Zach Capers, CFE
ACFE Research Specialist
Recently, I attended the ID360 conference in Austin, which was presented by the University of Texas at Austin’s Center for Identity. The theme of the conference was “The Identity Economy” with speakers focusing on such topics as personal identity management, social media and online security. The discussions of these interrelated topics made me consider the ways I leverage my own identity in the emerging identity economy, and — more concerning — how my identity is used by others.
Identity is now a form of currency, and the consequences of this development are unfolding in interesting and often unpredictable ways. As a music lover living in Austin, I have noticed during the past few years how the identity economy is developing in the realm of live music and event ticketing. For example, during the recent South by Southwest (SXSW) festival, I found myself shamelessly tweeting about the Mazda car company for a chance to win passes to an event I wanted to attend. Despite how obnoxious my shilling must have seemed to others on my Twitter feed, I felt it was worth it, particularly because I ended up winning the passes.
The identity economy was apparent in other aspects of SXSW as well. This year, an increasing number of events required that prospective attendees register through their Facebook accounts. This meant that attendees had to open their Facebook pages to applications that often collect and share personal information for marketing and other purposes. I found this too much to bear, so I avoided events that required compromising my Facebook account; however, countless other festival-goers likely did so without questioning the practice of providing access to their personal information in exchange for access to an event.
Another facet of the identity economy is the phenomenon of developing a user reputation to enhance standing within a particular user base. For example, the ticketing firm 1iota provides free tickets to television shows and concerts based largely on reputation. If you sign up for an event, win tickets and subsequently follow through with attending the event, your chances of winning tickets to the next show increase. Conversely, if you win tickets and fail to attend the show, your chances of receiving tickets in the future plummet. The idea is that those who build a strong reputation on the site tend to be more enthusiastic and dependable fans whom organizers prefer to have at their events. Reputation systems have been in use for many years with websites such as eBay and LinkedIn, and they will only increase in number and variety going forward.
At last month’s Coachella music festival in Indio, California, the identity economy was also in full swing. All ticket buyers were required to wear a wristband containing a registered radio-frequency identification (RFID) chip, and all wristbands had to be activated with the individual’s personal information, with the option to connect the wristband to a Facebook or Spotify account. No doubt much of this information was collected for demographic research and subsequent marketing efforts. However, the RFID technology was also used to streamline entry, reduce fraud in the secondary market and track the movement of individuals inside the festival grounds to maximize logistical efficiency. Another result is that individuals can no longer attend America’s most popular and profitable music festival anonymously.
While many of these uses of identity might seem relatively innocuous, we must always question how much of our identity we are willing to trade for convenience. Our evolving — or devolving — concepts of privacy and identity are fundamentally changing not only commerce, but also the strategies through which companies and criminals exploit our personal information for profit. At the ID360 conference, the University of Texas announced a Master of Science in Identity Management and Security degree program; the first of its kind in the nation. Perhaps a new generation of identity experts will help guide us through the burgeoning convergence of our identities and the economy.