What Price Privacy, Paying For Apps edition

There’s a new study on what people would pay for privacy in apps. As reported by Techflash:

A study by two University of Colorado Boulder economists, Scott Savage and Donald Waldman, found the average user would pay varying amounts for different kinds of privacy: $4.05 to conceal contact lists, $2.28 to keep their browser history private, $2.12 to eliminate advertising on apps, $1.19 to conceal personal locations, $1.75 to conceal the phone’s ID number and $3.58 to conceal the contents of text messages.

Those numbers seem small, but they’re in the context of app pricing, which is generally a few bucks. If those numbers combine linearly, people being willing to pay up to $10 more for a private version is a very high valuation. (Of course, the numbers will combine in ways that are not strictly rational. Consumers satisfice.

A quick skim of the article leads me to think that they didn’t estimate app maker benefit from these privacy changes. How much does a consumer contact list go for? (And how does that compare to the fines for improperly revealing it?) How much does an app maker make per person whose eyeballs they sell to show ads?

Should I advertise on Twitter?

Apparently Twitter sent me some credits to use in their advertising program. Now, I really don’t like Twitter’s promoted tweets — I’d prefer to be the customer rather than the product. (That is, I’d like to be able to give Twitter money for an ad-free experience.)

At the same time, I’m curious to see how the advertising system works. I’d like to understand it and blog about it, but Twitter would like to maintain confidentiality around the program. They’re engaged in white-hot competition with Facebook and Google to be the new advertising platform of the future. At the same time, it’s less transparency than the exceptionally high bar that Twitter has generally aspired to.

That said with the launch of Control-Alt-Hack, my collaborators have stuff to sell and give away. (Not to mention maybe a sales bump for The New School of Information Security?) Or maybe I could promote other books that I think people should read, like “Thinking, Fast and Slow“). Does the nature of what I’m advertising change the calculus? Would advertising the giveaway make it different?

Then again, I do lots of “advertising” on Twitter already–I advertise the book, the game, blog posts, ideas I like. Does paying to bring them to more people dramatically change the equation?

Interestingly (and I think this is something that can be discussed, because it’s visible), I’m offered the chance to promote both tweets and myself.

I’d be really interested in hearing from readers about how I should take advantage of this, and if I should take advantage of it at all.

Regulations and Their Emergent Effects

There’s a fascinating story in the New York Times, “Profits on Carbon Credits Drive Output of a Harmful Gas“:

[W]here the United Nations envisioned environmental reform, some manufacturers of gases used in air-conditioning and refrigeration saw a lucrative business opportunity.

They quickly figured out that they could earn one carbon credit by eliminating one ton of carbon dioxide, but could earn more than 11,000 credits by simply destroying a ton of an obscure waste gas normally released in the manufacturing of a widely used coolant gas. That is because that byproduct has a huge global warming effect. The credits could be sold on international markets, earning tens of millions of dollars a year.

That incentive has driven plants in the developing world not only to increase production of the coolant gas but also to keep it high — a huge problem because the coolant itself contributes to global warming and depletes the ozone layer.

Writing good regulation to achieve exactly the effects that you want is a hard problem. It’s not hard in the “throw some smart people” at it sense, but hard in the sense that you’re generally going to have to make hard tradeoffs around behavior like this. Simple regulations will fail to capture nuance, but as the regulation becomes more complex, you end up with more nooks and crannies full of strange outcomes.

We as people and as a society need to think about how much of this we want. If we want to regulate with a fine-toothed comb, then we’re going to see strange things like this. If we want to regulate more broadly, we’ll likely end up with some egregious failures and frauds like Enron or the mortgage crisis. But those failures are entirely predictable: companies occasionally fake their books, and bankers will consistently sell as much risk as they can to the biggest sucker. For example, Bush administration’s TARP program or Seattle taking on $200 million in risk from a hedge fund manager who wants to build a new sports stadium. At least that risk isn’t hidden in some bizarre emergent effect of the regulation.

That aside, long, complex regulations are always going to produce emergent and chaotic effects. That matters for us in security because as we look at the new laws that are proposed, we should look to see not only their intended effects, but judge if their complexity itself is a risk.

I’m sure there’s other emergent effects which I’m missing.

Please Kickstart Elevation of Privilege

Jan-Tilo Kirchhoff asked on Twitter for a printer (ideally in Germany) to print up some Elevation of Privilege card sets. Deb Richardson then suggested Kickstarter.

I wanted to comment, but this doesn’t fit in a tweet, so I’ll do it here.

I would be totally excited for someone to Kickstarter production of Elevation of Privilege. Letting other people make it, and make money on it, was an explicit goal of the Creative Commons license (CC-BY-3.0) that we selected when we released the game.

So why don’t I just set up a Kickstarter? In short, I think it’s a caesar’s wife issue. I think there’s a risk that it looks bad for me to decide to release things that Microsoft paid me to do, and then make money off of them.

Now, that impacts me. It doesn’t impact anyone else. I would be totally excited for someone else to go make some cards and sell them. I would promote such a thing, and help people find whatever lovely capitalist is doing it. I would be happy to support a Kickstarter campaign, and would be willing to donate some of my time and energy with things like signing decks, doing a training sessions, or whatnot. I even have some joker cards that you could produce as a special bonus item.

So, if you think Elevation of Privilege is cool, please, go take advantage of the license we released it under, and go make money with it.

[Update: I don’t have exact numbers, but have seen quotes for quantities around 5,000 decks, production might be around $2-3 a deck. At smaller quantities, you might end up around $5-7 a deck. YMMV. So a Kickstarter in the range of $5-10K would probably be workable, although you’d certainly want to think about shipping and handling costs.]

Kind of Copyrighted

This Week in Law is a fascinating podcast on technology law issues, although I’m way behind on listening. Recently, I was listening to Episode #124, and they had a discussion of Kind of Bloop, “An 8-Bit Tribute to Miles Davis’ Kind of Blue.” There was a lawsuit against artist Andy Baio, which he discusses in “Kind of Screwed.” There’s been a lot of discussion of the fair use elements of the case (for example, see “Kind of Bamboozled: Why ‘Kind of Bloop’ is Not a Fair Use“). But what I’d really like to talk about is (what I understand to be) a clear element of copyright law that is fundamental to this case, and that is compulsory mechanical licensing.

In TWIL podcast, there’s a great deal of discussion of should Baio have approached the photographer for a license or not. He did approach the copyright holders for Kind of Blue, who were “kind” enough to give him a license. They gave him a license for the music, but he didn’t need to approach them. Copyright law gives anyone the right to record a cover, and as a result, there is a flourishing and vibrant world of cover music, including great podcasts like Coverville, and arists like Nouvelle Vague, who do amazing bossa-nova style covers of punk. (Don’t miss their cover of Too Drunk to Fuck.) And you can listen to that because they don’t have to approach the copyright holder for permission. Maybe they would get it, maybe not. But their ability to borrow from other artists and build on their work is a matter of settled law.

I’m surprised this difference didn’t come up in the discussion, because it seems to me to be kind of important.

It’s kind of important because it’s a great example of how apparently minor variations in a law can dramatically change what we see in the world. It’s also a great example of how constraining rules like mechanical licensing can encourage creativity by moving a discussion from “allow/deny” to “under what circumstances can a copyright holder use the courts to forbid a copy.” If we had mechanical licensing for all copyrighted materials, Napster might still be around and successful.

It’s a Lie: Seattle Taxpayers Will Pay for a Staduim

The Seattle Times carries a press release: “Arena plan as solid as it looks?

The intricate plan offered for an NBA and NHL arena in Sodo hinges on the untested strategy of building a city-owned, self-supporting arena, without the aid of new taxes, and with team owners — not taxpayers — obligated to absorb any losses.

This not only a lie, it is a blatant lie, contradicted by statements later in the article:

…Seattle and King County would finance $200 million — likely in bonds — to cover construction costs. The city would recoup its money through lease payments and the taxes on everything from tickets to concessions from the arena.

Let me translate that into plain English. The taxpayers of Seattle and King County would sign a bond. We’d be obligated to pay it back if or when the Supersonics new team leaves town. Also, let me comment that the use of “would” is inaccurate. The word that the writers sought and were unable to come up with is “might”, as in: “the city might recoup its money…”

One more quote:

It’s hard to argue against the idea of an arena that pays for itself.

It’s even harder to guarantee it, though.

Actually, it’s easy to guarantee that the arena pays for itself, or at least that the taxpayers don’t pay for it. The builders finance the arena. See how easy that is? They issue the bonds, they reap the profits. Then the people of Seattle and King county are guaranteed to not be on the hook.

Pretty simple, if the Seattle Times would stop relaying lies about who’s on the hook for bonds issued by Seattle or King County.

Look, while I’m opposed to having to sit in traffic for yet more sporting events, I shouldn’t have a say in how these folks spend their money. The arena backers should feel free to spend their money, plus as much as anyone will loan them, to build a stadium, buy a team, or hold a parade. That’s what freedom is about. But the people of Seattle should not carry any of the risk. The money should be entirely private.

Maybe the plan can’t work without Seattle bearing some of the risk. If that’s the case, that’s because this isn’t the sure thing that its backers want us to think. It means that the bankers see this as a risky thing, and want to transfer that risk to some sucker. I don’t want to be the sucker who’s paying for a failed deal. Do you?

The Pre-K underground?

Not my headline, but the New York Times:

Beyond the effort was the challenge of getting different families to work together. When matters as personal as education, values and children are at stake, intense emotions are sure to follow, whether the issue is snacks (organic or not?), paint (machine washable?) or what religious holidays, if any, to acknowledge. Oh, and in many cases, forming a co-op school is illegal, because getting the required permits and passing background checks can be so prohibitively expensive and time-consuming that most co-ops simply don’t. (“The Pre-K Underground“, The New York Times, December 16)

Read the whole thing, and then give some thought to how effectively those policies, combined with the drug war, are de-legitimizing governments, and convincing people that to live their lives involves avoiding government rules. Eventually, even legitimate and necessary functions of government like courts will fall apart.

Think I’m exaggerating?

“There’s a fairly stringent code and byzantine process for getting certified and code-compliant,” said City Councilman Brad Lander, a Democrat from Brooklyn, whose office held a meeting over the summer for any co-ops interested in pooling their resources and securing permits. “Some are genuinely for the safety of kids, and some are more debatable.”

There’s a city councilman driving doubt over the system. What does that do to the legitimacy? What happens to the social contract?

Will the war on coop kindergardens join the war on drugs?

I’d like some of that advertising action

Several weeks back, I was listening to the Technometria podcast on “Personal Data Ecosystems,” and they talked a lot about putting the consumer in the center of various markets. I wrote this post then, and held off posting it in light of the tragic events in Japan.

One element of this is the “VRM” or “vendor relationship management” space, where we let people proxy for ads to us.

As I was listening, I realized, I’m in the market for another nice camera. And rather than doing more research, I would like to sell the right to advertise to me. There’s a huge ($59B?) advertising market. I am ready to buy, and if Fuji had shipped their #$^&%^ X100, I was about ready to buy it. But even before the earthquake, they were behind in production, and I’m ready to buy. So I could go do research, or the advertisers could advertise to me. But before they do, I want a piece of that $59B action.

I don’t want to start a blog. (Sorry, Nick!). I don’t want to sell personal information about me. I want another nice camera. How do I go about accepting ads into this market?

I’m willing, by the way, to share additional information about my criteria, but I figure that those have value to advertisers. Please send in your bids for the answers to specific questions. Please specify if your bids are for exclusive, private, or public answers. (Public answers prevent others from gathering exclusive market intelligence, and are thus a great strategic investment.)

So, dear readers, how do I get a piece of the action? How do I cash in on this micro-market?

If I get a highly actionable answer, I’ll share 25% of the proceeds of the advertising with whomever points me the right way.