6 ms·

Value is derived from user data when its used to target ads. Black market data is never used for that purpose, so its value is much lower. (A company would neve

by soared 9y ago

Value is derived from user data when its used to target ads. Black market data is never used for that purpose, so its value is much lower. (A company would never take the risk of using black market data)

manigandham 9y ago
Value is derived from the potential application of data. Ads as an application isn't worth much since you can still be shown ads just fine without any personal data targeting. Black market data is worth way more because it's often more personal than just demographic markers and interests, and can potentially lead to large sums of money.
- soared 9y ago
  Well no that's incorrect. A targeted ad is worth significantly more than one without targeting. I buy ads at a $0.25 cpm and a $40 cpm, the only difference is targeting data.
  - manigandham 9y ago
    You can still show the ads and there are a lot of other signals and context to use. Also other than Facebook or google with strong identity, 3rd party data on the open web is next to useless. If you’re paying $40cpm for data, you’re getting ripped off.
    - soared 9y ago
      Sorry to be that guy, but: I spend over $5m a year on rtb ads. I literally spend 50 hours a week doing this. If the money I spend doesn't produce verifiable results, I lose it. For example, that 40cpm is to reach a pool of <1000 users who are in charge of purchasing for networks of hospitals, and my ads are for MRI machines. 3rd party data is unbelievably valuable, probably $1.5 million of my budget goes to data costs alone.
      - robertlagrant 9y ago
        Might be better off spending £5k+ on personal gifts for each decision maker than bothering with Web advertising if it's that few people you're targeting :-)
        ben_w 9y ago
        I may not be a lawyer, but gifts of $5k to induce someone to purchase a thing for their workplace feels like it should count as corruption and bribery. If someone tried to do that to me, I’d report the attempt to the company lawyer, and I’d doubt the quality of the thing they were selling was as good as the quality of the thing the other poster was advertising.
        sirk390 9y ago
        5k+ per person would be bribery. I hope he meant 5k in total..., 1000 gifts of 5$ would be ok
        midwife_cry_sys 9y ago
        I'm sure he meant what he said. Do the math. He was trying to point out that it would cost the same either way. But if you give the mark the money, it would have a much greater effect than 5k on silly web adds.
        diN0bot 9y ago
        what about a $5k rebate or discount?
        ben_w 9y ago
        Difficult to say. My mental framing has, as a result of my previous post, become “be suspicious”.
        midwife_cry_sys 9y ago
        Oh my God. Seriously? You'd report them? Snitches get stitches. Jam up one of my guys, you'll wish you hadn't. If he's starting with 5k you could easily get a lot more. That is the price for suckers. Course you don't have to take anything but that could be hazardous to yous health. I'm just saying. Take the fucking gift.
  - fny 9y ago
    It still holds the data alone isn't worth much. If you've built an ad platform with customers, reach, and the ability to target people given data, then sure, you can convert that raw material into something more valuable. And once you sell the derived product (ads), you'll be taxed on your income. I feel like you're arguing that dirt is worth as much as the farm that one could build with it.
- lifeisstillgood 9y ago
  Personal information is less valuable on the black market due to the difficulty in monetising and extracting the cash. If I have your bank account login details I can move cash out of your bank, but almost no hope of sending cash from a U.K. Domestic savings account to my friendly philapines bank over the web UI. That's why Nigerian Princes still send out emails - the find the one idiot willing to walk into his bank and move the 5million that just arrived in his account Alternatively you need real criminal gangs - dozens of people willing to walk up and down a London street withdrawing 5k at a time from a 1000 Pre-prepared cards and put the money in their rucksacks. They don't come cheap. And its still cash and still in the U.K. Get Amazon to send you two dozen laptops to the same address with two dozen cards. All as "gifts". Yeah right. Now you gotta sell them - fences run at 10% if you are lucky. The lowest effort are simple impersonation for loans, but still you have to take the money and move it somewhere. Into cash? Into the phillipines? See above problems. Open a credit card account? How to intercept it and the PIN number sent by post? All in all, it's actually pretty darn hard to take personal details and monetise at the "real money" level. These things stop being scalable. You could probably fund a student lifestyle off any combination of the above but millions - not really. Cf interesting Microsoft paper on this a few years back
  - manigandham 9y ago
    I guess we have nothing to worry about with all these data breaches then, right? Might as well tell equifax that it’s no big deal too. These criminals trade data because it makes them money, otherwise there wouldn’t be much of a makrket.
    - _jal 9y ago
      You're correct, of course, but missing the implications raised by the parent poster, and they are important. Sensitive personal data is necessary but not sufficient to rip someone off. And if you want to try to make a living ripping people off, there is even more business overhead, making the cost of sensitive personal data an even smaller portion of overall operational costs. From the point of view of the thief, our personal data is a vital but cheap input into an operation that tends to have very high security costs, viciously expensive liquidity issues and terrible personnel problems, among other more quotidian business headaches.[1] I suggest trying to think like a crook now and then. Trying to try on other people's lives is a useful way of shaking up one's thinking habits, empathy (don't confuse with sympathy) is always useful, and it can help you keep yourself more secure. [1] I am leaving out things like several potential fates far worse than bankruptcy and related issues because they aren't opex-related, but they probably do effect retirement planning.
fny 9y ago
You (and every other responder) miss larger the point of my comment. Let's use Google as an example. Your clicks throughout the internet, like sand, don't amount to much of value. It's a very unrefined, raw material, with limited quantity. Even if Google were forced to value that raw material, they can argue they're trading it in equal exchange for whatever service they offer you, so there would still be no tax. In any situation, potentially derived value is not taxable. A car is worth whatever a car was bought/sold for, not including some hypothetical such as whatever I could make by driving it for Uber/Lyft. What matter's here is what will actually occur in the transaction. If Equifax chooses to sell its data, that income will be taxed at whatever price Equifax chooses to sell the data. Note this doesn't change that your "gift" of peanuts of data is not taxable because (a) your data alone isn't worth squat, (b) even if it was, you got something in exchange for it.
- darkerside 9y ago
  Like data in general, user data is essentially worthless until aggregated en masse and refined into insights. But when you consider how much data companies are hoarding, it doesn't take much of an assessed value to create a nontrivial taxable asset. Also, it doesn't matter that there's an exchange happening. Sales tax and income tax are assessed on fair exchanges of goods, services, and currency.
  - fny 9y ago
    Sales tax isn't paid on trades. When you trade in a car for $2k off a $10k car, you only pay taxes on the difference: $8k. And if you grow oranges on your property that you never sell, you never pay taxes on those oranges.
    - panarky 9y ago
      Not in California. If you accept a trade-in on the sale of a vehicle, the allowance for the trade-in cannot be excluded from the amount on which tax is based. For example, if you sell a car for $20,000 and accept a trade-in valued at $4,000 as partial payment, tax is based on the $20,000 selling price. Source: http://www.boe.ca.gov/pdf/pub34.pdf http://www.boe.ca.gov/pdf/pub34.pdf
BearGoesChirp 9y ago
It isn't clear where the data comes from. A business in a non-US friendly jurisdiction can make an online business selling black market data in a way that looks legal to data warehouse groups who in turn sell it to the company using it. Once you get to the actual company using the data, there is no indication of it being black market data. The middle company, if it is buying enough data, only takes a few employees who care more about getting the data than verifying the ethics. It's kind of like arguing a bank would never create fake accounts because the risk of doing so is too large.
rhizome 9y ago
A company would never take the risk of using black market data I bet LinkedIn does.

by soared 9y ago

manigandham 9y ago

Value is derived from the potential application of data. Ads as an application isn't worth much since you can still be shown ads just fine without any personal data targeting. Black market data is worth way more because it's often more personal than just demographic markers and interests, and can potentially lead to large sums of money.

soared 9y ago
Well no that's incorrect. A targeted ad is worth significantly more than one without targeting. I buy ads at a $0.25 cpm and a $40 cpm, the only difference is targeting data.
- manigandham 9y ago
  You can still show the ads and there are a lot of other signals and context to use. Also other than Facebook or google with strong identity, 3rd party data on the open web is next to useless. If you’re paying $40cpm for data, you’re getting ripped off.
  - soared 9y ago
    Sorry to be that guy, but: I spend over $5m a year on rtb ads. I literally spend 50 hours a week doing this. If the money I spend doesn't produce verifiable results, I lose it. For example, that 40cpm is to reach a pool of <1000 users who are in charge of purchasing for networks of hospitals, and my ads are for MRI machines. 3rd party data is unbelievably valuable, probably $1.5 million of my budget goes to data costs alone.
    - robertlagrant 9y ago
      Might be better off spending £5k+ on personal gifts for each decision maker than bothering with Web advertising if it's that few people you're targeting :-)
      - ben_w 9y ago
        I may not be a lawyer, but gifts of $5k to induce someone to purchase a thing for their workplace feels like it should count as corruption and bribery. If someone tried to do that to me, I’d report the attempt to the company lawyer, and I’d doubt the quality of the thing they were selling was as good as the quality of the thing the other poster was advertising.
        sirk390 9y ago
        5k+ per person would be bribery. I hope he meant 5k in total..., 1000 gifts of 5$ would be ok
        midwife_cry_sys 9y ago
        I'm sure he meant what he said. Do the math. He was trying to point out that it would cost the same either way. But if you give the mark the money, it would have a much greater effect than 5k on silly web adds.
        diN0bot 9y ago
        what about a $5k rebate or discount?
        ben_w 9y ago
        Difficult to say. My mental framing has, as a result of my previous post, become “be suspicious”.
        midwife_cry_sys 9y ago
        Oh my God. Seriously? You'd report them? Snitches get stitches. Jam up one of my guys, you'll wish you hadn't. If he's starting with 5k you could easily get a lot more. That is the price for suckers. Course you don't have to take anything but that could be hazardous to yous health. I'm just saying. Take the fucking gift.
- fny 9y ago
  It still holds the data alone isn't worth much. If you've built an ad platform with customers, reach, and the ability to target people given data, then sure, you can convert that raw material into something more valuable. And once you sell the derived product (ads), you'll be taxed on your income. I feel like you're arguing that dirt is worth as much as the farm that one could build with it.
lifeisstillgood 9y ago
Personal information is less valuable on the black market due to the difficulty in monetising and extracting the cash. If I have your bank account login details I can move cash out of your bank, but almost no hope of sending cash from a U.K. Domestic savings account to my friendly philapines bank over the web UI. That's why Nigerian Princes still send out emails - the find the one idiot willing to walk into his bank and move the 5million that just arrived in his account Alternatively you need real criminal gangs - dozens of people willing to walk up and down a London street withdrawing 5k at a time from a 1000 Pre-prepared cards and put the money in their rucksacks. They don't come cheap. And its still cash and still in the U.K. Get Amazon to send you two dozen laptops to the same address with two dozen cards. All as "gifts". Yeah right. Now you gotta sell them - fences run at 10% if you are lucky. The lowest effort are simple impersonation for loans, but still you have to take the money and move it somewhere. Into cash? Into the phillipines? See above problems. Open a credit card account? How to intercept it and the PIN number sent by post? All in all, it's actually pretty darn hard to take personal details and monetise at the "real money" level. These things stop being scalable. You could probably fund a student lifestyle off any combination of the above but millions - not really. Cf interesting Microsoft paper on this a few years back
- manigandham 9y ago
  I guess we have nothing to worry about with all these data breaches then, right? Might as well tell equifax that it’s no big deal too. These criminals trade data because it makes them money, otherwise there wouldn’t be much of a makrket.
  - _jal 9y ago
    You're correct, of course, but missing the implications raised by the parent poster, and they are important. Sensitive personal data is necessary but not sufficient to rip someone off. And if you want to try to make a living ripping people off, there is even more business overhead, making the cost of sensitive personal data an even smaller portion of overall operational costs. From the point of view of the thief, our personal data is a vital but cheap input into an operation that tends to have very high security costs, viciously expensive liquidity issues and terrible personnel problems, among other more quotidian business headaches.[1] I suggest trying to think like a crook now and then. Trying to try on other people's lives is a useful way of shaking up one's thinking habits, empathy (don't confuse with sympathy) is always useful, and it can help you keep yourself more secure. [1] I am leaving out things like several potential fates far worse than bankruptcy and related issues because they aren't opex-related, but they probably do effect retirement planning.

fny 9y ago

You (and every other responder) miss larger the point of my comment. Let's use Google as an example. Your clicks throughout the internet, like sand, don't amount to much of value. It's a very unrefined, raw material, with limited quantity. Even if Google were forced to value that raw material, they can argue they're trading it in equal exchange for whatever service they offer you, so there would still be no tax. In any situation, potentially derived value is not taxable. A car is worth whatever a car was bought/sold for, not including some hypothetical such as whatever I could make by driving it for Uber/Lyft. What matter's here is what will actually occur in the transaction. If Equifax chooses to sell its data, that income will be taxed at whatever price Equifax chooses to sell the data. Note this doesn't change that your "gift" of peanuts of data is not taxable because (a) your data alone isn't worth squat, (b) even if it was, you got something in exchange for it.

darkerside 9y ago
Like data in general, user data is essentially worthless until aggregated en masse and refined into insights. But when you consider how much data companies are hoarding, it doesn't take much of an assessed value to create a nontrivial taxable asset. Also, it doesn't matter that there's an exchange happening. Sales tax and income tax are assessed on fair exchanges of goods, services, and currency.
- fny 9y ago
  Sales tax isn't paid on trades. When you trade in a car for $2k off a $10k car, you only pay taxes on the difference: $8k. And if you grow oranges on your property that you never sell, you never pay taxes on those oranges.
  - panarky 9y ago
    Not in California. If you accept a trade-in on the sale of a vehicle, the allowance for the trade-in cannot be excluded from the amount on which tax is based. For example, if you sell a car for $20,000 and accept a trade-in valued at $4,000 as partial payment, tax is based on the $20,000 selling price. Source: http://www.boe.ca.gov/pdf/pub34.pdf http://www.boe.ca.gov/pdf/pub34.pdf

BearGoesChirp 9y ago

It isn't clear where the data comes from. A business in a non-US friendly jurisdiction can make an online business selling black market data in a way that looks legal to data warehouse groups who in turn sell it to the company using it. Once you get to the actual company using the data, there is no indication of it being black market data. The middle company, if it is buying enough data, only takes a few employees who care more about getting the data than verifying the ethics. It's kind of like arguing a bank would never create fake accounts because the risk of doing so is too large.

rhizome 9y ago

A company would never take the risk of using black market data I bet LinkedIn does.