Data and Trust

While still living and working in Europe, I joined Facebook (aka Meta) when my children who lived and worked in other countries, asked to befriend me online. They are now settled into another stage of their lives and no longer are on this platform.  I deplatformed when researching and learning of the improper use of personal data of  the tech player.  Stateside, I maintained European cell phone services for many years. I was often struck by the difference in media and information provided to me with online sources when contrasting with others in conversations on international business matters. I was new to the then nascent algorithms and machine learning that contributed to today’s generative AI platforms. My own foray into blogging with a website launched in Europe in 2013 and operating until 2020 was often targeted by bots.  In 2018, my website was aligned with a privacy policy that included General Data Privacy Regulation (GDPR) by which consumers had the right to opt into receiving information from my website.  My personal experience has contributed to the work at Next Act Advisors. The Growth Strategies of my clients are always informed by current regulations and the understanding of why things have evolved to where they are because of the regulations and how they might change in the future. I enjoy ‘splaining how things are done, why they are that way and how your business model might be impacted or change the regulations. The month of June I will be sharing with original content from my work with Enterprise SaaS companies addressing a very large market; with many actors and moving parts including AI, privacy and overall regulations in a race to make better informed decisions with accurate, timely and trustworthy sources. The theme of the month of June at Next Act Advisors is “Data, Data Everywhere.”

Now that all our data – private and enterprise, is out there, how can enterprises uphold trust? Compliance and Privacy  The history that drives the regulations of personal data usage has its origin in World War II and the improper use of personal data.  Many business models, regulations and the financial markets operating today were formed because of “trying to keep the peace” after wars. While WWII was still raging in 1939-1945, the Bretton Woods system was negotiated.  In 1944 for 21 days, 730 delegates from all 44 Allied nations gathered in Bretton Woods, New Hampshire, United States, for the United Nations Monetary and Financial Conference. There they fully negotiated a monetary order intended to govern monetary relations among independent states. In the Time article, published on the eve of May 24, 2018 before enactment of the G.D.P.R. Anu Bradford, professor of law and director of the European Legal Studies Center at Columbia Law School shared: “There is this misperception that it’s a protectionist response, but the roots are much deeper. We trace them back to World War II and the atrocities of the Nazis, who systematically abused private data to identify Jews and other minority groups”. The law enacted in 2018 requires companies to ask consumers whether they can collect their data, answer promptly if asked what it’ll be used for and disclose significant data breaches within 72 hours. The failure to comply could result in fines of up to €20 million (more than $23 million) or 4% of the company’s worldwide annual revenue. Meta recently was fined as announced by Ireland’s Data Protection commissioner for a record 2 billion euros ($1.3 billion) and ordered to stop transferring data collected from Facebook users in Europe to the United States. About 10 percent of Meta’s worldwide ad revenue came from ads delivered to Facebook users in E.U. countries. In 2022, Meta had revenue of nearly $117 billion. There will certainly be an appeal.  California introduced the California Consumer Protection Act CCPA in 2020 followed by California Consumer Rights Act in 2023 – two different regulations that regulate data privacy and consumer protection.

Enforcement of the regulations requires an agency. California’s Privacy Protection agency tapped Ashkan Soltani, a former top technologist at the Federal Trade Commission, to lead it in 2022.  Stay tuned. California and other states are filling a vacuum left by Congress. Lawmakers from both parties have long said they would support a national privacy law. GDPR is a cornerstone since 2018 in Europe to consumer privacy and regulation. Europe is likely to continue to lead in setting precedents in privacy and security. Free speech and Section 230  Not unlike the origin story of WII and Bretton Woods system, that created the monetary systems we know today, the 1996 Communications Decency Act was born out of necessity to protect bookstore owners from selling books that in the 1950’s were considered “indecent,” and were not protected by the 1st Amendment of the United States Constitution –  protecting freedom of speech, the press, assembly, and the right to petition the Government for a redress of grievances. Section 230 of the 1996 Communications Decency Act,  states that “no provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” Thereby exempting them from suit. As recent as May 18 2023, the United States Supreme court heard arguments in two cases about content moderation by online platforms such as social media networks.

Gonzalez v. Google and twitter v. Taamneh, with relevance for the application of Section 230 1(Slip Opinion) Cite as: 598 U. S. ____ (2023) Per Curiam NOTICE: This opinion is subject to formal revision before publication in the United States Reports. Readers are requested to notify the Reporter of Decisions, Supreme Court of the United States, Washington, D. C. 20543, pio@supremecourt.gov, of any typographical or other formal errors. SUPREME COURT OF THE UNITED STATES No. 21–1333 REYNALDO GONZALEZ, ET AL., PETITIONERS v. GOOGLE LLC ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT [May 18, 2023] Section 230 still stands.

A recent article from the Chicago Booth Review of Summer 2023 polling US Economic Experts Panels on three statements: ”How would increasing the Liability of Online Platforms change the Internet?”

Statement A: Imposing stronger legal liability on online platforms for content posted by users would substantially reduce the amount of user -generated content available on those platforms. Agree 59% Uncertain 29%

Statement B: Imposing stronger legal liability on online platforms for content posted by users would substantially damage those platforms’ advertising businesses. Agree 31% Uncertain 60%

Statement C: Imposing stronger legal liability on online platforms for content posted by users would substantially reduce the amount of misinformation and disinformation present on those platforms.  Agree 77% Uncertain 13%

Pre online platform Era:  lessons from E.B. White on relationships with press and companies E.B. White in 1974 learned of an arrangement between a retired associate editor of the New York Times accepting a fee from Xerox Corporation to write an article for Esquire magazine accompanied by a Xerox ad.He took pen in hand and wrote a letter to the editor of The Ellsworth (Maine) American describing the arrangement and sharing his disapproval of the same.Xerox responded with their reasons for seeking this arrangement and asked, “do you still see something sinister in the sponsoring?” His response was a long letter finalizing with: …. It would be hard to resist the suspicion that Esquire feels indebted to Xerox, that Mr. Salisbury feeds indebted to both, and that the ownership or sovereignty of Esquire has been nibbled all around the edges.I hope I have clarified by a little bit my feelings about the autonomy of the press and the dangers of sponsorship of articles. Thanks for giving me the chance to speak my piece. “Whenever money changes hands- something goes along with it – an intangible something that varies with the circumstances. “ New York Times page 1 June 15, 1976 excerpts from letter E.B. White takes on Xerox and wins Some bonus points for data nerds 

“Book of Numbers”  by Joshua Cohen 2015, I bought while at the airport bookstore in San Francisco  and home to Facebook and many more technology companies that have our data.  I bought this thinking I would enjoy the non fiction read. I was alarmed at first and then I connected the dots of who owns and manipulates the data.

“ Confirmative: Everyone was still thinking about onvertising,(this is correct spelling !) online advertising, as like a phonebook. As like the Diatessaron. Whitepages in the middle, yellowpages all around based on whatever, on whoever, would pay. But then to take the terms a user searched for and respond to them with ads, to respond to them individually and with only the ads that pertinated alongside our free results, which would inadvertently demonstrate the supremacy of our free results, that was total Moe. (A character in the book) Wasted nothing. Perpetual motion. Reversible. Leave it to Moe, a captain machine, general mechanics, to deliver such sagacity from just a billboard.  (Adverks -this was what lured Carbon Capital?) Page 280

If you are a founder, and you would like to learn how your company’s  policies may need to evolve to protect privacy  data in the pursuit of good corporate governance, please  book time with me at Next Act Advisors.  Brenda A. McCabe  #enterprisedata  #datagovernance  #corporategovernance