digital assistants and fax machines. Most will welcome, if not demand, interconnected and highly customized appliances and services.
These interconnections create a network effect that will significantly enhance the utility of each independent device. But at the same time, they will throw off huge amounts of data detritus with a long half-life--including log files, communication records and transactional histories. Imagine a lifetime of household garbage poked, prodded and profiled by marketing archaeologists.
This is the future of data profiling; all that's missing is enough data. Lots of people already know how to profile.
Few people have heard of Fair, Isaac, a publicly traded company that describes itself as "the preeminent provider of creative analytics that unlock value for people, businesses and industries." Its main moneymaker is a software system called FICO that scores reports from the big credit-reporting bureaus to enable commercial establishments to make quick credit-approval decisions. Even though 80 percent of consumer financial lenders use FICO for granting credit--not the credit report--consumers have no legal rights to see or challenge their FICO score.
Commercial analytic systems could easily benefit from the newer and more personal sources of consumer information that are starting to accumulate in pockets all over the wired world.
Information includes television-viewing data from TiVo, grocery store purchases from Safeway, telephone usage information from Qwest and DVD watching and music listening habits from Microsoft's Media Player. Each database adds more detail to the sketch of a profile of the individual. It's like walking into a stranger's apartment and looking at his or her book and CD collection, and--for the truly nosy--the contents of the medicine cabinet.
So what? Better profiling means more accurate and targeted marketing, which isn't necessarily bad at all. But profiles aren't just used for marketing.
The IRS uses a highly secretive system called the Discriminant Function System (DIF) that scores each individual and some corporate tax returns for the likelihood that an audit will generate additional revenue for the Treasury Department. The IRS has admitted that it also uses third-party information including media mentions, public records and information from database companies.
Scoring systems can do more than determine creditworthiness. What about psychological categorization? It should be feasible to analyze and measure people on various clinical scales such as "intelligence," "impulsivity," "anxiety" and "depression" by either retrospective profiling of activity logs or by creating seemingly useful public Web sites or applications whose hidden purpose is to psychologically test their users.
If this seems farfetched, consider that "behavioral profiling" of criminals is typically conducted with a lot less information than is available in a TiVo log file.
Former FBI profiler John Douglas, the inspiration for "Silence of the Lambs," created a profile of the Unabomber three years before police arrested Ted Kaczynski, a 53-year-old hermit and former Berkeley math professor. Douglas predicted among other things that the killer "would be lonely, white, meticulous, no longer young, living or working in or around San Francisco and a highly intelligent and a voracious reader." The profile turned out to be mostly accurate (Kaczynski was a slob).
So what am I worried about?
If the Internet bubble taught us nothing else, we should know by now that there is no such thing as a free lunch. Just as the desire for a more personalized experience on the Web led to a begrudging tolerance of cookies, the demand for interconnected, easy-to-use appliances and services generates enormous amounts of unwanted descriptive information that is effectively impossible--and certainly counterproductive--to fully regulate.
Data is the waste byproduct of the wired world, and those who are willing to get their hands dirty will use it to discover things about us that will disturb our modern sense of privacy. But should we expect less cognitive dissonance from life in the global village than a hard-core city dweller would experience from life in a small town?