The end of the Wild-West of Data - Relevance and Regulation – Chris R. Hauth director strategy & corporate dev.

Page 2 What is BIG DATA and how BIG is it? The questions we will address today… When does data become relevant? An analytical grid. Why is privacy so important and what do we NEED to do about it?

Page 3 Data is getting bigger and bigger… Note: The data of 2015 estimated by IDC Source: 2011 IDC Digital Universe Study (2011/6); MIC "Information Distribution Cencus" 2015: 7,910 EB 2011: 1,800 EB x 61 ExaByte Worldwide Digital Data Volume BIG DATA 2005: 130 EB (created and stored each year)

Page 4 How big is your data??? Company size is no longer a determinant VS. Size DataWarehouse (in TB) Revenue 2011 (in ) Source: Data Unser – Wie Kundendaten die Wirtschaft revolutionieren (2012), affilinet

Page 5 There is no reason why growth of (unstructured) data should decrease in the future! Source: Facebook Prospectus 2012, YankeeGroup Topline Data Forecast 2011, JPMorgan eCommerce Forecast Social media boomThe Mobile Revolution E-Commerce transactions"Internet of Things" Mobile Data Connections ('04-'11) 20% CAGR Global eCommerce Sales ('04-'11) 23% CAGR Connected Devices 2015 (excl. PC/Mobile) Facebook - Active users ('04-'11) 160% CAGR

Page 6 What is BIG DATA and how BIG is it? The questions we will address today… When does data become relevant? An analytical grid. Why is privacy so important and what do we NEED to do about it?

Page 7 But Size doesn't necessarily matter: Big Data is a complex ecosystem, navigate it wisely Quality Profitability Amount of Data ( - ) Amount of Data ( - ) Quality ( - ) Regulation Source: affilinet -Enrichment -Vizualization -Biz Intelligence -New Storage -Normalization -Categorization Customer Focus

Page 8 Enrichment – enrich and link your Big Data to increase the quality and make it valuable Connect to other players of the Value Chain Product Data Geo-locations Weather Holidays Fit predictors Social Recommendations Special Promotions Environmental Info Evaluations Example Likes Opinions Shares Source: affilinet

Page 9 Vizualization – The right visualization of Data is the key for meaningful interpretation Source: LinkedIn Maps, 2012

Page 10 What is BIG DATA and how BIG is it? The questions we will address today… Why is privacy so important and what do we NEED to do about it? When does data become relevant? An analytical grid.

Page 11 Too often we see big data as a way to improve our productivity, but that's just part of the story No wonder that government get's it all wrong and tries to curb Data Analytics Big Data should be about better services for our customers FIRST What are you using Big Data for??? Source: The Economist - Harnessing a game changing asset (2011)

Page 12 Privacy and end-user trust perception is key: BUT privacy perception differs substantially The good news is: The information our industry is interested in is not considered private by the end- customer BUT: That's just one part of the picture… What is privacy? (EU 27) Source: EU -SPECIAL EUROBAROMETER 359, 2011

Page 13 The start and the end of big data is the complex consumer, don't forget that…! Obviously we communicated something wrong! Big Data should be about privacy and protecting individual needs Your Opinion of Personalized Search? (U.S.) Age BADGoodother Source: PEW Institute – PIP Serach Engine Use 2012, U.S. >75k <30k

Page 14 E-Privacy Directive and the Data Protection Regulation Local Implementation § § W3C Proposal on DNT initiative E-Privacy DirectiveData Protection Regulation Source: EU, W3C, affilinet

Page 15 The Privacy Directive, DNT and Data Protection should be seen in conjunction Source: EU, affilinet Step I Full Transparency Step II Full Control Step III Right to be Forgotten Privacy Directive Data Protection Regulation Do Not Track Initiative (W3C)

Page 16 The Privacy Directive and its implementation in the UK and NL – Key points Source: EU, affilinet UK implementationNL implementation Clear and Comprehensive Information Cookie is storedPurpose of CookieDuration of Cookie Consent can be revoked at all times Cookie = Personal Data Inform DP authoritySecure Data Handling Check & Correct tool for end-users 3rd party processing agreements "Implicite" ConsentPrior Informed Consent

Page 17 Privacy Directive – Compliance Step 1: Full Transparency Goals: -Overlay and at least one very visible persistent link on all pages of your online presence -Clearly communicate purpose and hierarchy of cookies (other tracking methods) -Explain the "implicit consent" issue to the user Source: affilinet Cookie Policy

Page 18 A very first step excluding proactive cookie management Link persistent on all pages -General Explanation -General browser based Privacy Management info -Detailed website principles on cookies -Detailed explanation and list of implemented cookies/segments Source: company information, affilinet

Page 19 Best Practice Basic - Simple & smart solution excluding proactive cookie management Persistent Nav Item Initial Pop up How cookies are used in general Which cookies are set and for what reason (detailed categorized list) How to toogle your browser settings to manage cookies (only as indirect link) Source: company information, affilinet

Page 20 Privacy Directive – Compliance Step 2: Full Control Additionally to Step 1 Introduce an "intelligent 2 stage" process: -Enable control of privacy settings in and outside of browser settings -Pro-actively advise users on active cookie management possibilities (e.g. ghostery, adblock plus, etc.) Source: affilinet Cookie Policy 1 2

Page 21 Best Practice Advanced - Cookie hierarchy and segment specific cookie control Pop-up on first page landing & persistant cookie settings link -General Explanation -Explicit privacy and cookie setup -Affiliate cookies potentially grouped under "strictly necessary and performance" Source: company information, affilinet

Page 22 The implications for your daily work Regulation – What does it mean now for you??? Document, Document, Document!!! Source: EU, affilinet Non-EU based players will need to comply to the new rules Data protection and compliance become more important as not only individuals can sue you (e.g. but also indirectly associated lobby groups) Growing Importance and necessity of well documented "Customer Consent" More and easier accessible user rights, will mean for you to offer customers access and controll (e.g. "Right to be forgotten", personal data portability) Profiling will be harder as the definition of "personal data" is significantly broadened Current timeplan suggest final date for implementation in 2016 Currently the draft means significant strains on our operations, increase in bureocracy and in certain cases the death of whole business models

Page 23 Data Protection Regulation – Compliance Step 3: The Right to be forgotten Additional to step 2 -Clearly communicate use and purpose of ALL cookies (ideally also other tracking methods) -Enable individual control of decisions taken in the past and the right to be forgotten BEFORE setting cookies Source: affilinet Cookie Policy

Page 24 Collaborative, cross-segment solutions currently focused on Behavioral Advertising Industry Board SolutionPrivate Solution Source: company information, affilinet

Page 25 Big Data is the key decision point for our industry and we will need to…. What are the key take aways… Proactively work with government and interest groups to define the customer way forward Intelligently collaborate to improve customer experience using the non-personal data we have Put the end-customers on Prio 1 will be decisive for the industry Source: affilinet

affilinet GmbH Chris R. Hauth Jospeh-Wild-Str München T M E.m. … thanks for time! Enjoy the rest of your a4u Barcelona!