Privacy is Essential to the Success of Digital Identity – and the Big Players know it

In a move which has attracted relatively little fanfare – but which has significant implications for digital marketing – LinkedIn last week purchased the digital identity management company Drawbridge, which will now be integrated into the social network’s advertising business.  Drawbridge specialises in identity resolution, a type of digital marketing based on identifying individuals operating across multiple different devices and platforms.  The solution helps companies achieve deeper understanding of their customers by connecting and unifying datasets from various online sources to create a complete picture of a person – not just how they behave on, say, Facebook or their laptop – then combines these with data from a range of offline interactions.

While at a glance this may sound like a privacy nightmare, LinkedIn is in fact positioning its use of Drawbridge as a way of gaining an edge on its social media peers in the trust stakes. Questions will of course arise over what safeguards are in place to protect user privacy in such deployments, and whether consumer confidence may be at risk.  Tomer Cohen, LinkedIn’s VP of Product, insists not however, writing in a blog following the sale that “as we integrate Drawbridge’s technology into LinkedIn, we will continue to maintain the strong controls our members and customers have over the data they choose to share with us.”

The move signals the seriousness with which the social media giant, and its owner Microsoft, now take digital identity as a key driver of revenues.  Drawbridge itself is small enough that Microsoft wasn’t even required to disclose the terms of the sale, but the impact that sale could have on Microsoft’s stake in the advertising market is far from small.  LinkedIn currently represents around 5.5% of Microsoft’s total revenue, and much of that comes from the 630-million-member platform’s targeted advertising.  LinkedIn Marketing Solutions has already seen 46 per cent growth year-on-year, and revenues from the company’s digital adverts – a majority of which are viewed on mobile devices – are now projected to exceed $2 billion this year.

Interestingly, and perhaps encouragingly, one of Drawbridge’s existing customers, Samsung, has entered a partnership which echoes this statement of priorities. Late last month Mastercard and Samsung announced their partnership to deliver a more efficient and secure means of identity verification by mobile device, and thereby open up vast new opportunities for mobile shopping globally. The solution dispenses with login details and passwords – relying instead on biometrics or a single digital ID – and places an emphasis on privacy-by-design. “At Samsung, we believe consumers should be in complete control of the privacy and security of their personal identity and we’re excited to work with Mastercard to bring the first digital identity solution to Samsung smartphones,” explains Yongje Kim, Head of Service Business at Samsung. The solution is aimed not only at retail purchases and run-of-the-mill services, but also more sensitive uses such as opening bank accounts or accessing emails and social media channels.

The collaboration follows on Mastercard’s Consumer-Centric Model for Digital Identity, released towards the end of March, which reads almost like a manifesto: the Model covers 10 digital identity ‘rights’ for the consumer, from inclusion to access to choice. “It’s about giving the user control over how and when their data is used, allowing them to easily manage and share their,” explains Ajay Bhalla, President of Cyber and Intelligence at Mastercard. “Our digital and physical lives are merging and we need an identity solution that reflects this reality,” he added. “Without control over how their data is used people rely on outdated systems that compromise their security. Our collaboration is bound to a trusted device – the mobile phone – used by millions of people every day.”

The emphasis on privacy is welcome, and understandable – from a business perspective as well as an ethical one. As the points of attack for hackers multiply as the world becomes more connected, and people seek protection of their most sensitive information, there are truly vast commercial opportunities for those able to provide it. The recent Research and Markets 2019 report on identity finds that identity verification market is expected to more than double by 2024, with APAC – the world’s most connected region – forecast to grow correspondingly the most.  And even today in the least connected continent, governments across Africa are estimated to be in line to save £50bn through the use of digital identities, often in countries where value for money to the tax payer is sorely needed.  But whatever role one plays in this story, it is clear the gains cannot be made if users come to regard digital identity solutions themselves as a threat to their most private data. The growing consensus that privacy does matter, therefore, is to be welcomed for all our sakes.