Ryan Calo writes:
The intuition that privacy and innovation are somehow opposed is surprisingly common. It is true that overzealous or reactionary appeals to privacy can cut off interesting ventures. (For instance, some believe Steamtunnels would have evolved into a social network in 1999 were it not shut down by the Stanford University due to privacy and copyright concerns.) But privacy generally supports innovation, and vice versa.
Companies also innovate in response to user demand for privacy. Recent comments by the Electronic Privacy Information Center to the Department of Commerce point out: “As consumers place more of a value on privacy, companies compete over privacy, which leads to innovation.” Demand for privacy has even created arguably novel business models.
Finally, there is no reason to believe that all innovations—including those that involve the collection and processing of information—necessarily erode privacy. Some will; others will not. Rather than focus on any supposed conflict between privacy and innovation, we should be focusing on determining which innovations harm privacy—by creating discomfort and unease, for instance, or leading to adverse consequences we did not anticipate—and how to avoid or mitigate those harms. Moreover, we should recognize when and how innovative uses of information can proactively help consumers protect themselves. Privacy has nothing to fear from innovation. Innovation, everything to gain from better privacy.
Read more on The Center for Internet and Society.