There was a time a few years back where privacy was a huge issue on the web. Consumer advocates were up in arms about companies not guarding customer’s information or even selling it to other companies. The apparent issue with that was that companies and spammers will use that information to steal the identity of customers and thereby cause them financial harm or send unsolicited communications.

With the advent of social networks, things seem to have changed.

• There are now 110 million profiles on MySpace.
• There are millions of users sharing their deepest thoughts on YouTube.
• There are over 60 million blogs where users are publishing their thoughts and at times their identification information like email and address.

A lot of the information on these sites makes the job of spammers/companies a lot easier. In addition to providing contact information, this user generated content also provides a great deal of information which can be used by spammers/companies to better target their offers. The strange thing, though, is that the users creating this content do not seem to care. What is going on?

I think what is going on is simple utility optimization. As my economics 101 professor would have said – the utility the users are deriving from participating in these communities is greater then any downside in terms of privacy. Another reason could be that users of these social sites are sharing non-transactional information (as opposed to transaction information like credit cards, SSN etc.) that cannot be used easily to cause financial harm. My guess is that in the busy world that we live in, people are staved for attention. As a result, users in these social sites might actually welcome targeted offers or communications from people who take the time to read through all the information they have published. For social network users this is a way to fulfill the basic need of connecting with other humans. In this sense, the social networks are replacing the real world communities and relationships. It could also be that the tools available right now makes it hard to limit the access to the information to a smaller community. I guess that is what SixApart is trying to address with their new VOX platform.

The big problem with the current system is that information in online communities makes the users a lot more vulnerable compared to real world communities. The reason is that in online communities all information is logged and is available to all seeing eyes of Google and Technorati for perpetuity. See the interesting post from Eric Nolin on the topic (he defines cool sounding “Nolin’s maxim”). Thoughts?