Google Reads Your Email, and Facebook is Jealous

Gmail is free – provided you don’t assign any cost to Google reading your email.  It is a simple case of risk and reward.  Gmail users have accepted this trade off because the utility (reward) of the service eclipses the perception of the risks associated with the lack of security.  Facebook aspires to be the owner of identity management for the purpose of selling personal information to marketers and cannot imagine being left out of the email reading business.  So this week Facebook will announce their own free email service.

It will be interesting to see how long users accept this lack of security.  Clearly Google crossed the line earlier this year when they pushed Buzz too close to gmail and got big blowback – so users are not completely ambivalent about security.  There have been a few cases (This American Life; Gizmodo) where federal officials have pursued people because of posts on Facebook.  A few more of these and law abiding citizens could start to fear Facebook, Google and other free/unsecure services.

Yes  it is legal for Google and Facebook to read your email because of the agreement you accept when signing up.  Of course no one reads those agreements, and most people know that their employers can legally read their email too – so adding Google or Facebook probably doesn’t really register.  If there is a tipping point on the horizon where security becomes as big or bigger than convenience, what will the users do? 

Last week I was at Mark Anderson’s Fire Global conference in Seattle where Steven Sprague (Wave Systems) proposed this idea:  “What if I could encrypt my data before sending it to Facebook and only my friends could decrypt it.”  Could this be the next Facebook:  a system that would manage connections and encryption keys?  There would have to be a different monetization model, and it is highly unlikely that Facebook itself would go this route.  Maybe someone is out there right now building such a system.

On the email front, someone could easily emerge as the secure provider.  ISPs offer email service along with their bandwidth subscriptions, so they would be in prime position to play up the security angle.  AOL is a trusted brand and their un-hipness may even be an asset.  Apple could capitalize with its mobileme service. And last but not least is Microsoft.  Sure the Hotmail people are reading your mail, but the new Office365 paid service could be better positioned than any of the others to take advantage of this shift.

This will be an interesting one to watch.

LATER (11/14):  Just noticed that AOL launched an email revamp today.  Read about it on ZDnet here.  I don't see any mention of security, so it does not look like they are playing up the angle I thought.