01/09/2011 08:18 pm ET | Updated May 25, 2011

Macrowikinomics : Privacy in the Age of Facebook

This article is part of a series written by Don Tapscott and Anthony D. Williams, authors of the newly released book Macrowikinomics: Rebooting Business and the World. Mark Parker, the CEO of Nike calls it "A masterpiece. An iconic and defining book for our times." The Economist says it's a "Schumpeterian story of creative destruction."

The book argues that many of the institutions of the industrial age have finally come to the end of their lifecycle, and are now being reinvented around a new set of principles and a networked model.

Today's blog looks at the threat posed by social media to our concept of privacy.


Every business needs to design privacy principles and practices into their operations. An excellent candidate for such a process would be Facebook, because there's no doubt its Achilles heel is privacy.

In the past we only worried about Big Brother governments assembling detailed dossiers about us. Then came what privacy advocates called Little Brother -- corporations that collect data from their customers.

Companies such as Amazon want to know more and more about what makes each of us tick -- our motivations, behavior, attitudes, and buying habits. The good news is that they can use this intimate knowledge to give us highly customized services. The bad news is that once these digital mirror images are compiled they are rarely, if ever, deleted. They can be used inappropriately and even end up being sold to third parties.

Now there is a new unexpected threat -- ourselves. Call it Baby Brother. With the meteoric rise of social media, we are increasingly willing accomplices in undermining our own privacy rights. Before Facebook arrived, who would have predicted that hundreds of millions of people would voluntarily log on to the Internet and record detailed minute-by-minute data about themselves, their activities, their likes and dislikes, and so on?

To make things worse, some social networking leaders confuse the right to privacy with transparency, arguing that transparency is good for individual relationships. In the book The Facebook Effect, David Kirkpatrick explains that some Facebook executives think transparency is not just an opportunity for companies and other institutions to disclose pertinent information about themselves. (This is the definition of transparency.) They believe it's an opportunity for individuals to do so as well.

The Facebook founders believe that "more visibility makes us better people. Some claim, for example, that because of Facebook, young people today have a harder time cheating on their boyfriends or girlfriends. They also say that more transparency should make for a more tolerant society in which people eventually accept that everybody sometimes does bad or embarrassing things."

Some at Facebook refer to this as Radical Transparency -- a term initially used to talk about institutions, and now being adapted to individuals. "Our mission since Day 1 has been to make society more open" says Dave Morin, one of Facebook-founder Mark Zuckerberg's inner circle. In other words, everyone should have just one identity, whether at their workplace or in their personal life.

This is misguided. Transparency applies to organizations, not people. Organizations are increasingly obliged to communicate pertinent information to their customers, shareholders, business partners and so on. This is not the case for individuals. Indeed, individuals have an obligation to themselves to safeguard their personal information. And institutions should be transparent about what they do with our personal information.

This situation poses an unprecedented challenge for government and regulators because it has turned traditional privacy laws and regulations upside down. Privacy and data protection laws ensure that organizations collect, use, retain and disclose our personal information in a confidential manner. But today the biggest threat is not other organizations, it's us.

There are probably thousands of recent university graduates who didn't get that dream job because the employer did a "reference check" online and found them doing something inappropriate.

At the same time, new risks and threats such as identity fraud and theft are growing in a networked world, along with new forms of discrimination and social engineering made possible by the surfeit of data. Personal information, be it biographical, biological, genealogical, historical, transactional, locational, relational, computational, vocational or reputational, is the stuff that makes up our modern identity. It must be managed responsibly.

Ultimately, in order to properly protect privacy, all of us will need to be vigilant about our own online behavior.

Macrowikinomics available at:

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