The tech giants are fighting privacy regulation: what price will we pay for a free digital society?

The Developers Alliance's criticisms are self-serving and omit any mention of opportunities, argues privacy campaigner Geoff Revill

This week the Developers Alliance, an industry group whose members include Google, Facebook and Comcast, published its perspective on a report funded by consultancy London Economics Europe (LEE) about the financial impact of the new EU ePrivacy regulation. The Alliance stated that it would reduce turnover in Europe by ‘up to' €551.9bn annually.

Scary right? But hold on. A few additional perspectives may help balance this scaremongering story.

First, the turnover of the EU is €26.6tn, so this mooted €551.9bn would represent a two per cent drop in annual turnover. Certainly not insignificant.

The next thing to understand is that the current draft ePrivacy regulation is just that, a draft, so the figure is calculated on a worst case speculation.

More important is to understand the hole that ePrivacy plugs in current legislation. As the LEE report itself states: "In the absence of the ePrivacy regulation no other rule to protect privacy of electronic communications would apply".

So this possible €551.9bn impact is comparing ePrivacy to no regulation, or the current status quo.

Telcos have been complaining for years that they are heavily regulated whereas the OTT (Over The Top) service providers, those deploying app/web-based data services over the Internet for communication services, have been running around virtually unregulated for years creating a very unequal competitive market. In this the telcos are right.

But think for a second: apart from a few worries by some about GCHQ monitoring you - for the purpose of keeping you safe - when you make a phone call you fully expect who you talk to and what you say to be confidential - and it is thanks to telco regulations. In short, we have learned largely to trust these aspects of our communications infrastructure.

Yet our trust in digital services is under continuous attack with survey after survey showing it to be in decline as more and more hacks and breaches are reported every day. Added to this, the (at the very least) unethical practices of OTT companies like Facebook in the Cambridge Analytica case have woken us all up to the real-world societal risks of poorly regulated data monopolies based in countries largely outside our jurisdiction.

The data goldmine

I have been involved with the Internet since its inception. In fact I can claim to have written part of the code that you used when you (if you're of a certain age) first moved from a dial up modem to an instant digital connection, not that I had much of a clue of the impact of what I contributed in building.

There was a time when the free unregulated space that was the Internet was a wonderful thing. Many of the OTT incumbents of today started early and have delivered fantastic innovations and many positive changes on society. However, they were developed on business models devised at a time when no-one knew how to make the Internet pay, when there was a limited number of adopters that they needed to grow.

The goldmine they struck was our data. By offering ‘free' services we became the product they sold. The more users the more they sold, and so the data surveillance economy grew. But we are waking up to the fact that as digital becomes integral to society it needs to be held to account to acceptable societal standards.

What this LEE report completely fails to discuss or investigate is the opportunity behind regulatory change. In fact the document is littered with comments about ‘uncertainty' as a ‘freezing effect' on business, and its financial numbers derive from this perspective. Uncertainty maybe true for incumbents (who make up almost all those reviewed) who suddenly realise that monetising us is no longer their prerogative, and society is fighting back via regulations.

Regulation drives opportunities too

For EU businesses it's a new opportunity. A way to rethink our digital services - and most importantly the business models that drive them - in a way that encompasses societal understanding of the risks and benefits of the digital age.

If we redefine the way the Internet is monetised, move away from a surveillance-led economy to a service-led one with an audience that understands the increased trust that can place in such services, we'll see an increase in data exchange with companies who respect our rights and ultimately understand their role in sustaining a free society.

This is a highly exportable type of digital business that would be welcomed by other countries, even in the US where the primary incumbents are based. I lived there, my daughter was born there and I visit quite regularly, so I can confidently state the EU is not alone in understanding this need for change, its just taken the initiative to lead it.

The competitive opportunity regulation like the ePrivacy represents is the root cause of the ‘perspective' in the Developers Alliance review of the LEE report - which they commissioned.

On behalf of those fighting for a better Internet, I'd like to suggest we find a way to welcome the ePrivacy regulation and make it work to our competitive advantage and to rebuild trust in our digital services. The next Alphabet or Facebook could be EU- or British-based if we do.

Geoff Revill is a privacy campaigner and CEO of Krowdthink