Surveillance capitalism traces its roots to Google’s reaction to the 1999-2000 dot-com bust. Up to that point, there was a reasonably balanced power relationship between the nascent web companies who needed users and the users themselves who benefitted from the emerging online services. The phrase ‘if you’re not paying for the product, you are the product’1 was sometimes co-opted to describe this business model.
When the dot-com bubble burst in April 1999 investors threatened to withdraw support unless a profitable business model was applied. In response, Google adopted a straightforward ‘keyword search’ based advertising business model based on Sergey Brin’s and Larry Page’s famous 19982 paper. Advertisers would choose keywords and when users conducted a Google search using these same keywords they would see the adverts.
In parallel to this, there was a realization that Google’s user-generated collateral search data had tremendous predictive value. Google applied their considerable compute ability and proprietary access to this data to predict the kinds of ads their users were likely to click on. It became known as the “click through rate”3 and represented the perceived relevance of an ad. Google offered this new predictive service to advertisers in a black box fashion and advertisers accepted it. The phrase ‘you are the product’ can be changed to ‘your data surplus and predictive behaviours are the product’.
In March 2008, Facebook hired Sherly Sandberg to spearhead their adoption of the surveillance capital business model pioneered by Google. This represented an inflection point and saw the accelerated adoption of surveillance capital techniques by major players such as Microsoft, Netflix, Uber, and many others.
During this transitionary period, internet companies switched from selling products online, to the harvesting of their user’s data as the primary source of revenue. The mechanisms of this new business model were largely kept invisible to users. The benefits of a globally connected community operating in a transparent manner were highlighted while the risks of power asymmetry, social control, and exploitation of users' data remained obscured.
This period of the dot-com bust and emergence of surveillance capitalism is well documented but poorly understood and barely theorised. The blog posts in this section will examine information systems concepts related to data privacy and surveillance capitalism and discuss the power dynamics shaping this evolving paradigm.
Next: Digital Privacy
Serra, R., Weyergraf-Serra, C., 1980. Richard Serra, Interviews, Etc., 1970-1980. Hudson River Museum. ↩︎
Brin, S., Page, L., 1998. The anatomy of a large-scale hypertextual Web search engine. Comput. Netw. ISDN Syst., Proceedings of the Seventh International World Wide Web Conference 30, 107–117. https://doi.org/10.1016/S0169-7552(98)00110-X ↩︎
Lohtia, R., Donthu, N., Hershberger, E.K., 2003. The Impact of Content and Design Elements on Banner Advertising Click-through Rates. J. Advert. Res. 43, 410–418. https://doi.org/10.1017/S0021849903030459 ↩︎