Comment by CircuitSeuss

15 days ago

This ignores the aspect of consumer data. Credit issuers generate profit through issuing rewards programs in part due to the sale of their customer’s behavioral spending data. Cash and debit users largely retain their data privacy here.

It’s hard to put a real world number on what the cost to the consumer is for losing this data ownership, but it is not zero: these data are increasingly used for targeted pricing practices which extort additional margins from the consumer at a later date.

24 comments

CircuitSeuss

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rkuodys  15 days ago

Is't the fact that data is valuable for somebody, does not mean that it has a cost (price) for me? Spending data is definitely valuable for seller / corporation to know what to produce. I, on the other hand, cannot get money by saving information.

It's not zero sum game, that either I have it or seller have value out of it. Just like with garbage - for me old broken furniture might be a garbage, while for other it's a burning fuel.

  • ownagefool  15 days ago

    I think the OP is right in that spending data is valuable as a mechanism to figure out how extract more profit, which in the end will have customers paying that price.

    However, it doesn't need to be exclusively negative. The data will both show where you can price gouge but also simply where demand is.

    Put your coffee shop near a metro stop and sell sourdough bread and people will buy that because they want it isn't exactly negative.

  • kevin_thibedeau  15 days ago

    That data is used in some alarmingly manipulative ways that directly affect your life.

    • sfn42  15 days ago

      I personally don't really see the problem. I'm not going to buy something I don't want/need. If they use the data to show me ads for something I want that then leads me to making a purchase, to me that seems like a win/win.

      I'm generally a pretty frugal person, I have a good handle on my personal finances and I don't really buy much stuff at all. Maybe for someone else, shopping can be similar to an addiction where they see an ad and they know they shouldn't buy it but they can't resist. Women with a closet full of shoes come to mind. For those people I can see how this might be problematic but personally I largely ignore ads altogether. If I need a small thing I just go to the nearest store and buy the first best thing I find, if I'm making a more significant purchase I generally do some research and look at tests, user reviews etc. Sure there's some opportunity for manipulating me with fake/biased tests and reviews etc but I'm not really seeing how my spending info helps with that.

      3 replies →

  • Brian_K_White  15 days ago

    The only reason it's valuable is because of it's utility to extract value from you. Not just money either but for instance the power to manipulate.

    It's not a scientific discovery.

    • rkuodys  15 days ago

      But something can be valuable to somebody without hurting you. For example if you participate in study as a member of control group. There is no impact to your life and huge benefit to whoever is producing the research. Similarly waste collection businesses take something that has no value to you and generate profit by modifying your waste into something valuable. That is to say - the fact that somebody gains value does not equate that you are loosing the same value.

      1 reply →

    • hedora  15 days ago

      In the UK, google extracts one average lifetime retirement savings per person in revenue, on average. You could argue that Google’s customers, like advertisers, propaganda firms, etc, all overpay for the data.

      That seems unlikely, since I don’t see how many of them could be profitable if they were paying Google more than their own revenue.

      1 reply →

ragnese  15 days ago

Why wouldn't a bank sell debit data just the same as credit data? For that matter, I would expect them to be selling everything they can: credit, debit, written checks, ACH transfers, etc.

What incentive is there for them to not do that? Laws? I'm asking sincerely, not rhetorically.

  • hedora  15 days ago

    There are laws, even for credit card data. They used to be enforced and largely obeyed.

NooneAtAll3  15 days ago

I think one factor missing in such discussions is that consumer data can be used for political means

And I don't mean "politicians can use it" - but instead, as corporations are more and more involved in the politics, you get targetted and directed based on their needs

  • hedora  15 days ago

    It can also be weaponized. Israel uses these sorts of datasets to systematically murder the families and neighbors of their targets. The operation name is something like “Where’s daddy?” They use commercial datasets to figure out where the kids are, then wait for the parent (generally a civilian) to return home, then level the apartment block when it is most likely their are children and neighbors present.

    Presumably, the same is being done in Ukraine and Russia too.

phyzix5761  15 days ago

Debit card usage is also used for data brokering.

  • CircuitSeuss  15 days ago

    Yes, but typically only on the retailer/ Point of Sales side. Your bank is not selling that information. Of course, things get weird when you have additional intermediaries like Apple or Google pay. In principle at least, there should be some measurable difference vs credit.

    Would be very curious to see studies on this if anyone finds one!

    • rozenmd  15 days ago

      > Your bank is not selling that information

      Oh it very much is, (at least in Australia the major 4 banks have agreements with data brokers)

semiquaver  15 days ago

Do you have evidence to support your claim of targeted pricing practices? In what areas?