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Unboxed: Big Data and a Renewed Debate Over Privacy

March 24, 2013 by Leave a Comment

“It really freaked people out,” says Daniel J. Weitzner, a former senior Internet policy official in the Obama administration. “The people who cared about privacy were every bit as worried as we are now.”

Along with fueling privacy concerns, of course, the mainframes helped prompt the growth and innovation that we have come to associate with the computer age. Today, many experts predict that the next wave will be driven by technologies that fly under the banner of Big Data — data including Web pages, browsing habits, sensor signals, smartphone location trails and genomic information, combined with clever software to make sense of it all.

Proponents of this new technology say it is allowing us to see and measure things as never before — much as the microscope allowed scientists to examine the mysteries of life at the cellular level. Big Data, they say, will open the door to making smarter decisions in every field from business and biology to public health and energy conservation.

“This data is a new asset,” says Alex Pentland, a computational social scientist and director of the Human Dynamics Lab at the M.I.T. “You want it to be liquid and to be used.”

But the latest leaps in data collection are raising new concern about infringements on privacy — an issue so crucial that it could trump all others and upset the Big Data bandwagon. Dr. Pentland is a champion of the Big Data vision and believes the future will be a data-driven society. Yet the surveillance possibilities of the technology, he acknowledges, could leave George Orwell in the dust.

The World Economic Forum published a report late last month that offered one path — one that leans heavily on technology to protect privacy. The report grew out of a series of workshops on privacy held over the last year, sponsored by the forum and attended by government officials and privacy advocates, as well as business executives. The corporate members, more than others, shaped the final document.

The report, “Unlocking the Value of Personal Data: From Collection to Usage,” recommends a major shift in the focus of regulation toward restricting the use of data. Curbs on the use of personal data, combined with new technological options, can give individuals control of their own information, according to the report, while permitting important data assets to flow relatively freely.

“There’s no bad data, only bad uses of data,” says Craig Mundie, a senior adviser at Microsoft, who worked on the position paper.

The report contains echoes of earlier times. The Fair Credit Reporting Act, passed in 1970, was the main response to the mainframe privacy challenge. The law permitted the collection of personal financial information by the credit bureaus, but restricted its use mainly to three areas: credit, insurance and employment.

The forum report suggests a future in which all collected data would be tagged with software code that included an individual’s preferences for how his or her data is used. All uses of data would have to be registered, and there would be penalties for violators. For example, one violation might be a smartphone application that stored more data than is necessary for a registered service like a smartphone game or a restaurant finder.

The corporate members of the forum say they recognize the need to address privacy concerns if useful data is going to keep flowing. George C. Halvorson, chief executive of Kaiser Permanente, the large health care provider, extols the benefits of its growing database on nine million patients, tracking treatments and outcomes to improve care, especially in managing costly chronic and debilitating conditions like heart disease, diabetes and depression. New smartphone applications, he says, promise further gains — for example, a person with a history of depression whose movement patterns slowed sharply would get a check-in call.

“We’re on the cusp of a golden age of medical science and care delivery,” Mr. Halvorson says. “But a privacy backlash could cripple progress.”

Article source: http://www.nytimes.com/2013/03/24/technology/big-data-and-a-renewed-debate-over-privacy.html?partner=rss&emc=rss

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Portugal Faces Challenges in Meeting Bailout Terms

August 10, 2011 by Leave a Comment

International lenders calling this week on Pedro Passos Coelho, who moved in just two months ago, will be looking, however, for more than superficial improvements to the country’s economy before writing their next check.

Three months after approving a €78 billion, or $111 billion, bailout for Portugal, officials from the International Monetary Fund, the European Commission and the European Central Bank are conducting their first review of progress toward meeting conditions set for emergency financing. Those include budget cuts and an economic overhaul intended to stimulate growth.

Portuguese officials and business executives expect a broadly favorable assessment following general elections that replaced a minority Socialist government with a stronger, center-right one. But they also worry that elements out of their control — a widening debt crisis in Europe and fears of a slowdown in global growth that have been rattling markets — could undermine Portugal’s efforts.

“To make the changes that we have agreed to is a necessary condition, but not a sufficient one” alone, said António Mexia, chief executive of EDP Energias de Portugal, the country’s largest utility.

“There are now a lot of things that no longer depend on Portugal but instead on Spain and Italy and other countries around us,” he said. “In this crisis not even bigger countries than ours can say that they control fully their destiny.”

Still, since his electoral victory in June, Mr. Passos Coelho, Portugal’s new prime minister, has struck a confident note, insisting that his government would reduce the budget deficit by more than a third this year, to 5.9 percent of gross domestic product from 9.1 percent in 2010.

Such drastic tightening would be a significant improvement on the performance of the previous government. It would also contrast with the situation in Greece, which remains on the brink of default more than a year after becoming the first euro zone country to be rescued.

The Finance Ministry in Athens reported last month that the budget deficit there had widened by almost a third in the first six months of this year — blowing its targets — as a deep recession exacerbated by budget cuts dampens government revenue.

“What we learnt from Greece is that it’s all about implementation,” said Carlos Moedas, a former Goldman Sachs investment banker named by the Portuguese prime minister to oversee the budget agreement with its foreign creditors. “The kind of implementation monitoring that we are putting in place is completely new in Portugal and I believe even ahead of what was done in past I.M.F. programs.”

As in the bailouts of Greece and Ireland, the lenders have set quarterly progress reviews. For Portugal, the outcome of the first review is expected as early as the end of this week.

When the I.M.F. was last called to Portugal’s rescue in the early 1980s, the intervention was widely unpopular, largely because it led to a sharp rise in interest rates.

This time, despite grumblings by Portugal’s powerful Communist party about foreign intervention and excessive austerity demands, “there is a real and widespread sense of relief that we are finally getting helped by qualified financial experts, because people here are completely fed up with mismanagement by our politicians,” said Pedro Reis, author of “Returning to Growth,” a recent book detailing Portugal’s economic woes.

Nuno Vasconcellos, who heads Ongoing, a family investment company that has several media businesses, as well as a significant stake in Portugal Telecom, said the arrival of the I.M.F. “must be seen as the perfect excuse to make all the reforms that Portugal has refused to consider for the past 30 years.”

Indeed, one of Mr Passos Coelho’s challenges is to lead by example and rein in spending in the country’s bloated public administration, as well as improve performance at state-controlled companies that have accumulated about €40 billion of debt.

Article source: http://www.nytimes.com/2011/08/10/business/global/portugal-faces-challenges-in-meeting-bailout-terms.html?partner=rss&emc=rss

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Can Microsoft Make You ‘Bing’?

July 30, 2011 by Leave a Comment

MIKE NICHOLS has a poster on his office wall. It shows the young Muhammad Ali glaring down at a fallen Sonny Liston, the bruising heavyweight who had seemed invincible — until Ali beat him, in 1964, in one of the biggest upsets in sports history, and then beat him again a year later.

“The triumphant underdog,” Mr. Nichols says, nodding toward the wall.

The inspirational fight poster is fitting, because Mr. Nichols, a general manager at Microsoft, is a lieutenant in an underdog corporate army here. Its daunting mission is to take on the Google juggernaut.

Microsoft’s assault on Google in Internet search and search advertising may be the steepest competitive challenge in business today. It is certainly among the most costly. Trying to go head-to-head with Google costs Microsoft upward of $5 billion a year, industry executives and analysts estimate.

As the overwhelming search leader, Google has advantages that tend to reinforce one another. It has the most people typing in searches — billions a day — and that generates more data for Google’s algorithms to mine to improve its search results. All those users attract advertisers. And there is the huge behavioral advantage: “Google” is synonymous with search, the habitual choice.

Once it starts, this cycle of prosperity snowballs — more users, more data, and more ad dollars. Economists call the phenomenon “network effects”; business executives just call it momentum. In search, Google has it in spades, and Microsoft, against the odds, wants to reverse it.

Microsoft has gained some ground. Its Bing search site has steadily picked up traffic since its introduction two years ago, accounting for more than 14 percent of searches in the American market, according to comScore. Add the searches that Microsoft handles for Yahoo, in a partnership begun last year, and Microsoft’s search technology fields 30 percent of the total.

Yet those gains have not come at the expense of Google. Its two-thirds share of the market in the United States — Google claims an even higher share in many foreign markets — has remained unchanged in the last two years. The share losers have been Yahoo and smaller search players.

The costs for Microsoft, meanwhile, keep mounting. In the latest fiscal year, ended in June, the online services division — mainly the search business — lost $2.56 billion. The unit’s revenue rose 15 percent, to $2.53 billion, but the losses still exceeded the revenue.

Microsoft is a big, rich company. But investors are growing restless at the cost of its search campaign. In May, when David Einhorn, the hedge fund manager, called for Steven A. Ballmer, Microsoft’s C.E.O., to be replaced, he pointed to the online unit as a particular sore spot.

Qi Lu, president of Microsoft’s online services division, sees the situation this way: “To break through, we have to change the game. But this is a long-term journey.”

MR. LU, 49, knows about long journeys — and persistence. His grandparents raised him in rural China, in a home without running water or electricity. A bright student, he won a scholarship to the doctoral program at Carnegie Mellon.

After stints at the Almaden Research Center of I.B.M. and at Yahoo, where he was in charge of its search and search ad technology, he joined Microsoft at the end of 2008. He was recruited by Mr. Ballmer, who assured him that Microsoft was committed to search and competing with Google for the long haul.

Paul Yiu came from Yahoo two years ago, impressed by Microsoft’s approach to competing in search. A business and product manager, Mr. Yiu had spent most of his career in Silicon Valley, often working for Microsoft adversaries like Netscape and Oracle.

He explains that in the valley, with its job-hopping and start-up culture, there is a “renters’ mentality”: if things aren’t working out, just move on. At Microsoft, he says, there is a “homeowners’ mentality”: a dedication to making things work.

“If you’re in the expensive search game, you need to have a homeowners’ mentality,” Mr. Yiu says.

Microsoft’s leadership knew years ago that becoming a real competitor to Google would take patience as well as dollars. In 2007, Mr. Ballmer met with Harry Shum, a computer scientist who led Microsoft’s research lab in Beijing at the time. Mr. Ballmer, as Mr. Shum recalls, told him that the company wanted to make a concerted push in search and bring in leading technical experts and business managers.

“You spent 10 years in research, and now you’ll spend the next 10 years in search,” he remembers Mr. Ballmer saying to him.

Article source: http://feeds.nytimes.com/click.phdo?i=b0dcd4ea3421aa3b1b62489670b3ca13

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