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Potential Commerce Applications Drive Facebook’s Interest in Real User Identities

August 8, 2011
Credit|Emerging_Technologies
Patricia McGinnis
Mercator Advisory Group
Does your Facebook account information include your real name, or a pseudonym?  When you set up your account, did you provide your primary e-mail address, or an alternate?  Recent pronouncements by Facebook’s head of marketing, Randi Zuckerberg, have focused on the company’s belief that anonymity has to disappear in the online world, or at least, in Facebook’s world.  Facebook wants to know who we really are. 

TechCrunch’s Semit Shah presents the pros and cons of the debate:

“The topic of online identity and anonymity is polarizing. Powerful interests have strong incentives to build a web where real identities rule. Other powerful interests will fight relentlessly to protect and preserve spaces for users to interact, either anonymously or through pseudonyms.”

He then outlines his analysis of the ways that secure, verifiable online identities could be useful (and more efficient) to all of us, and concludes with his belief that Facebook, LinkedIn, and the like are well-suited to this task. 

“The real economic potential these types of companies have is in verifying and authenticating our identities so that they can provide us with an interesting and fun online experience, connect with parts of our professional and personal lives, and potentially power a new type of commerce that could generate massive sums of revenues and profits while saving us all a tremendous amount of time, money, and stress.”

Can we agree with him?  In practice, I think not.  I do agree that a trusted online identity management  provider would be a solid addition to our online lives, but I see no reason to allow the social networks to usurp that role.   Other social networks (e.g., Hyves in the Netherlands) have taken on this identity validation function to facilitate payments and purchases.  However, Dutch privacy law severely constrains the ability of Hyves (or any other entity) to use personal information without specific permission, so Danish consumers have far more privacy protections than those in the U.S.   Experience suggests we in the U.S. should be very cautious about empowering Facebook with that capability, because we have no defense against Facebook using all the information they have to their own advantage and for their own purposes.

The U.S. Commerce Department recognized the importance of identity management in its recent report “National Strategy for Trusted Identities in Cyberspace.”  This report does not propose a government-operated identity program for the U.S., but rather, contends that the best solution would be one that comes from the private sector.   Surely committed identity specialists can craft a potential solution that reflects a respect for individual privacy somewhat more designed to protect consumer interests.   I suggest we not surrender this powerful capability to Facebook simply because they want it. 

Click here to read the TechCrunch piece: http://techcrunch.com/2011/08/01/facebook-real-identities-commerce/

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