The emerging risks of privacy abuse in location based services

There was an article on Mashable yesterday about Foursquare beating Twitter to the business market that was sycophantic to a degree I haven't seen in a tech blog before (hmmm...is this a new New Media business model emerging, copying the Old Media and just regurgitating PR guff sans thought?), but fortunately TechCrunch was quick to take issue with it:

There’s some hoopla today that the location-based social network Foursquare has found its business model (and as such, has beaten the more mature Twitter to one). But hold your horses. While Foursquare does have an idea for how to eventually make money (as we’ve discussed in the past), they aren’t actually focusing on making any just yet, co-founder Dennis Crowley confirmed to us today.

The aim is to build deals with retailers so that frequent users get discounts or freebies, but drive other users to the site to buy stuff. These types of deals (dubbed “Mayor Deals” as a frequent virtual user becomes a Mayor* of a place, even though they need never visit it) become a business of some kind. However, the downside of all this was rather well put by Aubrey Sabala in SF Weekly.com

Imagine the following scenario: You're quietly enjoying your tea while reading a newspaper at your local cafe, when someone you've never before seen interrupts your morning respite by hollering your name from the next table. You look up to see them waving frantically, leading you to wonder if one too many tequila shots were the cause of this temporary amnesia. Before you can question the acquaintance, they simply say hold up their iPhone and say: "Foursquare!"

Far-fetched? Nope, just another day in Web 2.0. This exact scenario actually happened this weekend, a result of social network foursquare's recent update: the ability to see who else is checked into a venue. Foursquare - for those not familiar - is a location-based social network where users 'check in' to venues as a way to gain points (currently an nonredeemable social currency) and explore the city.

The article goes on to suggest a few steps you can take to protect yourself, but it all amounts to bodging the desired default workflow. Of course the question you ask, dear reader, is why the change from privacy respecting to privacy invading?. The answer, of course, is money - or rather, how to show a 5 year hockey stick in a revenue model. Plying privacy from the user perspective is not what customers (advertisers, recent funders and businesses) want.

Note to all - in these sorts of consumer services that today skate on the thin ice above the tempting waters of user privacy abuse, mark well the difference between a Customer and a User. A Customer is someone who gives you money, a User is there, well, to be used.

Note the difference well....... there is no regulation, little operating experience and virtually no "good practice code" safeguards to prevent privacy abuse from location based services. Good treatment of the user is at the sole discretion of the supplier, but is not really in it's interest. By this I mean that the average user has very little idea of the medium and long term ramifications of handing over their dynamic data to the public sphere, and thus is less wary than in Real Life. As Mat Morrison noted at TEDxTuttle last week, a huge amount can be deduced just from looking at your friends on a social network. I can tell you, gratis and for free, that a huge amount more can be deduced from your movements. The trend towards default broadcast of position and opt-in tells you which way these systems are being nudged. The opportunities for exploitation are thus larger, and with the pressures on the startups to perform, its hard to believe they will not often be taken.

(Paranoid? Moi? Ah, but I plan to survive..... )

Updates:

- very interesting article by Fred Wilson about Urban (data) Architectures that these sorts of services can bring about. I like this, it shows what could emerge
- a realisation: the main use case here is just the latest transmutation of the 1990's early m-commerce "you get bribed to invite your friends to a cool restaurant" narrative (its also the main use case underlying a lot of the augmented reality startups) but with the added benefit that you hand over your static and dynamic data en route.

*Probably just me, but I wouldn't go near a place that some other d*ckhead has become "mayor" of, especially if they've never even been there.......