As you may have seen over on my twitter feed, I’ve been adding all my photos to Google photos. I have a reasonable number of photos scattered around the place. I was getting tired of not being able to find them, so I decided to centralise them and keep them all in one place. Enter Google photos, which will store my photos for free and makes them searchable. Similar to their other service offerings such as Gmail and Google Search – I am the product. They want my data and will provide a free service to me in exchange for it.
And this got me thinking – am I comfortable being the product and giving them my data for free? Moreover, I need to come up with a blog post to share all these pictures.
Main Photo: Path to Ben Nevis, Scotland.
I tend towards clumsy. I break my phones and laptops on a fairly regular basis. Hence I try to ensure that everything is backed up on the cloud.
But I also tend towards frugal hence I appreciate free services. Therefore I had used a fair few free cloud services over the years. With the end result that my photos, especially those taken on my phone camera were spread all over the cloud.
Aside: a London picture to the right – can you guess where this picture was taken?
So as I researched getting all my photos together, Google photos rose to the top of the offerings – as it was free. Initially, I thought “Thank you Google”. But then I started to think – is Google doing this for altruistic purposes?
What is the business model for this free?
I am grateful for this free service. Nonetheless being cynical and curious, I want to know why this is free. I expect there to be a catch. There is always a catch. Or a footnote. A free lunch usually requires your attendance and email address. Free samples are trying to get you addicted.
And for Google, I am the product. They want my data and are happy to provide these services to me for free. So Google is making me the product and using all my free products to learn about me. Then they can use that data and insight to generate income.
The old way of business – Selling Products
Photo: Callendish Standing Stones, Outer Hebrides
In the olden days, the way to make money was to make products and trade these products with others. It’s a simple business model that we all can understand. Old school manufacturing businesses where someone makes a good and sells the product were the backbone of traditional economies.
These products can be consumer goods that are sold to the end user, or intermediary goods used to make other goods. For most people, this business model makes sense and is easily understandable. A physical product is produced which is easy to see and categorise. We instinctively understand these goods are items we must trade money for. The amount of items that fit this business model is vast. From necessities such as food and shelter to luxury goods such as iPhone and yachts – these are all consumer goods based businesses.
Moreover, it’s not too hard to understand that it’s not that easy to make a cake or a yacht with your bare hands. You need the right machinery. And that machinery itself is produced from metal. Hence we understand the concept of intermediary goods that are sold business to business to make an end consumer product. And it follows on that these supply chains can become complex with many parts needed to assemble together for that yacht.
In summary – the old business model of selling goods – where the product is traded for money – still thrives globally. These manufacturing businesses still employ many and generate profit for the economy albeit they have shifted from developed countries to developing over the last century.
The newer way of business – Selling Services
Photo: Dartmouth, Devon
Moving on from the old school goods based economy is the idea of a service economy. If you define goods as physical things people need and want, services are then the experiences people need and want. These are items that are not physical, but again essential or luxury services that we trade money for. We instinctively understand that we need to pay in money for services such as a plumber or a holiday.
This is more modern than a goods based system and involves skills and expertise being traded. We can understand that we occasionally need the services of a plumber or accountant, and we are happy to trade money for their skills.
In summary – the newer business model of selling services – where the service is traded for money – is a thriving sector in both developed and developing countries.
The new way of business – Selling Data
Photo: Coastal Path, Pembrokeshire
And finally we have a new era – where services are provided for free, and the customer becomes the product.
This is a developing sector in the economy, and lots of companies are providing products for free as they work out how to monetise them. Many run on seed money and venture capital funding and make losses for years, before hitting on an idea that works. As an aside, I have to admit to being one of the sceptics of new businesses that are not profitable. My logical brain struggles to accept that people are taking a risk and trying to find a way to make the businesses profitable.
However, many businesses have now made this business model work – the big ones being Facebook and Google. They provide services to end consumers for free and make their not unsubstantial profits by being able to provide very targeted advertising, as they have your data. They know so much about their users that they can target expertly, allowing business to get the maximum bang for their bucks when advertising.
In summary – the newer business model of selling data – where the user is the product – is a growing sector with increasing employment and companies developing more and more paths to monetisation.
Am I comfortable being the product?
Yes. I am happy being the product. For the price of free, I am happy with this decision.
Moreover, taking this from an exploitation point of view – I am the only person potentially being exploited. I am not comfortable with free when others are treated badly and underpaid, but I am happy to assume the risk personally.
I have made a deliberate decision to provide my data to them for access to these free services. This is a win-win proposition in my eyes and I understand that these companies will then use my data. My life isn’t that scandalous – and I am happy for people to know I take lots of cat pictures and partake in many feminist rants.
Over to you
- What are your thoughts?
- Are you comfortable being the product?