This is How Tech Giants Like Google Make Money with Your Data

Google, money, data

This article was last updated on September 14, 2023

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Unveiling the Strategy of Tech Giants

Large tech companies such as Google and Facebook parent company Meta know us very well. Based on our viewing behavior, our search history, and how we scroll and like on Facebook, they collect a lot of information unnoticed. Not for nothing, of course: this is how the tech giants make their money.

While you as a user are scrolling carefree on one of the platforms, data is collected behind the scenes. For example, Facebook measures how long you look at messages, TikTok remembers which videos you watch and which comments you read, and Google Maps knows where you go a lot. By processing all this information, the companies know your preferences and can show you things that match.

The Data Collection Process

The companies make it very difficult for users to find out their strategy, says data ethicist Piek Visser-Knijff. “It is important as a consumer to know that the companies have two faces,” says Visser-Knijff. “Being a free social platform on the one hand and running a huge advertising market on the other.”

While installing different apps, you as a user get a lot of questions. The makers want you to accept the terms and conditions, ask if they can send you push notifications and want to view your location data. The companies hope that you agree to the terms and conditions, share your location data, and accept cookies. This way you help the companies keep track of your data.

Why Your Data is Valuable

This data is stored in enormous data centers. By combining the information from different users, the big tech companies can estimate very precisely which content to show to whom.

Algorithms are trained with this data. You can see an algorithm as a smart calculation formula that determines what you see and where in your timeline. For example, a user who is very into sports and sportswear will see more sports-related advertisements and messages than others. Algorithms can guide consumers in (purchasing) behavior.

It is very valuable for tech companies to be able to show users appropriate advertisements and messages. Then there is a greater chance that consumers will be seduced by the advertisements. Moreover, users stay on the platform longer if they recognize themselves in what is shown.

Balancing Personalization and Privacy

While personalized content can be enjoyable and convenient, it is important to be aware of the constant surveillance by tech platforms.

“It is important to create sufficient awareness among users,” says Sander Klous, professor of Big Data Ecosystems. Not everyone has the same knowledge of the power position and working methods of large tech companies. In addition, reading the general terms and conditions takes a lot of time.

Last month, a major step was taken in the Digital Services Act (DSA) to limit the power of big tech. As a result, companies are no longer allowed to use sensitive data from visitors for personalized advertisements. They also need to explain more about the advertisements to their visitors.

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