Transcript Bandwidth Funnel Source: L. Surtees, IDC Canada, 2001

Never Lost, Always Found:
The business case for
privacy
2nd Annual Privacy and Security Workshop
Faculty Club, University of Toronto
Nov. 1, 2001
Lawrence Surtees
Senior Telecom Analyst, IDC Canada
Agenda
• Global wireless penetration/growth;
Canadian market
• Wireless Internet market & forecast
• Wireless location & Mobile e-commerce
markets
• Privacy implications
• Consumer attitudes to location technology
and online privacy
IDC’s International Research
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United States
Argentina
Brazil
Canada
Chile
Colombia
Mexico
Venezuela
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Austria
Benelux
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Czech Republic
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Denmark
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Finland
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France
Germany
Greece
Hungary
Italy
Norway
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Poland
Russia
Spain
Sweden
Switzerland
Turkey
U.K.
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Australia
China
Egypt
Hong Kong (Asian
Research Center)
India
Indonesia
Israel
Japan
Korea
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Malaysia
New Zealand
Nigeria
Philippines
Singapore
South Africa
Taiwan
Thailand
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Rising Concerns Over Personal Privacy:
1970-1998
Q: How concerned are you about threats to your personal privacy in America today - very
concerned, somewhat concerned, only a little concerned or not concerned at all?
Source: Louis Harris & Associates; Privacy Journal 2000
100
80
60
40
20
0
1970 1977 1978 1983 1990 1991 1992 1993 1995 1997 1998
Concerned
Very Concerned
Global Wireless v. Wireline
Growth
Source: IDC, March 2000
1400
1200
1000
800
Fixed access lines (M)
600
Wireless subscribers
(M)
400
200
0
1998
1999
2000
2001
2002
2003
Wireless Ascendant: Canadian
Subscriber Forecast, 1999-2005
25.0
70
60
20.0
50
15.0
40
30
10.0
20
5.0
10
0.0
1999
2000
2001
2002
2003
2004
2005
Subscribers
6.9
8.7
10.5
13.3
15.8
19.4
22
Penetration (%)
22
28
34
41
48
59
66
0
Penetration (%)
Number of Subscribers (million)
Source: IDC Canada, Oct. 2001
Canadian Wireless Revenue,
1999-2005
Source: IDC Canada, Oct. 2001
10
8
6
C$B
4
2
0
Revenue
1999
2000
2001
2002
2003
2004
2005
4.3
5.2
6.0
6.7
7.4
8.0
8.7
Number of Canadians on the Net
Source: IDC Canada, 2001 ICMM Version 7.1
30
Per cent of Population
76%
25
69%
62%
20
15
80%
55%
46%
38%
10
5
0
1999 2000 2001 2002 2003 2004 2005
Millions
Canadian PCS Phones With
Internet Access (%)
Percentage
Source: IDC Canada, May 2000
100
90
80
70
60
50
40
30
20
10
0
1999
2000
2001
2002
2003
2004
Canadian Wireless Internet Access, 2000-2005
(Millions users)
Source: IDC Canada, 2001, ICMM Version 7.1
12
10
8
Millions 6
4
2
0
2000
2001
2002
2003
2004
2005
Wireless Internet Use Rising
Browser hits/month (‘000); Jan-Oct 2000
Source: Bell Mobility
6000
5000
4000
3000
2000
1000
0
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug Sept
Oct
Non-PC Devices & Internet
Access
Source: IDC Canada ICMM version 7.1, June 2001
90%
80%
70%
60%
50%
% PCs
% Non-PC
40%
30%
20%
10%
0%
2000
2001
2002
2003
2004
2005
The Internet & eCommerce in
Canada
Source: IDC Internet Commerce Market Model, v6.0 Jan. 2000
160
140
C$Billions
120
Consumer ecommerce:
2004 $19B
Business-Business ecommerce
100
80
2004 $129B
60
40
20
0
1997
1998
1999
2000
Consumer
2001
Business
2002
2003
2004
Mobile e-commerce in Canada
Source: IDC Canada ICMM v. 7.1
6
5.319
C$Billion
5
4
3
2.339
2
0.882
1
0.004
0.042
0.254
2000
2001
2002
0
2003
2004
2005
NGN OSS: Wireless CRM
Customer Interaction Portals
Administration
SelfService
End User
Customer Relationship Management
Billing
Bill
Presentation
Invoicing
Customer
Care
Workforce
Management
Contracts,
SLAs,
Entitlements
Sales Force
Automation &
Order Config
eCommerce
Services Menu
Customer
Records
Trouble
Ticketing
CRM
ERP
3rd party
And
legacy apps
OSS/Service Commerce Engine
Rating
Accounts
Receivable
Hosted /
Enterprise Apps
Performance
Management
System
Mgmt
Load
Balancing /
Node mgmt
Gateway
OSS / Legacy
Interconnect
Service Fulfillment
Directory
Network
Monitoring
Application
Performance
Assign
& Design
Inventory
Mgmt
LDAP
Directory
& API
INA
QoS
AAA
Perform.
And
Reporting
App & Network
SLA Mgmt
Service
Activation
Elements/
Features
Apps
(e.g. e-mail,
www)
ToIP
VPNs
Wireless
Role and Access Definition
and Management
Application
Management
Provisioning
Service
Activation
Bundle
Definition &
Management
Version &
License
Control
WASPs: Future Wireless Carrier
Location
Determination
Service
Provider
$
Financial
Financial
Financial
Source: IDC
$
$
Service
Collector
Provider
$
Portal
Portal
Portal
$
$
Integrator
Integrator
Integrator
Content
Content
Content
ASP
ASP
ASP
Location Determination
Location Enabled Subs (M)
Total Cellular/PCS/SMR Subs (M)
180
140
120
100
80
60
40
Location Determination is defined as the ability of the wireless provider to determine the position of the
caller to within 50m for 67% of calls and 150m for 95% of calls.
Source: IDC, Wireless Location-Based Services Update: Market and Analysis 2000-2005, April
2001
2005
2004
2003
0
2002
20
2001
– By 2003, over 50% of all
cellular, PCS and SMR
subscribers will have enduser equipment that allows
location determination,
rising to 83% by 2005.
160
2000
Location Determination:
Focus group findings
A focus group test of user tolerance for
advertising in new media based on twohour interviews with six groups of Internetsavvy, communications-intensive
consumers (three college-age and three
adult).
(Kiersted and Thorat, IDC Report, Dec. 2000).
Privacy Issues & LocationBased Services
• Protection of Privacy Rights are central to the LBS design
– Real time customer control
– Real time customer visibility
– Application Specific Rules
– Time based Privacy Rules
– Subscriber Control of accuracy level
MPC
WAP Gateway
SMSC
MPC Privacy Rules
Internet
Location Determination II
Location Determination Services
Revenue ($M)
6000
4000
3000
2000
Revenue is defined as that generated directly from the location-based services, such as driving directions, locationspecific directory assistance, restaurant reservation services, etc., and does not include indirect revenue, such as
increased airtime charges due to higher MOU.
Source: IDC, Wireless Location-Based Services Update: Market and Analysis 2000-2005, April
2001
2005
2004
2003
0
2002
1000
2001
– By 2005, location
determination services
revenue explodes to $5.7
billion for cellular, PCS
and SMR subscribers.
5000
2000
Location Determination:
Platform for Privacy Preferences
(P3P)
• Question:
When P3P is operational and bundled into
browsers, will preference-settings be preloaded to:
- favor the collection of user data (opt-out);
or
-will they be set at maximum privacy
protection level (opt-in)?
Wireless Advertising
Total Number of Wireless Ads (M)
Total Wireless Ad Revenue ($M)
Wireless Advertising:
4000
3000
2000
1000
0
Includes ads delivered to wireless subscribers over both wireless Internet and wireless SMS.
Source: Valuable Real Estate: Advertising on the Wireless Internet, March 2001
2005
• Location-determination
allows highly targeted ads
5000
2004
• Wireless SMS growth
6000
2003
• Wireless Internet growth
8000
7000
2002
– Contributing Factors:
9000
2001
– CAGR of 429%!
10000
2000
– Wireless ad revenues will
explode from $1.9 million in
2000 to $7.7 billion in 2005
Wireless Device Form-Factors
Say cheese on wireless Compaq iPAQ H3650 Pocket PC
Operating

System
Windows-Powered
Pocket PC
Memory

32 MB RAM
Battery
Processor

206 MHz Intel
StrongARM

Weight

Screen



Touchscreen
Reflective front-lit TFT
240 x 320 resolution
Lithium Polymer
6.3 oz. / 170 grams
(including battery)
Dimensions

5.1” x 3.2" x .62

130 x 15.9 x 83.5 mm
The case for legislated protection
• Continued business ambivalence
• Superficial adherence to four pillars of
privacy protection
• Increased consumer trust
Factors Driving Corporate
InfoSec Investments
Source: IDC Canada, April 2001; N=200
Q: Which ONE of the following factors is most important to driving your current investment in security?
In c re a s e d u s e o f th e In te rn e t/In tra n e ts
e c o m m e rc e /e b u s in e s s in itia tiv e s
In c re a s e d n e tw o rk a c c e s s re q u ire m e n ts
C u s to m e rs e x p e c ta tio n s
C o rp o ra te g ro w th
M o b ile c o m p u tin g
L e g is la tiv e re q u ire m e n ts
In c re a s e d c o rp o ra te a w a re n e s s
N e w s y s te m s
N e w a p p lic a tio n s
P re v io u s s e c u rity b re a c h e s
0
M id -S ize
L arg e
25
50
P e r c e n ta g e (% )
75
100
Seals versus Legal?
AT&T Labs Survey, 1999
Asked whether respondents would be more or less
likely to provide personal information if:
• the site had a privacy policy stating information
would be used only to process the request;
• a law prevented the site from using information
for any purpose other than processing the
request; or
• the site had both a privacy policy and a seal of
approval from a well-known organization such as
the Better Business Bureau.
Source: Lorrie Faith Cranor, Joseph Reagle and Mark Ackerman. Beyond Concern: Understanding Net Users' Attitudes About
Online Privacy. AT&T Labs-Research. Technical Report TR 99.4.3. April 14, 1999.
www.research.att.com/resources/trs/TRs/99/99.4/99.4.3/report.htm.
Frequency of Privacy Concerns Causing U.S. Web Users to
Leave a Web Site
Q: Over the past six months, how many times have you left a Web site primarily due to privacy reasons?
N=779
Source: IDC Online Consumer Internet Privacy Survey, Oct. 2000
More than 10 times
10
6-10 times
10
4-5 times
20
2-3 times
38
1 time
8
Never
14
0
10
20
% of Respondents
30
40
Warning:
No single privacy
solution can fit all
needs.
Frequency of Privacy Concerns Causing Canadian Web
Users to Avoid e-Commerce
Q: Have concerns over privacy of personal information on the Internet affected your
decisions to purchase online?
N=3,026
Source: IDC Canada e-Omnitel Consumer Internet Privacy Survey, Aug. 2001
Never
Past Year
Past 6 mos
Past 3 mos
Past Month
In past week
0
20
From any Web site (%); N=2,259
40
60
80
100
From a trusted Web site (%); N=1,806
Message from survey data Privacy is not only GOOD for business…
but
essential for e-commerce.
And there are novel methods to protect
consumer privacy online.
Privacy Enhancing Technologies
•
•
•
•
•
•
E-wallets;
Single-use credit cards;
Anonymizer sites and software;
Cookie crunchers;
Protective browsers; and
Personal firewalls. . .
Secure wireless components
Assures the overall trust to
facilitate ebusiness
Trust
Nonrepudiation
Protects data from
unauthorized viewing
Privacy
Integrity
Enforces access control
to resources
Precludes denial of a
valid transaction
Authentication/
authorization
Encryption
Protects data from
corruption, destruction,
or unauthorized changes
Provides the underlying
foundation for all
security components
Payment Agent Architecture
Source: IDC, 2000
Internet User Familiarity with Privacy Options
Q: How familiar are you with the following consumer online privacy tools?
N=779
Source: IDC Online Consumer Privacy Survey, Oct. 2000
1=not at all familiar; 5=very familiar
80
60
40
20
0
Opting Out
eWallets
Online
registration
Anonymous
services
Infomediaries
5
13
10
9
3
2
4
7
10
9
4
2
3
10
16
15
10
8
2
9
12
15
11
13
1
61
53
52
72
75
Want More Information?
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This Presentation:
Lawrence Surtees
•
Customer service:
Stephen Symonds
IDC Canada
[email protected]
416-369-0033 ext. 297
416-369-0033 ext. 266