The mobile spy in your pocket

Eeric Knorr

A big chunk of the big data trend is about collecting and processing information to predict what you want to buy at any given moment. No wonder, because the incentive is huge.

Global spending on Internet advertising topped $100 billion last year. Big data processing to create rich user profiles — based on cookies, clickstreams, keywords in social media content, and so on —can go a long way toward delivering more targeted and effective advertising.

Mobile devices are raising this guessing game to a new level, because GPS enables them to know exactly where you are at any given time. In the past, I've mainly thought of mobile location-awareness as an opportunity for, say, brick-and-mortar stores to deliver a special 20 percent off coupon when you're just around the corner. That idea has been around for 15 years.

But there's a deeper user profiling aspect to this: You are where you go.

The notion that mobile location is not merely transient, but persistent data embedded in your user profile comes courtesy of a recent conversation with Gil Elbaz, CEO of Factual -- an Andreessen Horowitz startup that calls itself the "king of location data," with high-quality information on more than 65 million places around the world. The company's Geopulse Audience product analyzes "the geo-behavior of mobile users to generate rich user profiles to help you understand your users."

Elbaz notes that, under most circumstances, this information is not personally identifiable. But when you start to think about the explosion in wearables as well, the depth of the information that can be collected is mind-boggling.

For example, on Saturdays, I like to take long bicycle rides. From my iPhone's GPS it's pretty clear I'm too slow to be riding in a car and too fast to be on foot, so I must be on a bike. If an advertiser cared, it could determine by my speed what kind of rider I am (slow), mash that up with my age and income, and predict exactly the sort of equipment I'd be most likely to buy.

In digital marketing circles, the operative phrase is "location is the new cookie." Just think for a minute how many apps on your smartphone ask for your location in addition to whatever mapping service you use — not just Foursquare and Uber, but virtually every social networking app. Once you opt in, that app is free to collect location data and, depending on the terms of service, potentially provide it to marketers or other third parties.

The dark side of this is all too obvious, beginning with the NSA backdoors that might provide access to such information. (If you're in a paranoid mood, check out the cool new ACLU videoabout how law enforcement might use location data; it's about cell location, but same idea.) Government snooping aside, how about insurance companies? It's easy enough to determine if you're in a car that's breaking the speed limit — and boom, your rates go up. And your health-monitoring watch? I'm not sure I want Cigna to know my heart rate when I'm climbing a hill on my bike.

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