Bloomberg News

Zuckerberg’s Data Stance Faces Privacy Backlash in Europe

February 20, 2014

Mark Zuckerberg

Mark Zuckerberg, chief executive officer of Facebook Inc. Photographer: David Paul Morris/Bloomberg

As delegates gather for the Mobile World Congress in Barcelona next week, they’ll see the smiling mug of keynote speaker -- and Facebook Inc. boss -- Mark Zuckerberg splashed across brochures and websites. Chema Alonso better represents the prevailing mood.

The scruffy computer whiz oversees digital security for phone carrier Telefonica SA. While he won’t have the bully pulpit of Zuckerberg, who has long preached the benefits of sharing personal data, Alonso’s focus on helping users maintain privacy captures the zeitgeist at the wireless industry’s biggest annual gathering.

Since former U.S. National Security Agency contractor Edward Snowden last year revealed the extent of government surveillance, European carriers such as Telefonica, Deutsche Telekom AG and Orange SA have started offering more control over everything from banking data to social network posts. Facebook’s Feb. 19 announcement that it’s buying messaging service WhatsApp, with 450 million users, further underscores the issue of data security since the deal would give the company access to even more details of users' lives.

“Privacy is the big topic this year.” said Alonso, who last year joined Telefonica from Informatica64, a Web-security company he founded in 1999.

After Snowden began leaking documents, Telefonica stopped automatically collecting anonymized user data, even if that makes it harder to gather information needed to provide services such as traffic reports and shopping recommendations.

Privacy Dashboard

In a survey on European attitudes toward privacy commissioned by Orange, 78 percent of respondents said they have little confidence that corporations will safeguard their personal data, though phone companies fare better than the titans of the Web. Some 41 percent of respondents said they trust their mobile carrier to keep their information safe, versus 20 percent for social networks like Facebook or Twitter Inc.

“There’s real anxiety among consumers about how their data could be used fraudulently or without their knowledge,” said Vincent Carre, who heads Orange’s data-privacy unit. “Operators are in a great position to reassure customers.”

Orange is testing a “privacy dashboard,” an application that shows users how their data is being used and by whom. The service might show online shoppers that their favorite merchant, for instance, logs their location and browser history to target them with future sales. Orange plans to distribute the app across Europe by 2015.

Beaming Foursquare

Consumer demand for more control over shared data marks a shift from last year. Then, Dennis Crowley, chief executive officer of location-based social media app producer Foursquare Labs Inc., told the Mobile World Congress that using a phone to log where you dine, drink and shop wouldn’t cut it anymore; The phone should automatically beam your whereabouts.

This year, Zuckerberg will give a keynote address on Feb. 24. The Facebook CEO will talk about the importance of extending the Internet’s reach to the farthest corners of the earth, the company says, without providing details. Facebook places great emphasis on keeping customer data secure, and has in recent years boosted security to prevent third parties from accessing accounts, spokeswoman Tina Kulow said.

Zuckerberg’s data-sharing evangelism is facing resistance even from carriers that haven’t turned to long-haired computer geeks like Alonso for help. In August, Deutsche Telekom set up a cybersecurity unit, and at the show it plans to show a modification of the Firefox mobile operating system that lets users control, from a single screen, what kind of data individual programs can share.

Cordon Sanitaire

While navigation tools need exact location data, weather applications would function just as well if they merely knew the current city, Deutsche Telekom says. The carrier next month will unveil a Samsung Electronics Co. phone that lets users cordon off sensitive information from installed apps that may try to access it. In October, the German company invested in security software startup Lookout Inc.

Phone companies are well positioned to ensure data security because selling user information to advertisers isn’t central to their business model, said Stephen Deadman, Vodafone Group Plc’s head of privacy.

“If you’re an app developer and you’re providing a free service, you’re effectively trying to monetize the data,” Deadman said.

Vodafone is working on a Web-based control panel that lets customers decide what information to share. Customers will receive rewards if they opt in, he said, declining to provide specifics as the tool is still being developed.

Kill Switch

From Telefonica’s headquarters on the outskirts of Madrid, computer whiz Alonso leads engineers at a unit called ElevenPaths. Its developers have created programs to test the vulnerability of computer systems and to wipe sensitive metadata from documents, such as location information attached to digital photos.

One of ElevenPaths’ first products, introduced in December under the name Latch, lets smartphone users remotely switch off online accounts, blocking access even by those who have the passwords. The program will be pre-installed on all Telefonica smartphones as early as next quarter, Alonso said.

“We need to discuss what the responsibility of the big players on the Internet is,” he said. “How do we provide users the tools and service needed to manage their personal data? Once you share your personal data it’s not personal at all anymore.”

To contact the reporters on this story: Cornelius Rahn in Berlin at crahn2@bloomberg.net; Marie Mawad in Paris at mmawad1@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net


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