The Hidden Economy of Your Data

In today’s digital ecosystem, your personal data—your social security number, phone number, email address, and more—is more than just personal information; it's a valuable commodity actively traded in a shadowy marketplace. Data brokers, companies that collect, analyze, and sell personal information, operate in this space with little regulation. 

In this blog, we explore the intricate details of data brokerage, revealing how your data is harvested, used, and monetized, and the real-world impacts of these practices.

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How do data brokers work?

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Data brokers are entities that gather vast amounts of personal information from various sources to create detailed profiles, which are then sold. These companies often operate without direct consumer interaction, and their activities remain largely opaque, even as they affect millions of lives. The FTC estimates that there are thousands of data brokers worldwide, many of which are based in the United States, generating billions of dollars in revenue annually.

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How do they get your data?

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Data brokers compile your information from multiple sources:

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• Public Records: Government databases are a primary source, including records from the DMV, court systems, and federal agencies.
• Commercial Transactions: Every purchase you make, particularly online, can be tracked and recorded, ranging from your shopping habits on e-commerce platforms to subscription services and grocery purchases.
• Social Media and Online Behavior: Data brokers use sophisticated algorithms to scrape social media platforms and track online behaviors, collecting data on your interests, social interactions, and even political views.

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How much is your data worth?

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The economic landscape of personal data is diverse and its valuation depends on various factors including demography, data type, and the medium through which it is obtained. Here's a deeper look into this complex market:

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• Demographics Influence Data Value: Data costs can vary significantly based on demographic information. For example, data related to males costs around $0.15 per individual while females are slightly less at $0.14. The age group of 18-24 years fetches a higher price at $0.36 due to their active online engagement and purchasing power. Interestingly, Middle Eastern ethnicity data is valued the highest among ethnic groups at $0.62, reflecting its rarity and potentially high demand in specific markets.
• Healthcare Records: Fetch the highest market price, averaging $250.15 per record due to the comprehensive nature of the data they contain.
• Payment Card Details and Banking Records: These are also highly valued, with average prices of $5.40 and $4.12, respectively, due to their direct financial utility.
• Basic Personally Identifiable Information (PII): Even simple data like basic PII is traded, albeit at a much lower price of $0.03.
• Social Security Numbers and Credit Records: Trade at $0.53 and $0.31 respectively, highlighting the darker aspects of data brokering where sensitive information is used for nefarious purposes.
• Accounts and Credentials: Prices can vary widely, for example, hacked Facebook accounts may sell for $65, reflecting the personal and potentially exploitable information available through social media.

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The data brokerage industry generates substantial revenue from selling personal information. In 2022, the global market for data brokers was estimated to be worth over $200 billion, a figure that is projected to grow as digital data continues to expand in volume and variety.

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How does it affect you?

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The activities of data brokers can have direct and noticeable effects on your daily life:

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• Spam and Scams: An increase in spam calls and emails can often be traced back to your data being sold. In 2021, Americans received nearly 50 billion robocalls, many of which originated from data obtained by brokers.
• Personalized Advertising: Ever receive an ad for a product just moments after talking about it? This isn't coincidence but the result of sophisticated data analytics performed on the information collected about you.
• Credit and Insurance Decisions: Your financial options can be limited based on the information sold by data brokers to financial institutions, which use this data to make decisions about creditworthiness and insurance rates.

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Does the government not care?

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There is growing legislative attention to the practices of data brokers. The EU’s General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) represent significant steps towards regulating the acquisition and use of personal data. These laws give individuals the right to know what data is collected about them and to request its deletion. 

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But that’s not enough - the best way to protect your identity is to be proactive and take control of your data. Be mindful of the information you share online and through apps - Cloaked can help with that! Regularly update your privacy settings on social media and other online platforms. And finally, know and exercise your rights under laws like GDPR and CCPA to control your data.

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