We may espouse privacy, but will pay little for it. From @sominisengupta via @jessebrown, empirical study in Berlin by German Institute for Economic Research.

What’s your privacy worth? According to a recent study by the German Institute for Economic Research, less than 66 cents. The Institute presented moviegoers in Berlin with a choice when they purchased film tickets online. They could buy them from a theatre that demanded their cellphone numbers, which could be used however the theatre pleased, or, for the same price, they could buy a ticket from a theatre that didn’t ask for any personal information.

From “Overexposed” | Jesse Brown | June 2012 | Toronto Life |

The story is more fully described on the New York Times.

The researchers, at the German Institute for Economic Research and the University of Cambridge, turned up somewhat paradoxical results. While the vast majority of their guinea pigs – all in Germany, by the way, where concerns about personal data are perceived to be acute – cared about the collection of certain personal data by an online company, not many were willing to pay to protect it.

The researchers invited 443 participants into a lab in Berlin. They could buy movie tickets from one of two online companies. Both companies asked for names, dates of birth, and e-mail addresses, since the tickets were delivered electronically. One company also asked for a mobile phone number – and that company charged 50 euro cents less for the tickets, or about 65 cents at current exchange rates.

Fewer than one in three participants (29 percent) agreed to pay the extra money keep their cellphone number out of the hands of the online movie ticket company. Only 9 percent agreed to pay a premium to avoid getting marketing e-mails.

But if there was no price difference, more than 80 percent chose the company that collected less personal information. The research report, called “Study on monetizing privacy: An economic model for pricing personal information,” was released by the European Network and Information Security Agency in late February.

[....]  Empirical research on the subject is still in its infancy. … [The] results usually find a gap between what people say and what they do about their privacy online.

The latest survey from the Pew Research Center’s Internet and American Life Project also turned up this paradox. Nine out of 10 people surveyed on the telephone last month said they were satisfied with the performance of search engines. And yet 68 percent said they were “not O.K.” with targeted advertising because they did not like their “online behavior tracked and analyzed.”

What Would You Pay for Privacy? | Somini Sengupta | March 19, 2012 | NYTimes.com at http://bits.blogs.nytimes.com/2012/03/19/what-would-you-pay-for-privacy/.

Original research published at the European Network and Information Security Agency.

Do some individuals value their privacy enough to pay a mark-up to an online service provider who protects their information better? How is this related to personalisation of services? This study analyses the monetisation of privacy. ‘Monetising privacy’ refers to a consumer’s decision of disclosure or non-disclosure of personal data in relation to a purchase transaction. The main goal of this report is to enable a better understanding of the interaction of personalisation, privacy concerns and competition between online service providers.

Nicola Jentzsch, Sören Preibusch, Andreas Harasser | “Study on monetising privacy. An economic model for pricing personal information” | February 28, 2012 | ENISA at http://www.enisa.europa.eu/activities/identity-and-trust/library/deliverables/monetising-privacy.

Study on monetising privacy. An economic model for pricing personal information

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