Friday, May 20, 2011
Billions of Unverified Identities creating an Online Identity Crisis
The online world faces its greatest challenge, billions of unverified user identities on webmail, social networking and other sites. Driven by valuations that factored number of customers as a key parameter, VC funding and advertisement supported revenue, sites offered free services which do not require customer identity verification. The net positive was the dramatic growth of the WWW as the ease of use prompted many users to sign up. The net negative was that free services resulted in a net rise in consumer email fraud and social crimes which are difficult to trace and prosecute. And the problem will just get BIGGER.
The main reason why companies did not pursue the verification of customers was due to cost, global scale of the operation, the fact that customers were unlikely to pay for services and adoption of early web based services were on reference and experiential use.
To reduce social crimes, social networking site set-up mechanisms to identify and report social crimes like cyber harassment, cyber bullying, hate crimes, flaming, pornography, copyright violations and so on. Countries are attempting to frame laws but they vary in degree of responsibility between the user who generates content and the site which host it. If laws are framed to make it mandatory for the hosting site to remove content, these provider cry Censorship. If the laws are framed to prosecute users it is also seen as Censorship. A political catch 22 situation compounded by the fact that prosecution of an unverified identity provides for many legal loopholes to subvert the law.
Going forward we need a common process to uniquely verify identity, much like a cell phone number. Verification of identity can come from citizen databases which are being set-up in various countries, but there is still a long way to commercial adoption. Once this is done the cost of upgrading existing identities to verified ones would be significant. In my opinion in the next ten years all identities will be verified and identity verification mandated by law.