Europe caught in a privacy loop?

1. Göttingen, 5 July 2011
Kimon Zorbas,
Vice President IAB Europe
CONSENT Social Networking Summit
Consent – Reality and fiction
1
The European Trade Association of the digital and interactive marketing
industry representing the National trade associations and Corporate members

2. QUICK REALITY CHECK
 Zuckerbertg: „Privacy no longer social norm“
 Really? Just for fun: bing or google “sex zuckerberg“
 Consent is about interaction with sites and services
 How much do we really care? Do you read all
contracts you sign? All general terms & condition in
every store you enter? Is that informed and specific
(acc. to DP Dircetive 95/46/EC)/
 What are the facts? Who reads privacy policies?
 Understanding of economics & business models
behind
 What do users really want and how to get there? 2

3. SOME FACTS ON CONSUMER ATTITUDE
 Do we need to protect the user or is the user
smarter than policymakers think?
 MCDC, IAB Europe, February 2010:
 http://www.iabeurope.eu/media/43499/mcdc%20eur
opean%20overview.pdf
 ‘Special consumers’, policymakers: Fleishman-
Hillard survey: http://www.epdigitaltrends.eu/
3

4. 0% 25% 50% 75% 100%
75%
69%
35%
31%
16%
13%
13%
I'm aware that others can see
what I do on a social network
and thereforeI pay attention to
what kind ofinformation I
release on a socialnetwork
When filling in my profileon
social network sites, I am always
truthful
I trust social network sites notto
violate my privacy bysharing my
personal information
I think it is advisable for brands
or products to create an identity
on social network sites
I add personal information(e.g.
address, mobile phonenumber')
about myself to (some) social
network sites
When filling in their profileon
social network sites, others are
always truthful
I have multipleidentities online
(e.g. my profile is different
depending on the socialnetwork
site I'm on)
Informational Trust
Social Networks Trust
Q : To what extent do you agree with each of the following statements?
(Top 2 % on a 5-point Scale)
TOP 3
3 2 1
BOTTOM 3
16 15 14
I'm aware that others can see what I do on a social
network and therefore I pay attention to what kind
of information I release on a social network
When filling in my profile on social network sites, I
am always truthful
I think it is advisable for brands or products to
create an identity on social network sites
I add personal information (e.g. address, mobile
phone number…) about myself to (some) social
network sites
When filling in their profile on social network sites,
others are always truthful
I trust social network sites not to violate my privacy
by sharing my personal information
I have multiple identities online (e.g. my profile is
different depending on the social network site I'm
on)
TOP 1 : Best scoring country
TOP 2: Second best scoring country
TOP 3: Third best scoring country
BOT 14: Third worst scoring country
BOT 15: Second worst scoring country
BOT 16: Worst scoring Country
EUROPE

5. 0% 25% 50% 75% 100%
71%
62%
60%
43%
20%
I pay attentionto thekind of
information I put ontheInternet
(e.g. on a website,social
network, blog, discussion
board...) -To what extent doyou
agree with each ofthefollowing
statements?
When filling outpersonaldetails
to register myself ona website, I
am always truthful -To what
extent do you agreewith each of
the following statements?
I am sceptical about
companies/websites that ask
many personal details during the
registrationprocess -To what
extent do you agreewith each of
the following statements?
In general I trusttheinformation
that is available ontheInternet -
To what extent doyou agree
with each ofthefollowing
statements?
I don't mind that other people
can find informationaboutme
on the Internet - To what extent
do you agree witheachofthe
following statements?
Informational Trust
Internet Trust
Q : To what extent do you agree with each of the following statements?
(Top 2 % on a 5-point Scale)
TOP 3
3 2 1
BOTTOM 3
16 15 14
I pay attention to the kind of information I put on the
Internet (e.g. on a website, social network, blog,
discussion board...)
When filling out personal details to register myself on
a website, I am always truthful
I am sceptical about companies/websites that ask
many personal details during the registration process
In general I trust the information that is available on
the Internet
I don't mind that other people can find information
about me on the Internet
TOP 1 : Best scoring country
TOP 2: Second best scoring country
TOP 3: Third best scoring country
BOT 14: Third worst scoring country
BOT 15: Second worst scoring country
BOT 16: Worst scoring Country
EUROPE

6. 10%> European Average
10%< European Average
Informational Trust
Awareness Website Privacy Policies
Q : Did you know that most websites provide a privacy policy and have you consulted one before?
43
30
44
27
52
47 44
37 40 38
46
61
52
38
51 49
36
33
39
25
39
25 36
28
34
43
38
36
27
31
37
34
25
36
25
31 31 34
23
17
28 29
18
24
18
12
17
26
16
26 28
0
10
20
30
40
50
60
70
80
90
100
I
w
43
30
44
27
52
47 44
37 40 38
46
61
52
38
51 49
36
33
39
25
39
25 36
28
34
43
38
36
27
31
37
34
25
36
25
31 31 34
23
17
28 29
18
24
18
12
17
26
16
26 28
0
10
20
30
40
50
60
70
80
90
100
No,I did not know this
YesIknew, but I have not read a
privacypolicy on a website before
YesIknew and I have read a privacy
policyona website before
43
30
44
27
52
47 44
37 40 38
46
61
52
38
51 49
36
33
39
25
39
25 36
28
34
43
38
36
27
31
37
34
25
36
25
31 31 34
23
17
28 29
18
24
18
12
17
26
16
26 28
0
10
20
30
40
50
60
70
80
90
100
No,I did not know this
YesIknew, but I have not read a
privacypolicy on a website before
YesIknew and I have read a privacy
policyona website before

7. 8%
7%
9%
7%
3%
24%
5%
5%
16%
13%
8%
6%
13%
5%
8%
2%
5%
48%
39%
56%
32%
48%
50%
37%
58%
51%
59%
46%
58%
55%
64%
49%
43%
57%
35%
44%
28%
42%
44%
19%
43%
30%
30%
25%
38%
26%
26%
26%
31%
48%
30%
9%
10%
7%
19%
5%
7%
14%
8%
3%
3%
8%
10%
7%
5%
12%
7%
8%
Europe
Belgium
Netherlands
France
Germany
Spain
Denmark
Finland
Greece
Hungary
Italy
Norway
Poland
Romania
Sweden
Switzerland
United Kingdom
Yes, a lot Yes, a bit No, not really No, not at all
10%> European Average
10%< European Average
% Top 2
56%
46%
65%
39%
51%
74%
42%
63%
67%
72%
54%
64%
68%
69%
57%
45%
62%
Informational Trust
Trust in Website Privacy Policies
Q : Do you have more trust in a website when it provides a privacy policy?

8. 0% 25% 50% 75% 100%
Commercial Trust
Advertising on Social Networks
Q : To what extent do you agree with each of these statements?
(% Top 2 on a 5-point scale)
I don’t mind that companies advertise on social
networks
I don’t mind that companies create brand / product
pages on social networks
I don’t mind that to receive personal messages on
social networks from brands I like
I don’t mind that to get news updates on social
networks from brands I like
As a user of a free social network I expect to receive
advertising
I am comfortable with receiving ads on social
networks targeted to me based on the information on I
provide in my public profile
32%
34%
29%
35%
36%
25%
I don't mind that companies
advertise on socialnetworks
I don't mind that companies
create brand/product pages on
social networks
I don't mind to receivepersonal
messages on social networks
from brands I like
I don't mind to getnews updates
on social networks frombrands I
like
As a user ofa free social network
I expect to receiveadvertising
I am comfortablewith receiving
ads on social networks targeted
to me based on theinformationI
provide in mypublic profile
TOP 3
3 2 1
BOTTOM 3
16 15 14
TOP 1 : Best scoring country
TOP 2: Second best scoring country
TOP 3: Third best scoring country
BOT 14: Third worst scoring country
BOT 15: Second worst scoring country
BOT 16: Worst scoring Country
EUROPE

9.  Objective – reliable, robust and
defendable research, analysing
consumer benefits of ad-funded
services.
 Provide research to business.
 Contribute to facts-based policy
debate by demonstrating the
immense value brought to
consumers.
 Download:
http://iabeurope.eu/media/3955
9/whitepaper%20_consumerdri
vingdigitaluptake_final.pdf
SOME ECONOMICS: MCKINSEY WHITE PAPER:
CONSUMERS DRIVING DIGITAL UPTAKE

10. Web services
30
20
Free
services
120
0
30
Paid
services
100
Two-thirds of the total Internet surplus is captured by consumers
€ billion per year (2010)
Exhibit 6
2218
12
Paid
services
30
8
Adver-
tising
30
Consumers Producers
Surplus
Web access
Access
120
100
20
Consumers Producers
Surplus
Access
120
70
50
Total Internet Surplus
26
1111
52
100% = 190 billion
Consumer
surplus
Producer
surplus
Service
Access
Service
Access
+ =

11. The value is concentrated in five sub-segments with
clear preferences
High value
segments
Low value
segments
Low
High
Size (%)
ALL MARKETS
Premium
services 2
21.0 17.5 67.6 -1.8 -1.2 103.1
Segment Entertainment Web services AdvertisingCommunication Privacy
Willingness to pay
Net WTP
Premium
entertainment 1
18.9 66.0 18.2 -1.7 -0.4 101.0
69.2 15.0 18.3 -1.5 -1.2 99.9
Premium
communication 4
29.1 12.0 20.3 -2.9 -1.8 56.7
Complete internet
offer 7
11.6 4.6 9.1 -2.3 -1.1 21.9Traditionalists
26
Ads & privacy
concerned 1
20.0 16.0 19.3 -29.5 -9.1 16.7
Fair deal
users 19
3.9 3.9 -5.5 02.2 -4.5
2.7 1.4 2.4 -1.0 -0.4 5.0Price segment
40
Average 10.3 5.0 8.1 -2.7 -1.6 19.1
€/month
Exhibit 11

12. ICO – APPROACH
12

13. CONSEQUENCE: 90 % TRAFFIC NOT TRACKED
13
Source: http://www.flickr.com/photos/vickyb/5859873960/in/photostream/

14. SOLUTIONS?
 Privacy by Design? Likely
 Privacy by Default? Unlikely, but easier handling
 Competition? Will address key points
 Evolution – products, e.g. Privowny
 Legal evolution?
 Current regime sensible:
 Consent & explicit consent
 Expanding explicit will downgrade protection as users
will always confirm or always reject
 ICO – example leading?
14

15. Thank you for your attention!
Kimon Zorbas
Vice President, IAB Europe
vp@iabeurope.eu