Home Finance Data wars: Why technology advocates believe privacy regulations need serious reform

Data wars: Why technology advocates believe privacy regulations need serious reform

As chief executive of Tehama Inc., an Ottawa-based tech company that provides software tools to facilitate remote work, Paul Vallee knows quite a bit about data and technology, but even he doesn’t know where all his data goes these days.

In theory, every Canadian is supposed to give consent to any collection of their personal information, but in practice, he said, people just click “I agree” without knowing what they’re signing up for.

“We need to make consent real. I don’t even get a receipt for my consent,” Vallee said. “You know, normally when I sign a contract, I receive a copy of my contract in the mail, and I can at least inventory all my contracts. This is the Wild West. It’s ridiculous.”

Technology advocates and political leaders say a detailed report last week by the Financial Post on how Tim Hortons’ mobile ordering app tracks users and figures out where they live, work and visit competitors shows how commonplace such activity is, but also highlights the need for serious policy reform on how we regulate data and privacy issues.

The Tim Hortons app is just one of many that may have confusing privacy policy statements. For example, mall owner Cadillac Fairview Corp. Ltd. earlier this week released a new app that asks users for permission to access the phone’s GPS device: “Your location lets us deliver you custom content special to your location,” the app states.

Language in the app’s privacy policy appears to give the company latitude to do the same kind of broad-based tracking that Tim Hortons does in the name of providing targeted promotional offers.

“We may also retain information about the frequency and duration of your visits to particular shopping centres and use this information to provide you with location-based offers and promotions,” the Cadillac-Fairview app states in the location section of its privacy policy.

This is the Wild West. It’s ridiculous

Paul Vallee

Such language could potentially give Cadillac-Fairview latitude to track customers’ visits to competing retailers, but a company executive said the company only meant to say the app may track users inside its shopping malls.

“The app does not log user location data away from CF shopping centres; as such, the policy is referring to particular CF shopping centres,” Jose Ribau, executive vice-president, Digital & Innovation, said in an email. “We recognize the opportunity to be more clear about this and will address this in the next iteration of our privacy policy.”

Ribau said customers cannot create an account through the app, so none of the data is identifiable to particular individuals.

The Cadillac-Fairview’s app is just another one whose privacy policies are written with broad language that gives companies enormous latitude to collect user information in the name of targeted marketing and product improvements.

The Tim Hortons app is just one of many that may have confusing privacy policy statements.

The Tim Hortons app is just one of many that may have confusing privacy policy statements.

Photo Illustration by Gigi Suhanic/National Post

Without seeking clarification from the company on how location information is collected and processed, individual users often have no way of knowing what a company is doing behind the scenes.

Technology advocates say the broader issue of data collection and privacy is something governments urgently need to regulate.

Jim Balsillie, former co-CEO of the company now known as BlackBerry Ltd., has been calling for a national data strategy that would set limits on how companies can use data, but also offer a clear framework for how Canadian business can thrive in the data economy.

“You have to have a strategy for this to say, how do we get the good and not the bad? And we’ve done this a lot with worker rights and social welfare and environmental stuff,” he said. “Like, we want a production economy, but we don’t want people pouring mercury in the water table.”

Jim Balsillie.

Jim Balsillie.

Tyler Anderson/National Post files

Balsillie said people should be thinking about individualized, targeted advertising as more than a benign innovation, because it really amounts to behaviour modification.

“It’s an economic opportunity, but it’s also an enormous threat,” he said. “We lose free markets and we lose democracy in this new mutant form of capitalism, and it’s permeating everybody’s business model.”

One constant among nearly everyone who spoke to the Financial Post for this story is the sense that data privacy rules need to change.

Conservative MP Michelle Rempel Garner, who serves as the party’s critic on innovation, science and industry issues, has been calling for individuals to have more control and ownership over their data. But she said that can only happen if the government puts policies in place to force companies to be more transparent about what data is being collected and why.

We lose free markets and we lose democracy in this new mutant form of capitalism, and it’s permeating everybody’s business model

Jim Balsillie

“From my perspective, the policy intervention should be more control toward the consumer,” Garner said. “If one coffee shop is using your data in the background and another one isn’t, you might use that as a determining choice on which store to frequent, but the point is that you can’t make that choice if the information isn’t transparent.”

More than a year ago, the federal government released a “Digital Charter” that laid out a series of principles meant to guide future privacy law reforms. At the time, the government acknowledged that people have a hard time trusting technology because they don’t know how their data is being used.

“What is clear is that Canadians want more transparency in how their data is being collected and how it is being used,” the Digital Charter said. “Current consent-based models with complex and lengthy privacy policies are inadequate and do not help to build trust.”

The government has yet to reform privacy and data protection laws based on the principles outlined in that document, but Innovation, Science and Industry Minister Navdeep Bains said it might bring legislation forward in the fall.

Bains said that without clear rules and stronger enforcement mechanisms, citizens are liable to lose trust in the digital services that companies provide, and that will have a corrosive effect on the economy.

Innovation, Science and Industry Minister Navdeep Bains.

Innovation, Science and Industry Minister Navdeep Bains.

Blair Gable/Reuters files

“It’s important not only for consumers, but companies need to recognize that if they break this trust, this hurts their brand, this hurts their ability to move forward,” he said. “It’s important to protect Canadians, but I think it’s important for companies to understand as well that they cannot continue to operate like this, because it fundamentally erodes the most important aspect of any relationship which is founded on trust.”

Technation, the country’s main technology industry lobby group, acknowledges that reforming Canada’s privacy laws would be a good thing. Nevin French, vice-president of public policy at Technation, said technology companies want rules that are broadly in line with other countries, and ones with enough flexibility to change over time in order to keep up with the pace of innovation.

“We want to work with government, but we don’t want to be surprised. Knowing what’s coming allows the industry to get ready for that,” he said.

Vallee has a more radical idea. He warns that he gets passionate when he talks about data and privacy issues. But he doesn’t use the normal cliches — data is not a gold rush, nor is it the new oil — instead, he said data should be regulated like music.

Putting a value on the collection and use of data, even a small cost, forces businesses to ask if it’s really worth it

“What I’m calling for is for data being a personal property right much in the way a song that you wrote is yours to monetize, and others can use it but not without paying you,” he said. “It doesn’t need to be a large cost for this to have economic advantage. Suddenly you might be getting 25 to 50 bucks a months in your pocket from these licensing fees, but the other advantage is that you would also be able to have an inventory of who is monetizing data about you.”

One of the problems with the big data economy at its core is that information is so cheap to harvest, everyone does it even if they don’t know how to use it.

Putting a value on the collection and use of data, even a small cost, forces businesses to ask if it’s really worth it.

“We had big data a long time ago, we just had expensive big data. What’s happening with the march of time is that the cost of storing and accumulating and analyzing that data has been declining every year,” Vallee said. “I should be willing to pay the equivalent of a performance fee for the data about you.”

Financial Post

• Email: [email protected] | Twitter: jamespmcleod

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