In the closing days of 2011, I offered several technology-based predictions that I thought would come to pass by now. They were the "5 Big Tech Predictions for 2012." In the interests of openness and accountability, it's time I revisited them to see just how well (or poorly) I've done at predicting the future. I've already looked at the outcome of three predictions, each concerned in some way with the rapid growth of data flowing around the world. I got a little ahead of myself on the timetable for those trends, but I think I've done better at the other two, which are two sides of the same coin. Let's dig into the events that have shaped our relationship with privacy this year.
First prediction: targeted "social" advertising will explode
In the closing days of 2011, this seemed like a safe bet. Facebook (NASDAQ:FB) was still the hottest private company in the world, headed toward its inevitable monster IPO. A proliferation of daily deals sites, including both the recently public Groupon (NASDAQ:GRPN) and the Amazon.com-backed (NASDAQ:AMZN) backed LivingSocial, were experimenting with ways to make their offerings more appealing. By then, it was already accepted knowledge that Google (NASDAQ:GOOGL) made use of your search and browsing history to tailor more accurate ads.
These methods seem almost quaint now. Mere weeks into the new year, Microsoft (NASDAQ:MSFT) revealed plans to use a next-gen Kinect to tailor ads in public spaces based on the physical identifiers of individual passerby. Intel (NASDAQ:INTC) has a similar video analytics system that has already been deployed in a Las Vegas casino. A South Korean mall has installed 26 interactive display-screen kiosks that can direct passerby to specific stores based on general search terms, extrapolating interests in the same way Microsoft's system might -- by body identification.
Advertising depends on relevance in order to succeed, and so the big push this year has been primarily toward advertising that can understand you. Omnicom (NYSE:OMC) jumped on that bandwagon early this year with a proposed "real-time engagement engine" that, in theory, should be better able to identify personal interests than a library of Google searches. Target (NYSE:TGT) has been using demographic analytics to identify pregnant women (among other valuable consumer targets) based on their purchases, and using this knowledge to craft advertisements.
Let's face it, nearly the entire pitch for buying Facebook's stock revolves around socially targeted ads. Brand-run Facebook pages can market to their followers, and users will see sponsored ads primarily based on what they like and what their friends have liked. Facebook is getting so pushy with its social targeting that a recent ReadWriteSocial article claims that the social network is using dead people to promote brands they hated in life. Classy move, Mr. Zuckerberg. The opportunity to socially target advertising has also prompted Google to reprioritize its search results based on the posts of people in your Google+ circles. If it matters to your friends, it must matter to you -- at least in theory. It doesn't always work, and it certainly feels intrusive in many cases, which is just one part of the broader push to claim every facet of your life for corporate use.
Verdict: Definitely one of the big corporate trends of 2012.
Second prediction: privacy will substantially erode
You can't have effective targeted advertising without specialized knowledge of the target, and that has been the source of much contention between users and advertisers all year. But advertisers are only one prong of the privacy assault that's hit consumers hard over the past year.
Not only has Facebook mined its users' interests and friendships to pitch products, it's also moved into biometric analysis, of a sort, by acquiring a facial-recognition company that had already provided software for the social network's picture functions. That led to a regulatory crackdown in in the more privacy-minded European market, where Facebook promised to refrain from using facial-recognition technology and the user-identification data generated by its photo software. The more intrusive methods of photo recognition have been taken down, but no one should reasonably expect Facebook to refrain from mining more user data whenever possible. If public opposition weakens, this stuff is going live again.
In many ways, corporate intrusions into people's lives work hand-in-hand with government desires to track and catalog their citizens. The National Security Agency already works with both AT&T (NYSE:T) and Verizon (NYSE:VZ), going so far as to install wiretaps in the carriers' vital transmission hubs. Boeing (NYSE:BA), which owns an Internet-traffic monitoring company called Narus, has contracted with several extremely repressive governments around the world that are interested in keeping a closer eye on what's happening online.
Perhaps most worrying is the thought of thousands of unmanned aerial vehicles hovering over American skies. The FAA's latest Authorization Act will result in regulations for commercial drones by 2015, but police UAVs will be in American skies long before then. A North Dakota court has already cleared the way for the use of unmanned drones in domestic arrests, and police departments elsewhere are already acquiring drones for surveillance -- or possible crowd control. The notion of privacy is somewhat elusive online, where millions are now growing up using their real names on overarching social services that span many sites. Once tiny drones start buzzing through city streets, cameras whirring into focus on each face, the line between a private life and a public one is likely to come into starker relief. This is likely to be the next privacy battleground, but privacy advocates have been pushed back on many fields already.
Verdict: Well under way, with no signs of abating.
An ominous future
As a privacy-minded individual, the thought of constantly being tracked like one of many animals in a zoo fills me with dread. While I recognize the need for advertisers to more effectively make money, I question the need to isolate and analyze each user by their defining traits in order to make a buck. However, I also recognize that this is the logical extension of over a century of marketing advancements, and that advertising that understands its market is always better than advertising that does not.
The big concern lies with a government that feels it necessary to keep tabs on its citizens in so encompassing and in so intrusive a fashion. Technology has brought us to a place where surveillance by drone and analysis by algorithm will soon be far more effective than human investigation. The legal and social outcomes of this shift are worth serious consideration, and should be openly discussed in the halls of power, and by the people it will deeply affect. There has to be an acceptable middle ground between better advertising and intrusive surveillance.
Fool contributor Alex Planes owns shares of Intel. The Motley Fool owns shares of Amazon.com, Facebook, Google, Intel, and Microsoft and has the following options: long JAN 2014 $20.00 calls on Facebook. Motley Fool newsletter services recommend Amazon.com, Facebook, Google, Intel, and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.