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Never Lost, Always Found: The business case for privacy

Never Lost, Always Found: The business case for privacy. 2nd Annual Privacy and Security Workshop Faculty Club, University of Toronto Nov. 1, 2001 Lawrence Surtees Senior Telecom Analyst, IDC Canada. Agenda. Global wireless penetration/growth; Canadian market

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Never Lost, Always Found: The business case for privacy

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  1. Never Lost, Always Found:The business case for privacy 2nd Annual Privacy and Security Workshop Faculty Club, University of Toronto Nov. 1, 2001 Lawrence Surtees Senior Telecom Analyst, IDC Canada

  2. Agenda • Global wireless penetration/growth; Canadian market • Wireless Internet market & forecast • Wireless location & Mobile e-commerce markets • Privacy implications • Consumer attitudes to location technology and online privacy

  3. IDC’s International Research Austria Benelux Czech Republic Denmark Finland France Germany Greece Hungary Italy Norway • • • • Malaysia New Zealand Nigeria Philippines Singapore South Africa Taiwan Thailand • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • United States Argentina Brazil Canada Chile Colombia Mexico Venezuela Australia China Egypt Hong Kong (AsianResearch Center) India Indonesia Israel Japan Korea PolandRussia Spain Sweden Switzerland Turkey U.K. • • • • • •

  4. Rising Concerns Over Personal Privacy:1970-1998Q: How concerned are you about threats to your personal privacy in America today - very concerned, somewhat concerned, only a little concerned or not concerned at all?Source: Louis Harris & Associates; Privacy Journal 2000

  5. Global Wireless v. Wireline GrowthSource: IDC, March 2000

  6. Wireless Ascendant: Canadian Subscriber Forecast, 1999-2005Source: IDC Canada, Oct. 2001

  7. Canadian Wireless Revenue, 1999-2005Source: IDC Canada, Oct. 2001

  8. Number of Canadians on the NetSource: IDC Canada, 2001 ICMM Version 7.1

  9. Canadian PCS Phones With Internet Access (%)Source: IDC Canada, May 2000

  10. Canadian Wireless Internet Access, 2000-2005(Millions users)Source: IDC Canada, 2001, ICMM Version 7.1

  11. Wireless Internet Use RisingBrowser hits/month (‘000); Jan-Oct 2000Source: Bell Mobility

  12. Non-PC Devices & Internet AccessSource: IDC Canada ICMM version 7.1, June 2001

  13. The Internet & eCommerce in CanadaSource: IDC Internet Commerce Market Model, v6.0 Jan. 2000 Consumer ecommerce: 2004 $19B Business-Business ecommerce 2004 $129B

  14. Mobile e-commerce in CanadaSource: IDC Canada ICMM v. 7.1

  15. Services Menu Gateway OSS / Legacy Interconnect NGN OSS: Wireless CRM Customer Interaction Portals Admin-istration Self- Service End User Hosted / Enterprise Apps Customer Relationship Management Billing System Mgmt Workforce Management Customer Care ERP eCommerce Bill Presentation Contracts, SLAs, Entitlements Sales Force Automation &Order Config Customer Records Load Balancing / Node mgmt 3rd party And legacy apps Trouble Ticketing CRM Invoicing OSS/Service Commerce Engine Rating Performance Management Accounts Receivable Service Fulfillment Directory Network Monitoring Application Performance Application Management Assign & Design Inventory Mgmt LDAPDirectory & API INA QoS AAA Perform. And Reporting App & Network SLA Mgmt Service Activation Elements/ Features Bundle Definition & Management Apps (e.g. e-mail, www) ToIP VPNs Wireless Provisioning Version & License Control Role and Access Definition and Management Service Activation

  16. Portal Portal Portal $ Location Determination Content Content Content $ Service Provider $ $ ASP ASP ASP $ $ Integrator Financial Integrator Financial Financial Integrator WASPs: Future Wireless Carrier Collector Service Provider Source: IDC

  17. Location Determination Location Determination: • By 2003, over 50% of all cellular, PCS and SMR subscribers will have end-user equipment that allows location determination, rising to 83% by 2005. Location Determination is defined as the ability of the wireless provider to determine the position of the caller to within 50m for 67% of calls and 150m for 95% of calls. Source: IDC, Wireless Location-Based Services Update: Market and Analysis 2000-2005, April 2001

  18. Focus group findings A focus group test of user tolerance for advertising in new media based on two-hour interviews with six groups of Internet-savvy, communications-intensive consumers (three college-age and three adult). (Kiersted and Thorat, IDC Report, Dec. 2000).

  19. MPC Internet WAP Gateway MPC Privacy Rules SMSC Privacy Issues & Location-Based Services • Protection of Privacy Rights are central to the LBS design • Real time customer control • Real time customer visibility • Application Specific Rules • Time based Privacy Rules • Subscriber Control of accuracy level

  20. Location Determination II Location Determination: • By 2005, location determination services revenue explodes to $5.7 billion for cellular, PCS and SMR subscribers. Revenue is defined as that generated directly from the location-based services, such as driving directions, location-specific directory assistance, restaurant reservation services, etc., and does not include indirect revenue, such as increased airtime charges due to higher MOU. Source: IDC, Wireless Location-Based Services Update: Market and Analysis 2000-2005, April 2001

  21. Platform for Privacy Preferences (P3P) • Question: When P3P is operational and bundled into browsers, will preference-settings be pre-loaded to: - favor the collection of user data (opt-out); or -will they be set at maximum privacy protection level (opt-in)?

  22. Wireless Advertising Wireless Advertising: • Wireless ad revenues will explode from $1.9 million in 2000 to $7.7 billion in 2005 • CAGR of 429%! • Contributing Factors: • Wireless Internet growth • Wireless SMS growth • Location-determination allows highly targeted ads Includes ads delivered to wireless subscribers over both wireless Internet and wireless SMS. Source: Valuable Real Estate: Advertising on the Wireless Internet, March 2001

  23. Wireless Device Form-Factors

  24. Say cheese on wireless - Compaq iPAQ H3650 Pocket PC • Memory • 32 MB RAM • Operating System • Windows-Powered Pocket PC • Battery • Lithium Polymer • Processor • 206 MHz Intel StrongARM • Weight • 6.3 oz. / 170 grams (including battery) • Screen • Touchscreen • Reflective front-lit TFT • 240 x 320 resolution • Dimensions • 5.1” x 3.2" x .62 • 130 x 15.9 x 83.5 mm

  25. The case for legislated protection • Continued business ambivalence • Superficial adherence to four pillars of privacy protection • Increased consumer trust

  26. Factors Driving Corporate InfoSec InvestmentsSource: IDC Canada, April 2001; N=200Q: Which ONE of the following factors is most important to driving your current investment in security?

  27. Seals versus Legal?AT&T Labs Survey, 1999 Asked whether respondents would be more or less likely to provide personal information if: • the site had a privacy policy stating information would be used only to process the request; • a law prevented the site from using information for any purpose other than processing the request; or • the site had both a privacy policy and a seal of approval from a well-known organization such as the Better Business Bureau. Source: Lorrie Faith Cranor, Joseph Reagle and Mark Ackerman. Beyond Concern: Understanding Net Users' Attitudes About Online Privacy. AT&T Labs-Research. Technical Report TR 99.4.3. April 14, 1999. www.research.att.com/resources/trs/TRs/99/99.4/99.4.3/report.htm.

  28. Frequency of Privacy Concerns Causing U.S. Web Users to Leave a Web SiteQ: Over the past six months, how many times have you left a Web site primarily due to privacy reasons? N=779Source: IDC Online Consumer Internet Privacy Survey, Oct. 2000

  29. Warning: No single privacy solution can fit all needs.

  30. Frequency of Privacy Concerns Causing Canadian Web Users to Avoid e-CommerceQ: Have concerns over privacy of personal information on the Internet affected your decisions to purchase online?N=3,026Source: IDC Canada e-Omnitel Consumer Internet Privacy Survey, Aug. 2001

  31. Message from survey data - Privacy is not only GOOD for business… but essential for e-commerce. And there are novel methods to protect consumer privacy online.

  32. Privacy Enhancing Technologies • E-wallets; • Single-use credit cards; • Anonymizer sites and software; • Cookie crunchers; • Protective browsers; and • Personal firewalls. . .

  33. Secure wireless components

  34. Payment Agent ArchitectureSource: IDC, 2000

  35. Internet User Familiarity with Privacy OptionsQ: How familiar are you with the following consumer online privacy tools?N=779Source: IDC Online Consumer Privacy Survey, Oct. 20001=not at all familiar; 5=very familiar

  36. This Presentation: Lawrence Surtees lsurtees@idccanada.com 416-369-0033 ext. 297 Customer service: Stephen Symonds IDC Canada 416-369-0033 ext. 266 Want More Information?

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