Big Data: Why Do Companies Collect And Store Personal Data

Why do companies collect data and store our personal data? Because big data is money, why else? Read on to learn how the data mining business works, what companies do with your information, and how to limit what they can collect about you.

Why Do Websites Collect And Store User Data?

In the early days of computing, a computer knew almost nothing about you — you logged in, and if you used your real name, the machine knew your name and that was it.

Now consider today’s reality. Voice assistants recognize your speech, cameras recognize your face, wearables record your heart rate and location, and your browsing history, purchases, and app activity are all digitized and within reach. Piece those together and a company can build a fully fleshed-out virtual you — a profile that predicts what you think, what you like, and where you’ll spend money. That is the world we live in, and it exists because of data collection.

Why companies store data is simple: data is knowledge, knowledge is power, and power invariably turns into money. The world’s most valuable companies — retailers, search engines, social networks — became giants largely by collecting data about their users and turning it into advertising precision and sales. Even the smart speaker sitting in your living room is, among other things, a data collection device you willingly installed yourself.

Every time you log into a website, open a new account, fill out a survey, or install a free app, information about you is being collected — often partly for resale, and often with your name or other identifying details attached. Even without your name, your IP address and other markers can tie what you do today to everything else known about you online.

Data Mining And Big Data: Making Sense Of All Those Bits And Bytes

The digital world generates data every second of every day — so much of it that traditional analysis can’t cope. “Big data” loosely describes data sets so large or complex that specialized methods are needed to handle them, and “data mining” is the algorithmic search for patterns within them. Sitting at the intersection of statistics, machine learning, and artificial intelligence, data mining extracts predictive and behavioral insights: what you’ll buy next, which ad you’ll click, how likely you are to repay a loan.

The classic challenges of big data give a sense of its scale:

• Volume — every connected device generates data continuously; if something can be tracked, it gets counted;
• Velocity — as connected devices multiply into the tens of billions, data arrives in real time and never stops;
• Variety — clicks, images, audio, video, location traces, biometrics, sensor readings, and more;
• Veracity — the quality and accuracy of collected data varies wildly, and bad data leads to bad conclusions.

The Benefits And Risks Of Big Data

Big data is not inherently evil. Marketing and retail use it to reach the right customers and cut wasted advertising. Banks use historical data to assess credit risk and to spot anomalous transactions that indicate card fraud. Manufacturers compare repair logs with performance records to fix machines before they break. Public health authorities use large data sets to track the spread of disease.

The risks, however, land mostly on you:

• Privacy. Data collection easily crosses the line from counting website visitors to compiling names, addresses, phone numbers, ID numbers, and financial details. Data mining firms build huge dossiers on individuals; seemingly random fragments can be pieced together to infer religion, political views, health conditions, or sexual orientation — and such profiles are for sale.
• Security. Every organization storing your personal information is a target. When a data broker, retailer, or health provider gets breached, it's your identity that ends up for sale, and criminals need only a few pieces of information to attempt ID theft or drain an account.
• Misuse. Ethically collected information can be used unethically — to target vulnerable people, to discriminate, or for mass surveillance when governments tap into commercial data streams.
• Inaccuracy. Wrong or stale data skews the automated decisions increasingly made about you — the ads you see, the prices you're offered, even risk scores attached to your name.

Who Is Collecting Your Data? Everybody.

An entire industry — often called data brokers — exists solely to collect, analyze, and sell information about people. Brokers sell to each other, to marketers, to insurers, and to governments; the global market for data and analytics is measured in the hundreds of billions of dollars. Their core product is “people-based marketing”: the ability to deliver the most relevant possible ad, sometimes suggesting things to you before you know you want them.

The collection points are everywhere:

• Free apps and games monetize through data: with the right permissions they can log your location, movements, contacts, and habits;
• Ordinary businesses have realized their customer lists are a secondary revenue stream and sell them like dedicated brokers do;
• Third-party trackers embedded in websites quietly gather and analyze visitor behavior across thousands of sites at once;
• Your ISP sits in a privileged position, able to observe which sites every device in your home connects to.

What Can You Do About Data Collection Online?

It is impossible to go online without some information being collected about you. What you can do is limit what is collected, and by whom. Focus on two things: the information you hand over voluntarily, and the trail you leave involuntarily.

For the first, the rules are behavioral: share the minimum when signing up for services, skip optional profile fields, deny apps permissions they don’t need, use strong unique passwords with two-factor authentication, and keep antivirus, anti-malware, and firewall protection active so data-harvesting software never gets a foothold on your devices.

For the second, you need a VPN. A virtual private network uses encryption and tunneling protocols to make your connection unreadable to outside observers. Connect through a VPN server and your traffic bypasses your ISP’s logging in readable form; websites and trackers see the VPN server’s IP address instead of yours, stripping away one of the most powerful identifiers used to stitch your online activity into a single profile. You can see exactly what identifiers you broadcast on Le VPN’s test-your-IP page.

Le VPN secures your connection with modern protocols — OpenVPN, WireGuard, Stealth WireGuard, and IPSec/IKEv2 — across servers in 100+ locations worldwide, with apps for Windows, macOS, iOS, and Android and up to 5 simultaneous connections per account. After that, it’s up to you to avoid typing in information you don’t want the internet to know. If limiting what the data industry knows about you sounds like what you need — and it is — there’s no reason not to get Le VPN now, backed by a 30-day money-back guarantee on your first purchase.