Algorithmic Transparency Is the Next Disruption for Tech Companies

The current notion of personalization is fairly shallow. Users can customize the kind of content they receive via Google Alerts and blog or website subscriptions, but not in the way an underlying infrastructure handles it. For comparison, this is like being able to choose your car’s color but not the make or model.

For personalization to carry any meaningful benefit, it must begin to impact the algorithms and infrastructure at the lower stacks of digital interactions. Privacy is paramount for users, evidenced by the University of Phoenix findings that nearly two-thirds of U.S. adults on social media claim to have been hacked.

Users have constantly evolving levels of control when it comes to how pictures, videos, audio files, and other pieces of online content are handled. Now, the opportunity exists to follow the same scheme in terms of algorithms. Open algorithms give all users, regardless of technical ability, the level of control and transparency that’ll help them feel sure that their personal information is secure.

The Opportunity of Open Algorithms

A group that includes MIT Media LabOrange, and the World Economic Forum is pioneering this movement through its Open Algorithms project, known as OPAL. Essentially, the goal is to create a hub of anonymized data to which everyone from telecom providers to major banks would contribute. Then, the users themselves would take advantage of visual tools to connect relevant data sets in ways that satisfy their individual needs and wants.

The brief history of the internet is filled with swift failures on a massive scaleFacebook’s Cambridge Analytica debacle is proof that even major players would be wise to use new business models to secure long-term viability. The concept of open algorithms creates new challenges, but it also provides sweeping opportunities for monetization as end users become co-developers on a platform.

The current model of hoarding user data to predict what kind of advertising they want to see is primitive and outdated. In an ecosystem of open algorithms, Facebook and Google could inspire users themselves to choose the advertisements they want to see, leading directly to more conversions. Businesses can utilize this data to craft ads that best approach a target audience: Instead of guessing what an ad should contain, data tells you what might pique a target audience’s interest, leading to more targeted messages and a potential for more conversions. Ultimately, this approach benefits users, developers, and advertisers in ways that are too exciting to ignore.

Once the concept of open algorithms reaches maturity and widespread adoption, it will lead to sweeping changes in how we understand digital interactions:

Services Will Become Decentralized and Democratic

A company like Google or Facebook will still be the core enabler of a service, but the end user will have far more control over the behavior of the platform. Certain protocols will still exist, but users will be able to set up groups and behaviors that are flexible and variable. They will be able to control their interactions to a much greater extent while contributing to the platform in meaningful ways.

Google and Facebook’s new location-sharing offerings — Location Sharing and Live Location, respectively — could present privacy issues but represent a step forward in the open algorithm discussion. In Facebook’s case, the live location-sharing feature is embedded in the Messenger app and allows the user to share his or her real-time whereabouts for one hour.

Each service allows users to control how much information is shared about their locations and, more importantly, who can track them. If these users continue using location platforms and other offerings that utilize open algorithms, they’ll want to know how their information will be protected within those ecosystems.

Users Will Own Information and Form Independent Connections

Services like Amazon or Spotify exist inside rigid silos. Currently, Facebook monopolizes 50 minutes daily of the average user’s time. In a future of open algorithms, users will be able to link and travel between platforms with far greater freedom. We will no longer think of platforms as independent islands, but rather as building blocks we can construct according to our own agendas.

You’ve seen Facebook, Twitter, and other social media platforms link to an Instagram. But now you’re seeing Spotify partner with Facebook to import contacts, show what friends are listening to, and let users share music on their timelines and discover new artists.

The open algorithm movement could eventually lead to Facebook users being able to customize their own Spotify dashboards on the site and upload playlists and favorite songs from there. Sites that are one-stop shops for measuring social media imprint are nothing new, though very few give users the chance to balance all their social presences in one spot.

Orange, meanwhile, is teaming with colleges and universities to help cultivate public-private relationships surrounding big data. Individual schools can compile information and use that data for respective bits of social good. This is just a small glimpse of what we could see as open algorithms become more prevalent.

Closed Algorithms Will Fight for Survival

The internet is locked in a battle over more control versus more democracy, one that will soon begin to affect core players who are currently committed to closed algorithms, but it won’t be easy to convince companies with traditional “I own your data, so I’ll sell your data” business models, which depend entirely on “black box” data and privacy approaches, to open their ecosystems.

Amazon’s algorithm for compiling “frequently bought together” recommendations has been criticized for something along these lines. Just five days after a subway explosion in London last year, British shoppers received suggestions for bomb ingredients while perusing the site for groceries and other accessories. Earlier that year, a U.K. newspaper noted, Amazon had bomb-making books on offer just days after a terrorist attack in Manchester. After the London attack, members of Parliament asked Amazon to look into tightening up its algorithms.

While mistakes like Amazon’s are avoidable and unfortunate, the financial potential for open algorithms will be too much for closed-algorithm enthusiasts to combat. In fact, an Accenture study found that 75 percent of consumers will buy products that address them personally or remember past purchases.

The convenience factor of open algorithms puts users in the driver’s seat to control everything they see and don’t see. Taking out that middleman could allow businesses to charge more on services, meaning customers may gladly pay more for personalization options.

New Business Models Will Develop and Dominate

Similar to the way peer-to-peer file sharing disrupted the music industry, open algorithms will disrupt the information economy. Facebook is a dominant marketing platform, one that, according to Social Media Examiner, is used by 93 percent of social marketers. But the future success of Facebook will not be owed to the amount of data it has control over. It’ll come via the amount of agency that users have over their own data. The flexibility of open algorithms is what will continue to drive traffic to the platform and continue to make it an appealing ecosystem for advertisers.

Open algorithms are a technical challenge, but the greatest hurdle to adoption is one of attitudes and cultures. Users are already clamoring for the kind of freedom that open algorithms provide. The platforms that embrace, rather than fight, this freedom will be well-positioned for the next generation of online life.

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