You’ve just downloaded Google Voice, and you love its price tag: Free. But there’s a tradeoff. You are voluntarily exposing your every word and the words of the people with whom you speak to Google’s voice recognition algorithms.

On the plus side, this means you can read your voicemail just like your emails. On the minus side, everything you talk about goes to inform Google’s ad placement algorithms about you and people like you.

There are two big reasons why these companies will never protect your data:

1. They believe privacy is unimportant.

Facebook and Google will never protect your privacy, because they believe that privacy is unimportant. For these mega-xcorporations, no amount of visibility is too great, and you don’t have to worry about them, because they’re the good guys. In 2009, Google CEO Eric Schmidt said it plainly: “If you have something that you don’t want anyone to know, maybe you shouldn’t be doing it in the first place.”

This, of course, ignores what the internet can do to people who make simple mistakes. For instance, the Muslim man in 2012 who was accused of terrorism when he texted his employees to ‘blow away’ the competition at a trade show.

While declaring “What people want isn’t complete privacy. It isn’t that they want secrecy. It’s that they want control over what they share and what they don’t.” But, in reality, Facebook has intentionally worked to increase public willingness to share sensitive information while reducing their ability to control who sees it. One recent example is the intrusive default settings ofFacebook Instant Messenger, which have since been changed. Additionally, Facebook regularly runs afoul of privacy regulatory agencies.

Mark Zuckerberg has said,

Advertising works most effectively when it’s in line with what people are already trying to do. And people are trying to communicate in a certain way on Facebook — they share information with their friends, they learn about what their friends are doing — so there’s really a whole new opportunity for a new type of advertising model within that.

2. They provide free services so that they can sell ads using your data.

Mark Zuckerberg has said that Facebook will always be free, and that they will always use ads as their source of revenue. Google mines everything from your smartphone to voicemails on Google voice. All of that data is used to tailor ads to you with demographic analysis.

Google and Facebook refine the ads they show you based on your

  • gender
  • orientation
  • age
  • race
  • friends
  • income
  • browsing habits and history
  • location
  • job title
  • number of people in your family

… and far more.

Now, few people go on the internet and announce their income on a public forum, or even post it in a friends-only post on Facebook, so Facebook and Google infer your income from a variety of other factors. Just as in any other statistical approximation, the larger the set of data points, the more accurate they can be. The more accurate they are about an ad’s relevancy to you, the more click-throughs the ad is likely to get. When the company can show their advertisers that they get more click-throughs, they can demand higher cost per ad, raising profits.

What is your data worth to these companies? For Facebook, about $0.20 per month, by one estimation. That doesn’t sound like much, but multiplied by 1.5 billion users, that’s a lot of revenue. This earnings report is in millions, so be sure to mentally add six zeros after each number. Total ad revenue was $3.32 billion dollars.

It’s easy to push the “Agree” button on that end user licensing agreement for your new app. It’s harder to feel secure about the way your data is protected when you see the attitudes of the companies and the way they use your information.