The future of user data
Let’s start with some background. In capitalistic economies, there are producers and consumers. Between these two exists a search problem. Each needs to find the other to be able to transact. In the old economy, TV and News advertisements solved this problem by broadcasting ads to their users. In the internet economy, Google provided a better solution by creating targeted ads.
The Google model was a game changer. Targets ads are more efficient, and producers pay only when their ads are clicked. The simple idea is that if Google knows you well, they can connect you to products that are useful for you. This is why Google offers all its software for free so that they can get to know you as well as possible (GPS location, email, chats, friends, media, etc).
Google’s model has fueled innovation and growth over the last 15 years. But it is not the model of the future. The quest to gather and control data on every human being is inherently evil and will lead to tyranny. If a single entity has control over all data, they most likely will use it for evil or someone will steal it from them and do the same.
The model for the future is one where people have strong property rights over their data. In the future, my data is stored securely and privately on the blockchain, and only I have control over it. I can choose to share my data with decentralized autonomous smart contracts and in return, the contract will suggest products and services that are interesting to me (based on my data). Since these contracts provide a data exchange between consumers and producers, I call them decentralized user data exchanges (DUDE contracts).
Producers will also share their product data with these DUDE contracts. They will pay a fee to the smart contract for the service of connecting them to consumers. The contract can then pay me for the data that I chose to share with the contract. Most likely these contracts will be non-profit contracts that will pay out all of their earnings (net of expenses) to users in return for user data.
For example, if I decide to share my sleep data with a health DUDE contract, I will get a recommendation of products that can help me sleep better. The contract will delete my data after the transaction, and my data will remain private. If I choose to, I can sell my data to the contract. The contract can then sell my user data to producers. I can decide to sell my data anonymously, pseudonymously, or be identified.
Sharing my data with a secure and opensource DUDE contract has no creep factor. Google knowing how much time I spend in the bathroom each morning, and then using that data to suggest products has significant creep factor.
These DUDE contracts will serve as the future Amazons and Googles, providing a market place for consumers and producers while keeping user data private and secure. They will enable property rights for user data. This is a better future than one where Google and Amazon own all of the world’s data.