Besides ecommerce one really big Internet business model obviously is the trade or monetarization of data. This Blogpost reminded to write an article about this topic.
I think the author points out the most important facts! Services like Facebook / gmail / Youtube and so on are not free. Moneywise they are free of charge but with your data you pay a price for using it. Luckily for Facebook / Google and co. most people don’t know the value of their data which turns Facebook, Google and co. into very successful business models generating billions of us dollar.
Since it is very easy to collect data on the web and only very few people understand the dynamics of the Web. I would guess that right now this is one of the most profitable business models on the Internet.
Your contact data vs. data about your interests that define you
Think about it. Giving your name and adress to me even in public on the internet doesn’t allow me to do any business. While building my social network metalcon I experienced something interesting. People have been scared as hell to provide their real name while registering with metalcon. But talking to some of the users in reality they did not realize that the data they produce while using the plattform is what should rather scare them.
You don’t believe it? Let us look into to data facebook is collecting from you in order to monetarize it.

What  obvious facts does facebook know about you?

• first of all the interests from your  profile
• who your friends are
• The interests of your friends.

This is already very strong and combined with artificial intelligence will lead to amazing service like friend recommender and highly personalized advertising systems

What not so obvious facts does Facebook know about you?

It is akward that almost no one is aware of the fact that you don’t have to fill out your social networking profile or have friendships to tell facebook your interests (I don’t have friends on facebook and the friend recommender works) . Facebook knows:

• Who you communicate with and how frequently.
• What you are really interested in (you constantly tell facebook by clicking on things and visiting profiles and pages!)
• which people your really know (being tagged together in a lot of fotos is a strong indicator!)
• What websites you surf on (there are like buttons everywhere! and most the time you are still logged in with facebook) it is like criterio
• In which geographical regions you login to facebook
• How many people are interested in you and if you are an oppinion leader

The boldest part is how facebook uses all the knowledge about useres and brands to earn money by just enabling people to communicate

Summeray of the Data trading business model

You run a website that people love and you collect user behavoir and other data they tell you implicitly. This data just needs to define them and their interests. You don’t cara about a name! You make it anonymous just like google serach was for a long time. Now you use this data to create an ad system or anything similar. You can even go out and start selling products your own!

Jumping back in time

I still remember the first days of the internet. You registered on some site and they asked you to fill out an old fashioned survey => very annoying and it was not even helping to earn good money.

• age
• sex
• income
• children
• education
• choose 3 interests
• what papers do you read
• what tv do you watch

In comparison to the Data facebook and Google collect about you that was really innocent. Comparing those modern companies with their sophisticated approaches and compare it to the pioneers in the online user data business it is incredible to see how the .com bubble could really rise up.