Who owns consumers’ big data?

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Who owns consumers’ big data?


With more companies around the world using large amounts of consumer information - so-called big data - to better serve their customers and offer personalized conveniences, many consumer rights groups are questioning the ownership of the information collected, with some going as far as arguing that data about citizens of a certain country belongs to their respective government.

Kim Kyung-min, a 35-year-old working mom in Seoul, has discovered just how extensively big data is being used to sell her products and services. Just a few days after she searched online for some shoes for her 6-year-old daughter, an advertisement popped up on her phone suggesting shoes she might be interested in.

That wasn’t too bad, but the real kicker came when she visited a nearby department store and received a message as she entered notifying her of different sales on all the floors. “I can see more and more these days what big data actually is,” Kim said. “[While it’s convenient], on the other hand, it makes me feel uncomfortable as if I am under constant scrutiny.”

Questions about data collection and who owns the information has set up a tug of war between companies and governments around the world. The European Union was one of the first to raise the issue. In a 2014 report, the European Data Protection Supervisor, tasked with ensuring consumers’ right to privacy in Europe, wrote, “Many of [online] services are marketed as ‘free’ but in effect require payment in the form of personal information from customers. An investigation into the costs and benefits of these exchanges for both consumers and businesses is now overdue.”

The United Kingdom’s Competition and Markets Authority, which regulates economic competition, expressed a similar sentiment in 2015, saying firms with market power have the “ability and incentives to exploit further power over the collection of consumer data.”

In Germany, the Federal Cartel Office last year investigated Facebook’s operation there for abusing its “dominant position” and “infringing data protection rules” by limiting service if users do not agree to the “company’s collection and use of their data.”

Companies’ collection of personal data is gaining more scrutiny as consumers and government authorities increasingly realize the value of that information. “Consumers feel ‘tricked’ when they realize that services by search engines and social media platforms, which they deem free, are actually charging them with their data,” said Lee Joon-gil, a senior adviser at Jipyoung, a law firm in Seoul. “It is quite an unfair practice from the consumers’ perspective since they cannot stop using these services even if they do not want to give out their info.”

“The terms and conditions for internet services are … adhesion contracts [drafted and imposed by one party and signed by the other],” said Lee Eun-woo, a lawyer at Jihyang Law. “Most consumers do not read through all the conditions, and they cannot access the service unless they agree to the terms, meaning it’s not truly an agreement.”

The Chinese government took steps this year to protect data collected within its borders, making it a legal obligation to store data originating from China on Chinese servers and requiring companies to obtain permission from the government before transferring data overseas.

Lee Hwang, a professor of law at Korea University, said the recent move by China shows its determination to protect its internet industry and keep big data, a valuable resource, out of the hands of foreign companies.

“While our government cannot imitate such a move, it is a clear indicator that big data ownership has risen as a topic of discussion on the national level,” the professor said.

Korea’s Fair Trade Commission has reportedly begun investigating Google and Facebook for possibly abusing their market dominance, a clear sign that the Korean government is taking issue with any one firm gaining a monopoly on data.

There are concerns, though, that excessive limitations on data collection could hamper the development of big data as an industry. “We need to come up with a balanced agreement among entities regarding the ownership issue,” said Hong Dae-sik, a professor of law at Sogang University.

BY LIM MI-JIN [choi.hyungjo@joongang.co.kr]
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