Privacy post-Prism

With the issue of online privacy brought sharply into focus, tech companies are battling to earn the trust of users - including Millennials.

Last July, more than 60 leading technology companies, investors, nonprofits, and trade associations issued a petition calling for greater transparency from the US government over surveillance efforts.

The letter said Americans “are entitled to have an informed public debate” about those government activities, and companies “entrusted with the privacy and security of users' data” should be allowed to report the number of information requests and individuals affected by them. The petition followed revelations in June that the National Security Agency was conducting surveillance on US citizens through user information collected from online companies as part of the agency's Prism program.

The news brought the issue of online privacy sharply into focus, with many tech companies facing greater scrutiny over their privacy practices. Yet because of the secret nature of the NSA's program and laws restricting companies from openly discussing national security data requests, many tech firms find themselves “between a rock and a hard place,” says Matthew Prince, cofounder and CEO of CloudFlare, a cloud-based services provider and one of the companies that signed the petition.

The trust business
“Fundamentally we're in the business of trust – so are Google, Facebook, and Twitter – so we have to do things that ensure our users' trust,” Prince says. “Unfortunately the laws are muzzling the ability for organizations to show they are putting their users first. It creates a conundrum where users lose trust in companies.”

For many tech providers, demonstrating that they safeguard users' privacy is not a new priority, but ongoing media coverage on the NSA's program has highlighted the challenges and nuances of communicating about the issue. It has also demonstrated that consumers of all ages care about privacy, despite generational differences in online behavior.

“These are things we should talk about, debate, and think through,” Prince explains.

News reports about Prism claimed Microsoft collaborated with the NSA in allowing federal agents to access user data. Microsoft denied the claims, saying it turns over customer information only in response to legal requests. Since then, the tech giant has joined other companies in calling for greater government transparency.

Talking privacy
Microsoft has been talking about privacy for more than 10 years, long before revelations about the NSA's surveillance, says corporate VP of corporate communications Frank Shaw. In March, Microsoft disclosed for the first time  the number of requests it had received from government law enforcement agencies for data on its customers, joining the ranks of Google, Twitter, and other companies that do so.

Throughout the year, the company addresses privacy through efforts including advertising, raising awareness on Data Privacy Day in January, blogging about the topic, and participating in panel discussions, Shaw says. Last April, Microsoft launched a marketing campaign with the slogan, “Your privacy is our priority.” The effort included an online safety and security resource center.

Citing company research, Shaw says that while most people worry about their privacy online, only four in 10 understand how to protect it. That's a key reason why privacy will continue to be an area of focus going forward, he adds.

“If you ask almost anyone if they care about privacy, the answer will always be yes. But it means something different to everyone,” Shaw explains. “We have to help them understand what they can do to protect it.”

According to Tina Stow, VP of issues management at APCO Worldwide, companies that have a track record of communicating consistently with customers about privacy will be in a better position to maintain consumers' trust when crises such as the Prism revelations arise.

“Consumers expect brands not only to align with their interests, but also to advocate for them,” Stow says. “The more transparent you can be, when something does go wrong you'll be in a posture that's less defensive. People won't be surprised by your actions because you have been communicating about them the whole time.”

Generational concerns
Some commentators have questioned whether a younger generation, accustomed to sharing more information through social networks, cares as much about online privacy. But Shaw and others reject that notion.

“It's easy to be an old fogey and say, ‘those whippersnappers don't care about privacy' – but that's not really true. They just have different behaviors,” Shaw says. “There is such a great deal of nuance to it.”

According to a recent Ketchum survey, 80% of US consumers aged 55 and older believe it is important for companies to have ethical marketing practices such as respecting customer privacy by not selling customer lists, but among respondents aged 18 to 34, that number drops to 64%.

However, Ketchum conducted another study for a client last fall that revealed 75% of consumers ages 18 to 24 had changed the type of information they share. “People still care about privacy, even this new digital generation,” says Esty Pujadas, partner and director of Ketchum's global technology practice. “All in all, 100% of people believe in ethics, and that's why privacy policy matters.”

“There are generational differences. For example, the Facebook generation is apt to share more – but companies have to take a longer view,” adds Stow.

Concern for privacy among the digital generation is evident on Reddit, the social news and entertainment site, which has seen an increase in discussions on the topic since news broke about Prism, says general manager Erik Martin. Many of Reddit's users joined protests against the NSA's surveillance program, he adds.

“One of the reasons why this generation is so concerned is because they've been sharing so much information online for years. With that volume, they are sensitive to the idea that a government entity or individual could sift through all of that and pull out something incriminating or embarrassing about them,” Martin says.

Reddit's policy on collecting user data aligns with its “minimum approach” to running the site, Martin adds. While many Internet companies target advertising by gathering info on customers such as gender, age, location, and interests, Reddit targets ads through its subreddits, which are forums dedicated to categories such as parenting or home improvement. That strategy allows the company to store only a small amount of customer data, he adds.

CloudFlare's Prince points to the rise of social network Snapchat among younger consumers as an example of privacy concerns influencing online behavior. Snapchat allows users to share photos and videos that delete within 10 seconds.

“They have seen what happens when you share every aspect of your life,” he says. “People are craving to have certain aspects of their life forgotten.”

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