Storm Clouds Are Coming

Many high tech services are thrown out to see what sticks, hoping that customers will misjudge the utility and security aspects. Sometimes, the service can slowly boil the customer’s frog into a financial commitment and generate a cash flow. It’s the new game for tech entrepreneurs.

In previous times, before the Internet changed the rules, companies would conceive of products, test them for fitness, merchantibility and safety. Then customers would make a considered decision as to whether the product’s utility compared to the price created a favorable sales proposition.

Today, however, the sophistication of software and the Internet has created many more opportunities for products whose proposition depends on customers thinking in old ways in order to achieve success. The classic example is the free app that reads a product bar code in a store and provides a list of all local merchants and their price. The cost to the customer is nothing, so the apparent utility to cost ratio is huge. The developer gets a kickback from the merchant who sells you the product. Together, they collect information about your buying preferences and, in turn, sell or exploit that information. All this is done behind the scenes in software.

It’s nothing at all like buying a blender at Wal-Mart.

As a result, modern age customers need to be especially tuned into these business models in order to make informed decisions about whether to acquire and use a product. That’s whether it’s an app like the ones I described above, Facebook, or the cloud. To make things worse, license agreements associated with these on-line services provide for just about no liability, for any reason, on behalf of the provider. So, for example, if Facebook goes off the air for a week due to a tornado, the company owes us nothing because they charged us nothing. Compare that to how sensitive we are about, and the laws pertaining to, say, lead in toys that come from China.

When a service is free, it’s valuable information about the customer that is obtained in exchange, and that’s a lesson we’re learning every day. You are the commodity to be traded.

The Dark Cloud

Another modern age technique is to lure customers into cloud services. In the name of convenience, a utility the customer has to evaluate, the cloud allows customers to access their personal data from anywhere. There are several downsides, however. First, the customers have to (or will have to eventually) pay to access their own data. Second, the customer’s personal data is stored on the server of the provider without guarantees of accessibility or security. As Richard Stallman pointed out recently, “The police need to present you with a search warrant to get your data from you; [in your home] but if they are stored in a company’s server, the police can get it without showing you anything. They may not even have to give the company a search warrant.”

The Cloud

The Promise

That should be of concern because in the post-9/11 world, tidbits of information passed on the Internet that are, in fact, innocent are data mined for national security. The more personal data you push out on to the Internet into various services, the greater the chance you’ll trip an alarm that can’t put your data into context. Fourth Amendment issues are cropping up al over now.

The advertised utility of the cloud depends on obscuring risks and emphasizing convenience to the point where people misjudge the trade-off. Also, appeals to technical hubris are an often used tool. For example, it’s considered really cool (and clever) to be able to enter  the next dentist appointment in your iPhone while at the office and have it (almost instantly) sync wirelessly back to your calendar program on your Mac at home. Never mind that there may be no one there to view it. For those people who just have to have this immediate level of  technical self-satisfaction and convenience, my reaction is:

Poor baby.

We lived for a long time without that feature, and to suggest that it’s just too much trouble to sync your iPhone when you get home from the dentist is ludicrous.

There is peace of mind in knowing that your personal information is stored and backed up on your own media. That your syncs are conducted on your own home network, not spilled all over the Internet. That you won’t ever have to pay to access your own data. It requires some conscious thought and cussed independence on this, a certain willingness to disregard the momentum of the crowd.


The Reality

Many Apple customers, who’ve weathered the storm of Apple’s beleaguered days in the 1990s know what it’s like to be the crazy one, the misfit, the rebel, the troublemaker. Are you one of them?

What I call “Crowd Services” like Chrome OS, which makes the Internet your storage medium, some cloud services for personal information, which stores everything about you on a sever that may not even be in the U.S., and some social networks all have the capacity to rob you of your independence, security and personal responsibility. That doesn’t look like a good product choice to me.

[Images courtesy iStockphoto]