Sci Tech April 24, 2008, 5:00PM EST

A Rich Vein for 'Reality Mining'

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Even in an imagined crisis, however, such scenarios would raise red flags among privacy advocates. Guilherme Roschke, a staff attorney at the Electronic Privacy Information Center, a nonprofit in Washington, D.C., worries whenever people are monitored without their consent. "There is a lot of new information being collected, and it brings significant new capabilities," he says. "Whenever it's put to a new use, it must be disclosed."

Academic researchers acknowledge the risks and have begun setting rules for how data should be collected and used. "Our first assumption is that people own their own data," says MIT's Pentland. But companies may find it difficult to comply with the new rules. Nathan Eagle, one of Pentland's MIT colleagues, has access to a database that holds an entire month's worth of calling data for a whole European country—he won't say which one. The data set contains information on 250 million cell phones and land lines and some 12 billion phone calls. For research purposes, the data has been scrubbed of all information that might be used to identify individuals.

In Eagle's lab, which is funded partly by Nokia (NOK), he and his colleagues use the data to test the power of their algorithms. They've observed phenomena that may interest the phone companies that own the unscrubbed data. For example, each neighborhood has heavy users who influence other people, say, by proselytizing for new phone applications. Eagle says phone companies can identify these "influencers," and they'll bend over backwards to make sure these subscribers don't jump to rival carriers. "If someone who makes a lot of calls walks away, there's a higher potential that they'll take more people along with them," Eagle says.

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Workplace Confidential

Do you really understand the group dynamics at your company? A branch of reality mining studies "subtle signals" to see how people get along and get things done. Tones of voice, changes in facial expression, and body language may indicate that a team member is running into trouble with his peers, say, or that he's not fully engaged while making a sales call. Writing in the Aug. 29, 2007, issue of Booz Allen Hamilton's strategy + business, Mark Buchanan describes how companies can use electronic sensors to track such signals, which may be below the radar to bosses and co-workers.

Hesseldahl is a reporter for BusinessWeek.com.