Why Digital Identities Matter

There have been numerous economic shifts over the last couple of decades. These have affected how businesses operate and how they interact with their customers. However by far the biggest impact has been the rise of the internet and the growth of automated web based services. Remember if you can how you used to buy airline tickets and compare it with today’s experience. I’d wager there’s not many people left who’s first move would be for the phone or to stroll down to a travel agent if they wanted to book a flight somewhere.

Most people will research and purchase their tickets online, indeed almost all aspects of the flight can be managed through the medium of a web application. You can buy your ticket, select your seat, order your lunch and even check in without actually leaving your computer. When it comes to flying you can get updates via your phone and even reschedule if required without going near an airport or more importantly a human being! In essence most of the time this is preferable and there’s little doubt that usually buying an airline ticket online is a much easier process. The crucial difference though from both sides is that there is no longer a requirement for a human to be in the loop. Again this is not an issue when the web or application experience works perfectly but that crucial link of a trust relationship that can solve potential issues is never actually established.

The experience for a customer is dramatically different, the number of face to face transactions is now limited to very specific purchases. The majority of us buy and order goods and services on our computers, tablets or phones. They arrive delivered to our door, or digitally downloaded, emailed or streamed directly to us. That person to person interaction that is missing obviously affects the experience but also represents a huge issue of how we identify ourselves to an automated online system. There are other relationships affected to, not just business to customer – businesses have to interact with suppliers, partners and employees. Many of these interactions have also moved to automated digital systems too.

Digital Identities Are Important

At the very centre of our increasingly service orientated economy are millions of these network based, automated transactions that happen between connected devices online. These transactions are fundamentally different than the transactions that occur in the physical world. When you go to a shop to purchase your lunch, you can exchange cash for a sandwich. Unless we’re a regular visitor, or perhaps know the shop assistant then this transaction is essentially anonymous. The shop doesn’t know who bought the sandwich, only that they paid for it and it’s gone.

Contrast that with the digital world, and you’ll find that anonymous transactions are extremely rare. Delivering goods or services means that anonymity is almost impossible, at the very least the supplier will need a delivery address. In reality the supplier will probably find out a huge amount of information about it’s customer compared to the ‘old fashioned’ physical transaction. They can discover information about location, names, addresses, IP addresses plus preferences and a host of other attributes which can be gleaned from their digital footprint – your digital identity reveals way more information than your physical one. Your digital identity is important.

Obviously it’s only common sense that in an automated network based environment, you have to reveal your location in order to get something delivered. Technically digital products could be delivered anonymously, but it’s certainly not in the suppliers interests to provide this sort of privacy unless it directly affects sales (something illegal or embarrassing perhaps). Transactions like this do occur on places like the Dark Web facilitated by cyber currencies like Bitcoin. However for the majority of us, we are building up large and informative digital identities whether we like it or not. It’s not even possible to completely opt out of these systems either because businesses will use similar systems to track employees, resources and suppliers too. In all these scenarios digital identities will end up being assigned and therefore must be managed too.

Opportunities on Both Sides

Make no mistake about it, the user data that is building up in our digital profiles is extremely valuable.  On the face of it, the information is used to provide better or more efficient services which is true to some extent.  However it has also fueled a myriad of opportunities for most businesses who can effectively bypass the old restrictions of time, scale and physical locale.    These businesses seek to leverage the information in our digital identities to grow their businesses and increase profits.

The problem with these identities that in many ways the customer is usually takes a more passive role.  As we go about our daily lives, it’s as if huge electronic folders are being built up about us.  The level of information that can be compiled into these identities is incredible when multiple sources are aggregated together.  Our tastes, preferences and purchases can all be analysed and monitored to produce an  incredibly accurate picture of who we are.  The information is valuable to all sorts of people from governments to business and of course to political parties too.  Our digital  identities contain much more than a simple checklist of what we’ve bought online over the last few years.  There is however the opportunity to take back a little control over all this information by creating alternate identities which we can use online.

Much of this is behind the opportunities described on this site in the various sections.  Obtaining and using an alternate residential IP address is more than just technical sleight of hand.  This address is effectively the cornerstone of a brand new digital identity, when used with ‘incognito browsing’ and a decent proxy or VPN it’s like having an alter ego to use online.   If you want to make purchases that are not tracked back to you, if  you want surf online without being monitored then hiding your real IP address is the first logical step.

It’s also a way to maximise efficiency from a consumer perspective rather than just being the one manipulated.  Take for example the economic principle of price discrimination where companies offer identical goods and services to different markets at varying prices.  The idea is to maximise profits by selling at the highest possible price in each market. So for example the online games company – Steam sells the same digital downloads to different people at vastly different prices.  The idea is that consumers in Western places can pay more for their software than people in poorer countries, rather than offering one low price they vary the price based on you location.   This of course relies on establishing a digital identity to the customer at the other end of the network connection.  In this scenario, the important demographic is location – which is established from the incoming IP address.

When you take control of this key piece of information you effectively level the playing field slightly.  The ability to vary your IP address means you can effectively counter this discrimination in all sorts of ways.  Obviously many of the example on this site include online entrepreneurs establishing multiple identities for profit using things like Sneaker or other ATC proxies.   Controlling a selection of digital identities from the other side opens up opportunities to bypass commercial restrictions being placed by these web sites.   Whether it’s used to buy lots of limited edition sneakers or to scalp tickets for the latest shows, in many ways it’s simply leveling the playing field somewhat.  Many thousands of people make their entire living buying and selling on social networks using a whole host of digital identities and automated software like Instagram marketing bots.

The Technological War of Digital Identity 

Because the business context of digital identities is so important, obtaining and controlling this information is likely to be a core goal of most online businesses.  The economic shifts of this control are likely to swing both ways in the coming years.  Increasing awareness of the lack of privacy online has encouraged many people to use sophisticated VPNs and proxies in order to hide their identities.  While the trend for harvesting and exchanging personal data is being fueled by decentralized computing and the use of things like XML.   Of course, it’s unlikely that the same effort will be put into keeping this data secure as there is to gathering it so expect to hear stories of data and identity theft grow too.

Whether you’re looking for business opportunities or simply want some privacy online, having access to multiple IP addresses is important.  Without them everything you do online can be tracked back to your specific IP and correlated to your name and address.   It’s the digital equivalence of handing out a little map with your name and address to everyone you meet or interact with in the physical world.    If you have access to residential proxies and addresses, you can effectively don a disguise and browse, buy and sell online withouth being monitored or tracked until of course you take out your credit card!

 

 

 

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