PRIVACY FOR SALE

The recent Wikileaks scandal has proven that privacy online is a serious problem that matters to users, businesses and even the government, raising questions about our electronic footprints in cyberspace and the data we share without too much care. It is easy to wonder about our security in the web if even the US government with “the most protected database" and the best technology available is a victim of this, so how can you feel safe browsing and providing information, buying a book on Amazon, or making a payment online?....It seems that users should not be naive or "dumb f…" as said by Facebook CEO, Mark Zuckerberg some time ago:

Zuck: I have over 4,000 emails, pictures, addresses, SNS
[Redacted Friend's Name]: What? How'd you manage that one?
Zuck: People just submitted it.
Zuck: I don't know why.
Zuck: They "trust me"
Zuck: Dumb fucks.

If Facebook CEO, and founder of one the most popular social networks, where millions of people share their private information every day, has this attitude toward privacy, there is too much to be concerned about our safety and privacy rights when using the web.

Our information can be used for different purposes and we do not know the extent and the limits of it. For example, Google uses people’s search criteria to adapt advertisement based on web searches, interests, tastes and geographic locations. However the use of information can go beyond, as Google had to admit that it "screwed up" in collecting individuals' emails via WiFi networks, and the revelation that a Google engineer was fired for snooping on underage teenagers' messages.  It is scaring that users’ behaviors are been used for such purposes, invading individual’s confidentiality.

Even if the purpose is to use data for marketing strategies to help companies to track preferences in order to develop more attractive products, the access to this information should be approved by the users in some way. Otherwise this would be as giving personal information to a total stranger about likes and dislikes, and what is even worse, sometimes the most sensitive personal information.

Although the FTC is trying to regulate and protect the consumer, the current regulations are very unclear and cannot be properly enforced.  In the short run legislation will not provide the necessary actions needed to protect the consumer personal information, as it is stated by reporter Bianka Bosker in her article “Why The FTC's Online Privacy Plan Won't Stop The Information Free-For-All".

At the end the best advice for users would be to behave online as it would be in public, as well as thinking more than once when sharing information in the web because it does not make sense to close the door in your house if you open your personal information on a computer.

GROUPON: A TEMPTATION FOR BUSINESSES AND CUSTOMERS

Groupon, the most recognizable daily deal website, has become the web phenomenon and the temptation for most of the dominant giants in the web, easy to understand when you consider that in only 2 years, has become the leader in this trend, representing a new way of saving money and a marketing opportunity for local businesses. The company has successfully raised about $175 million in early investment money, $50 million a month in revenue and a valuable amount of approximately 35 million users in 30 countries.

The most recent bid has been proposed by Google, a considerable 5.3 billion offering (accordingly to other sources 6 billion) that centers the attention this week as it would give even more fuel for the search giant, which would access to a valuable customer data base divided in geographic segments, as well as access to merchants information around the world, allowing Google to improve its operations in a local perspective. At the same time Google wants to avoid that competitors like Microsoft, Yahoo and Facebook gain power by buying a company like Groupon. Other competitors are taking other approaches, like Amazon that is getting ready for the fight after acquiring Living Social, the most powerful Groupon’s rival.

Even though it seems a very good deal for Groupon to make business with Google, the option of going  alone is also a temptative one, since it has built in such a short amount of time a really successful company, as has been recognized by Forbes Magazine as “the fastest growing company ever“. Besides that, the giants in the web with all their power have tried to start similar businesses without positive outcomes.

 A recognized example is the Facebook case in which CEO Mark Zuckerberg decided not to sell to Yahoo for $1 billion four years ago, and now it is worth more than $20 billion. And the comparison gets more interesting considering that at the time of the offering Facebook had 100 millions in revenue, compared to Groupon’s 500 million revenue announced for this year.

Even tough competitors are rapidly increasing, it is not easy that a different company will grow at that rate, since in technology the first mover gets an extremely important advantage. The Groupon’s clones would need an important workforce to be able to compete and make agreements with merchants in order to get even better deals, it wouldn’t be easy to scale at such a frantic pace. Moreover its huge presence makes competition a challenge for those companies that want to get any of its market share.

If Groupon decides to remain in the market by itself has to considered some important strategies in order to maintain its dominant position, figuring out how to compete with creative startup businesses that can offer more attractive discounts, thus switching the crowd towards other substitutes, and becoming an obstacle on its road.