Study Web Giants Today for Smart Grid Privacy Tips Tomorrow

The smart grid may indeed become an opportunity that’s bigger than the Internet, but like the Internet, it won’t be without its stumbling blocks. Fortunately for us, some web pioneers are unwittingly providing utilities and energy management firms with an education on privacy, one of the thornier issues affecting online businesses today.

By now, you’re probably pretty well versed in the convoluted saga of Facebook’s privacy mechanisms. Google, too, has been struggling with privacy, first with the well-publicized Buzz uproar and then when it was discovered that its fleet of Street View vehicles in Germany was capturing Wi-Fi “payload” data – basically the information traded between laptops and wireless access points. Uh, oh.

It’s clear from these episodes that privacy matters — a lot. And while no one is forced to sign up for Facebook or use any of Google’s services, many home owners soon will get smart meters and start transmitting their energy usage data with little choice in the matter. Utilities and home energy management firms need to try to avoid some of the privacy gaffes that have tripped up these companies by getting customers on the same, easy-to-read page.

If the Facebook fiasco taught us anything it’s that users want to be behind the wheel when it comes to sharing the data they generate. And by “behind the wheel” I mean providing controls more like those in a car, not a space shuttle cockpit. In other words, adjusting privacy settings needs to be simple. Any home energy monitoring and management provider that’s planning to leverage user data for marketing partnerships or social networking functionality — or any other third-party transfer of information — should be prepared to cater to this desire.

Similarly, if your home energy management outfit has plans underway that affect customer data, clue your users in before they’re fully implemented. It’s a way to gauge their reaction, address feedback and perhaps incorporate unexpectedly helpful suggestions.

For more thoughts on how smart grid firms can learn from Facebook’s and Google’s recent privacy missteps, check out my weekly update at GigaOM Pro (subscription required).

Image courtesy of anitakhart’s photostream

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