We stumbled across this article in the Pittsburg Post Gazette over the weekend, and think this article belongs on your “must read” list this week: Your Online Attention, Bought in an Instant. The article discusses how, on the internet, we are all being sized up by algorithms that are judging us by what we Google, what sites we visit, and the ads we click. Unbeknownst to us, our profiles are being sold to the highest bidder in a process of real-time-bidding that takes place in milliseconds.
Does this sound familiar? Does this remind you of stock exchange data feeds? Does it remind you of how wholesalers and high frequency traders all fight to get access to the “dumb order flow”? It should. Please read this article! We share with you some salient teasers:
Think of these systems as a sort of Nasdaq stock market, only trading in audiences for online ads. Millions of bids flood in every second. And those bids — essentially what your eyeballs are worth to advertisers — could determine whether you see an ad for, say, a new Lexus or a used Ford, for sneakers or a popcorn maker.
Rubicon is among a handful of technology companies that have quietly developed automated ad sales systems for Web site operators. The bidders are marketers seeking to identify their best prospects and pitch them before they move to the next Web page. It is a form of high-frequency trading — that souped-up business of algorithm-loving Wall Streeters. But in this case, the prize is the attention of ordinary people. And it all depends on data-mining to instantly evaluate the audiences available to see those online display ads.
Consumer advocates say real-time bidding companies are acquiring and commoditizing all of that consumer data with little benefit to consumers themselves — and much digital snooping.
AS real-time bidding gains traction, the consumer data-mining that fuels it is escalating. Yet that surge in surveillance may present a serious risk for online businesses.
And this passage in the article had us thinking about dark pools:
Krux also warned Web site operators about what it called “rogue data collection.” When publishers allow third parties, like real-time bidding platforms or information resellers, to collect data on their site, the report said, those partners often bring in other data miners whose practices the sites themselves cannot control.
The parallels outline in this article with that of our modern post-Reg NMS stock market are striking. However 95% of the harm of data mining in the world of online advertising is that you are discriminated against, and are shown ads you don’t particularly enjoy seeing. We only wish that was the harm from the data sharing in our stock market.