Revenue streams, trust, and (no) privacy

Stories like “Google developing eavesdropping software” remind me why I have a healthy distrust of any company where the end-users are not the source of revenue. In theory, if I’m paying a company $x/month for some service then that is how the company makes money. If a service is “free”, then I must assume my activity using their product generates revenue for the company somehow — and I feel a lot better knowing that the way a product generates revenue is by me giving them money. Too bad even companies that charge for their products reserve the right to do whatever they want with my data. When the users pay for a service, though, the company jepordizes a revenue stream by irritating its end-users. If the service is free, there’s no real down-side to angering end-users as long as the total revenue generated by all users can go up — in fact it’s usually better if they can generate more revenue with fewer users.

I wish more people understood that nothing is ever free — if a product is free to use it means the company is generating revenue from the end-user activity in some other way. Public companies have only one motivation — make as much money as possible without breaking (m)any laws. Am I the only one alarmed by companies with privacy policies that have no sunset clause on data they collect? Yahoo and Google both say that they can keep the log of all of your activity on their services forever.

Google’s policy seems stronger than Yahoo’s with regard to sharing the data with outside parties until you realize that both of these companies are big. You don’t have to share the information with an outside company if you can buy or build the kind of processing you need — they don’t have to share your information with an ad-serving company because they are the ad-serving company.

Of course, Amazon.com keeps all your activity on Amazon.com forever, too. And I use credit cards. So it’s probably ridiculous for me to really think I have any privacy at all.