Symposium Forward: The Market for User Data

The full text of this essay may be found here.

Abstract

Two decades ago, scholars and writers wondered whether online tech companies would ever find a sustainable business model. It appears, however, that, even at that time, some savvy entrepreneurs were on to something. DoubleClick, which is now owned by Alphabet, for example, had already developed techniques to track users’ web browsing activity across their hundreds of affiliated sites. There, of course, was nothing novel in the idea of an advertising-based business model; advertising has defined the political economy of the media and communications industry at least since the nineteenth century. But, at the turn of the century, it was not evident to anyone but just a relatively few scholars and entrepreneurs in the start-up world that targeted behavioral advertising would have purchase in the networked information economy.

Today, companies have been refining the advertising-based business model. They have been developing ever more powerful algorithmic processes for harvesting, trading on, and exploiting personal consumer data for advertisers. These computational techniques have empowered firms to collect extraordinary amounts of consumer data, anticipate consumer preferences based on that data, and microtarget advertising to individual users based on those predictions. It is all a marketer’s dream. And, if click-through rates are to be believed, consumers are sold.