The Bankwatch

Tracking the consumer evolution of financial services

On privacy and the new publicy | what is a bank to do?

There is a theme developing that we may all wish to consider and begin thinking about. It goes to to the core of what many/most believe but the challenge remains … coming, and it is coming fast.

First this from Mark Zuckerberg in an interview with an unusually passive non-alpha Mike Arrington where he (Mark) indicates the notion of retaining information privately in Facebook is gone, and was a mistake to have thought about it that way from the beginning. See ReadWriteWeb for Marshals views.


Next is the ever thoughtful JP who has been pounding on the Facebookisation of us all, and here tracks it down to email as a walled garden in essence that ignores customers. (PS .. JP pls fix your site javascript problem).

Then we have the true philosopher of these web times, Stowe Boyd reflect on the the shift from privacy as the dominant view to publicy and quotes attributed to Laurent of LIFT fame.

Relevance to Bankwatch:
This situation presents an intolerable problem for Banks. I have written about other bank problems, including (brief summary here):

  • reputation risk: the notion that reputation is something to be controlled and kept private at all costs because to do otherwise would be to lose control
  • information risk: the reality that banks’ systems are organised around products and that customers will never be uniquely identified by the bank
  • disintermediation: banks inability to respond to removal of the middleman .. because their model is predicated on being a middleman

These three problems facing banks become starkly realistic when we layer on the elimination (ok, softening) of privacy as we have known it. A fundamental human trait has always been the one that we can walk away. We can lock the door, pull the sheets over our head, and go private.

It is too simplistic to believe that that privacy capability and desire will disappear. Zuckerberg is no strategist or visionary. He is however reflecting a shift that is real and is happening now, and he does have 350,000,000 customers.

What these writers fail to see is that the future is never a linear extrapolation of the last 3 months. These directions are real, and of that there is no doubt. By the same token we will see new tools that are directed to what people want. If people do not want privacy, and that primeval desire is actually gone, then, the Zuckerberg /Boyd view will prevail. I do not believe that.

I believe the future will be more complicated, and that there will be applications that will be presented to FaceBook Connect that address other views. This will generate a fascinating debate, esoecially the one about whether FB will accept those apps.

Meantime, who wants to be a Bank while all this gets sorted out?

Written by Colin Henderson

January 10, 2010 at 17:48

3 Responses

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  1. What is dead isn’t privacy (“Privacy is dead” is just a buzz tactic), what is dead is privacy by default. Instead, public is the default, privacy is the option.

    Guillaume Lebleu

    January 11, 2010 at 01:47

  2. @Guillaume … I agree. However as easy as the words are to say, it is a significant shift for almost everyone to appreciate. We have grown up with privacy as the default.

    Colin Henderson

    January 11, 2010 at 22:41

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